Banking-as-a-service platform Treasury Prime laid off about half of its nearly 100 employees, CEO Chris Dean confirmed.
Treasury Prime laid off teams focused on selling its products to other fintechs, including marketing, as a result of a strategic pivot that will, from now on, have the company focusing its sales efforts exclusively on banks.
The firm has historically marketed itself to fintechs, then connected the fintech with a banking partner that would use Treasury Prime’s platform. However, Dean said the “interesting activity,” for the past six months or more, has been on the bank-direct side, and banks have wanted more to negotiate and ink deals with fintechs directly than with Treasury Prime as the liaison.
“If that’s where the puck is going, let’s just go there right now,” Dean said, confirming a development initially reported by Jason Mikula, publisher of Fintech Business Weekly, on LinkedIn.
Treasury Prime is, first and foremost, a software company, he said, and the intention early on was that banks on its platform would find their own fintech partners.
“[But] the volume of fintechs that wanted to talk to the banks was far more than the banks could deal with, so they asked us to help and we ended up building out a whole go-to-market team for years to support that. We get lumped [into a category of middlemen], though we really don’t think of ourselves like that,” Dean said.
“And at some point [in the] last six months, we realized that what we wanted to do when we started, finally, both the regulatory environment and the banks have caught up to that. So let’s just do that directly. It’s better business. It’s better for the banks, it’s better for the fintechs, the regulators like it better, it’s better all around,” he said.
The layoffs came one year after a $40 million Series C round, which followed a year of triple-digit growth.
The 40 to 50 employees affected by the layoffs have received “healthy severance,” Dean said, adding that cutting staff was “like a body blow.”
“But if you look at from the business side of like, ‘Oh, dang, this is what everyone wants to do anyway, and this is where we make all our money. Why don’t we just do it that directly?’ Everyone’s asking me [if] we’re gonna run out of money. No, we have years of runway. This is not the issue here,” Dean said. “We’re just trying to reflect what the reality of the world is. When the problem changes, the answer changes, and the problem has changed the past few years.”