Synapse, a banking-as-a-service (BaaS) infrastructure provider, has laid off 86 employees (~40% of its workforce) on October 02, 2023. This was reportedly due to current macroeconomic conditions having unfavorable impacts on business circumstances, clients, and platforms.

Synapse will reportedly not be providing severance payments for affected employees; however, two of the company’s investors, CoreVC and a16z, intend to place employees in positions at other portfolio companies.

Analyst QuickTake: This marks Synapse’s second round of layoffs, coming nearly four months after its initial round of layoff (~18% of its workforce) as part of a restructuring initiative in June 2023. Meanwhile, the FinTech space has recently witnessed several companies downsizing their workforce as a cost minimization strategy to drive profitability amidst unfavorable economic conditions. Earlier this year, layoffs were seen in Marqeta (around 15% of its workforce in May), as well as Paddle and Finastra (in January). Meanwhile, we saw leading disruptors Plaid and Stripe laying off around 20% and 14% of their workforce late last year, respectively.