Dapper Labs founder and CEO, Roham Gharegozlou, revealed late on Wednesday that the renowned Web3 studio had cut its staff by 22%. In less than two years, the company went from 100 to over 600 employees, according to the CEO, who also claimed that this rapid growth prevented Dapper Labs from being “as aligned, nimble, and community-driven as we need to be.”
“These reductions are the last thing we want to do, but they are necessary for the long-term health of our business and communities,” Gharegozlou wrote in a letter to employees posted publicly online. “We know web3 and crypto is the future across a multitude of industries… but today’s macroeconomic environment means we aren’t in full control of the timing.”
Dapper Labs’ decision comes amidst a slumping NFT market condition
The announcement follows news that NBA Top Shot, the most well-known NFT marketplace operated by Dapper Labs, experienced a nearly two-year low in monthly sales as a result of a general decline in the digital collectibles market.
In his team letter, Gharegozlou detailed the leadership’s approach to the layoffs at Dapper Labs, outlining how they examined each business line to see if each initiative advanced the mainstream adoption of Web3 and if it fit within the company’s core competencies.
Just a few years ago, Dapper Labs was experiencing great success thanks to the cryptocurrency boom. The company introduced the hugely popular CryptoKitties project in 2017, and it later implemented the Flow blockchain to improve NFT transactions.
The business also recently finalized a number of high-profile agreements, such as the NFL All Day football version of NBA Top Shot and the creation of NFT tickets with Ticketmaster.
The company is highlighting ways it plans to assist those who lost their jobs with today’s announcement.
“We have worked to create a package of benefits so you can receive compensation, health care, and other benefits from Dapper Labs while you seek your next opportunity,” Gharegozlou wrote in an effort to support departing team members.
The layoffs at Dapper Labs are just the most recent in a long line of workforce reductions in the sector. To survive the bear market, businesses like BitMEX, Digital Currency Group (DCG), and NYDIG have all recently reduced headcount.
