IronNet, a Cybersecurity technology developer, announced that it is laying off about 55 of its employees, making it the latest tech start-up to reveal major layoffs. This may be a sign that valuations in cybersecurity may have peaked. IronNet stated that the reduction in its workforce is part of a broader plan by the Company to streamline its operations for higher efficiency, to reduce overall expenses, save money, and set the Company up for rationalized growth going forward.
In an email to CRN, IronNet noted that it planned to evaluate all expenses to accelerate the time frame to achieve a cash flow neutral financial position into next year. It also stated, in its filing papers, that it sees no change to its outlook or customer pipeline as it looks to increase efficiency and set the Company up for rationalized growth going forward.
IronNet continued to assure that its strategy has not changed; they still intend to transform cybersecurity through Collective Defence. They further stated that they had seen momentum around the concept of Collective Defence in the past several quarters, as President Biden and his cyber experts even referred to it as the “path forward”.
News of the layoffs came soon after IronNet released its first fiscal quarter 2023 financials. The Company reported a slight increase in revenue from the previous year. However, it also reported a GAAP net loss as compared to the previous year. The Company said the drop in revenue was due in large part to delays in renewing contracts by some of its large customers.
Layoffs at IronNet and other tech start-ups come when labour markets are tight, making it hard for tech companies to source enough talent. Apart from IronNet, other companies that have reported layoffs include OneTrust, which laid off about 950 people, Cybereason, which laid off 10% of its workforce, Lacework, which plans to lay off about 20% of its workforce, Deep Instinct which laid off 10% of its workforce, and Automox which laid off about 18% of its staff.
– Kelly Lekaise (Candidate Attorney at PPM Attorneys, South Africa)
Edited By: Prakhar Tripathi.