Siloto Start of the Bay Area Food Supply Chain, has gone through a bad streak. TechCrunch has learned that the company laid off approximately 30% of its staff, or more than two dozen employees, on Tuesday. Silo confirmed the staff reductions, clarifying that the cuts were across the board and did not focus on individual departments.
Silo shared the following statement with TechCrunch regarding the layoffs:
We recently made the difficult decision to reduce our workforce by almost 30%. We are committed to supporting affected team members and have provided severance packages and hiring support. At the same time, Silo remains dedicated to serving our customers and the perishable industry as a whole, and will continue to focus more nimbly on creating next-generation supply chain management software solutions.
Founded in 2018, Silo’s platform helps automate workflows of food and agriculture businesses and then expanded to other areas, such as payment products for accounts payable and receivable automation, inventory management, bookkeeping, financing, and more.
Before the layoffs there was an issue involving a credit product that had hurt Silo’s revenue. A company source confirmed that a customer had fallen behind on their loan, causing Silo’s banking partner to suspend the loan product. Silo then worked with the bank to resolve the issue with the customer so the facility has the ability to finance again.
While Silo is now able to lend, that customer’s non-payment and general pause in lending meant a drop in revenue during that period, leading to layoffs. For that reason, Silo will likely be careful about increasing the loan product as it moves forward.
All of this happened in the last few weeks. However, it is possible that if Silo had implemented more robust risk management processes, it would not have faced non-compliance.
Additionally, we hear that Silo is engaging in discussions about mergers and acquisitions as another possible solution to its current situation. The company had entered into talks with potential partners ahead of its Series C last year, but the fundraising allowed Silo to pause those talks for a while. In recent weeks, those M&A discussions have resumed thanks to the new growth the company experienced last year, as well as the potential need for an exit.
startup raised $32 million in Series C funding last summer. Investors include Initialized, Haystack, Tribe Capital, KDT, a16z and others.