Israeli-Singapore Retail Analysis Company Trax will start cutting more than 100 employees over the next few days, 12% of its workforce, in a bid to become more profitable than previously planned. Several dozen employees in Israel are expected to lose their jobs.
Trax provides marketing chains with technology based on computer vision and robots that help prevent supply shortages. The company’s system provides signals when a product is out of stock so that the shelves can be refilled and delivery orders can be fulfilled. Trax has been hit by a contraction in the retail food business, which has affected other companies such as food delivery company Avo, which has closed operations in Israel.
Jox Bar-El, co-founder and CEO of Trax, said: “We have enough money in our coffers. This allows us the freedom to work and the ability to plan our future in the best way. Our streamlining measures are not driven by a lack of money, but the desire to make the company profitable faster than we planned by acknowledging that on the day we can hold an IPO, profitability criteria will be very important to investors. The measures have nothing to do with the funds we have raised. “
In April 2021, Trax raised $ 640 million, led by Vision Fund 2 of SoftBank and BlackRock, valued at $ 2.6 billion. $ 300 million was used for investment, and the rest was used to buy shares from existing shareholders in a secondary transaction. The company has raised $ 975 million so far.
Bar-El added: “Following the situation in global markets, which has declined dramatically many times, and because we believe it will be difficult to raise additional capital in the next 18 months to two years, we decided to embark on this process. We decided to reduce the less profitable product lines. It is important to emphasize that salaries are not affected, nor are employees’ conditions. We will take care of the employees who leave us and we will pay them higher salaries than required by their number of years and experience, as well as assistance in finding new jobs. “
Would you still have raised $ 2.6 billion last year if you didn’t have the situation you are in now?
Absolutely. It reflects our value. We also maintain an ongoing dialogue with global investors and have even recently received an investment proposal for such an assessment. If we were a public company, then maybe our price would be severely affected. But as a private company, we can choose investors who are willing to pay for an investment they believe in. “
You work in the retail market and indirectly in the e-commerce sector, which has been hit hard in recent months. Do you see this change in demand?
“We are growing by 40% on an annual basis and this year we will continue to develop. Despite the rationalization aimed at unprofitable products, we will continue to hire workers for other flows. “
This is not the first round of layoffs from Trax, which has 950 employees. In January 2021, the company laid off more than 30 employees in Israel, and in May 2020, 100 employees worldwide. Some of the cuts were followed by acquisitions that include US company Shopkick and French company Qopius.
Posted by Globes, Israel Business News – en.globes.co.il – on June 20, 2022.
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