Background-Checking Giant Checkr Slashes Workforce by 32%, Despite $5 Billion Valuation

Checkr, a 10-year-old startup that offers employee background checks and was last valued at $5 billion in April 2022, has laid off 382 employees as companies are not significantly hiring talent. TechCrunch exclusively learned that Checkr conducted the layoffs across all departments and different levels on Tuesday. “In response to economic conditions that have impacted companies’ hiring, we made the difficult and painful decision to reduce the size of our team. This will allow us to operate more efficiently and ensure the long-term health of our business,” a Checkr spokesperson said in the statement. The job cuts — which affected 32% of the company’s workforce — came nearly two years after Checkr announced the acquisition of Inflection, the startup behind GoodHire, a background-checking platform for small- and mid-sized businesses.

Checkr, a 10-year-old startup that offers employee background checks and was last valued at $5 billion in April 2022, has announced a significant reduction in staff due to current hiring trends.

TechCrunch has exclusively learned that Checkr laid off 382 employees across all departments and levels on Tuesday. A Checkr spokesperson confirmed the layoffs in an email.

“In response to economic conditions that have impacted companies’ hiring, we made the difficult and painful decision to reduce our team. This will allow us to operate more efficiently and ensure the long-term health of our business.”

The job cuts, which affected 32% of the company’s workforce, come almost two years after Checkr’s acquisition of Inflection, the company behind GoodHire, a platform for small- and mid-sized businesses to conduct background checks. The Wall Street Journal reported the deal was worth $400 million.

Backed by renowned investors such as Durable Capital Partners, Fidelity Management & Research, Franklin Templeton, BOND, and Coatue Management, Checkr offers companies the ability to run background checks on potential employees through driving and criminal record searches and basic identity confirmation. The startup provides an online form or API integration with hiring and onboarding software, including Workable and Zenefits.

Founded in 2014, Checkr boasts customers such as Uber, Instacart, Netflix, Adecco, Airbnb, and Coinbase. By 2022, its customer base had grown to tens of thousands, ranging from small and medium businesses to Fortune 500 companies. Initially limited to Silicon Valley, the startup expanded its presence in 2016.

According to a Checkr spokesperson, the affected employees were given a minimum of 10 weeks of severance, health insurance, as well as career and mental health support. The startup did not disclose their runway or fundraising plans. To date, Checkr has raised $679 million, with the most recent round of $250 million announced in September 2021.

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Max Chen

Max Chen is an AI expert and journalist with a focus on the ethical and societal implications of emerging technologies. He has a background in computer science and is known for his clear and concise writing on complex technical topics. He has also written extensively on the potential risks and benefits of AI, and is a frequent speaker on the subject at industry conferences and events.

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