Adding to the myriad unicorn layoffs we have seen recently is now Carbon Health, a healthcare company offering virtual care, which said in a letter Thursday that it laid off 250 people, or 8% of its workforce.
CEO Eren Bali also tweeted out the news, noting that “We hired some of the most talented and mission-driven people on Earth. Any company would be lucky to have them. Please reach out to us at firstname.lastname@example.org if you’re hiring, and we will connect you."
Yesterday was the hardest day at @carbonhealth since we started the company 6 years ago. We had to take a difficult action in order to reduce the size of our global workforce to adapt to the changing market conditionshttps://t.co/R6o1eqWBA5
— Eren Bali (@erenbali) June 2, 2022
Bali started Carbon Health six years ago after leading education marketplace Udemy. In subsequent years, Carbon Health went on to raise over $500 million in venture-backed investments, according to Crunchbase data.
The most recent was a $350 million Series D round in July 2021, led by Blackstone Group, that reportedly put the company at a $3.3 billion valuation. We covered its $100 million Series C round in November 2020.
In his letter to employees, Bali outlined two reasons for the decision to let go of staff — despite its continued and fast growth over the years. The first was winding down some of its business lines related to COVID. In 2020, Carbon Health developed both pop-up clinics and at-home test kits.
According to growth metrics reported when it raised capital last year, Carbon Health’s patient volume increased 129% between its Series D and its Series C raise in November 2020.
Since the pandemic started in early 2020, the company kept up the pace by doubling its full-time staff to 1,600 employees as it opened over 80 clinics in 12 states and expanded its virtual clinics to 23 states. One of its goals with the Series D had been to grow to 1,500 clinics by 2025.
The other reason Bali gave for the decision to lay off staff was a shift to focus on profitability, writing, “we have been more focused on top-line revenue growth, patient acquisition, patient retention and service expansion, and we have been less focused on profitability. While that was the right decision in 2020 and 2021, the macro environment with more volatile capital markets means it is vital that we become less focused on growth and more focused on profitability.”
Impacted employees were told via 1:1 conversations and offered separation packages that included extended healthcare coverage, removed equity cliffs for options and outplacement support.
As noted, Carbon Health joins a list of unicorns that had to scale back their workforces, some as a result of growth during the pandemic, including Loom, Hopin and Picsart. Health tech companies having layoffs this year included Halycon Health, Mfine, Kry, Thirty Madison, divvyDOSE, Noom, Ahead and Truepill, according to Layoffs.fyi, which keeps a database of reported layoffs.