When one of event tech’s largest providers makes the difficult decision to cut almost a third of its staff it sends shivers down the spine of everyone working in the sector.
Event tech platform Bizzabo announced on Tuesday it will be cutting almost 30 percent of staff in what it calls an organizational shift in order to improve its profitability.
“Many companies, like Bizzabo, are adjusting their strategies to prioritize financial efficiency as we face an economic downturn and possible recession. In times like these, focus becomes paramount,” said Bizzabo co-founder and Chief Marketing Officer Alon Alroy.
The U.S. and Israel-based company started as a mobile event app focused on networking, Bizzabo developed into an event management and marketing platform before the Covid pandemic. Like most event tech companies pivoted by integrating video streaming to support virtual and hybrid events.
Bizzabo has to date raised close to $200 million. A Series E round of funding in December 2020 of $138 million made up the bulk of this. The company is among the best-funded event tech companies, money which has since been used to acquire at least four complementary technologies that it has been working to fully integrate into the Bizzabo platform. According to LinkedIn data, it previously ranked in the top 5 for largest headcount in event tech.
Bizzabo ran a successful event tech business pre-pandemic, something that cannot be said for Hopin and other companies that were formed in 2020 and 2021. Still, Bizzabo bulked up headcount during the pandemic to match client needs for virtual events. Now, while Alroy remains confident that “events will continue to be a vital part of the business world”, the current market conditions means that Bizzabo are needing to find alternative ways to match their ambitions.
In a statement shared with Skift Meetings, it is clear that Alroy remains confident that Bizzabo will be able to pivot in response to client and market needs. There are no plans to pivot away from virtual events and will continue to invest in video technologies. Alroy is also confident that wearables, presumably through integrating Klik acquired in November 2021, will play an important role in making in-person events more data driven.
Bizzabo shared the bad news publicly via a blog post and on LinkedIn via all three co-founder’s personal profiles. “Today was one of the most challenging days we’ve faced since founding Bizzabo,” was the first line of all three LinkedIn posts. They were well received with comments including commiserations from fellow event tech entrepreneurs and notes from companies hiring. Some of the employees laid off also commented with appreciative messages.
“It was a difficult decision, but it is the right decision for Bizzabo’s employees, clients, and shareholders,” reads one whole paragraph in the blog post. It hints that pressure from shareholders to make staff cuts is certain to be a factor leading up to this decision. The same post also makes several statements regarding the company’s focus on client success.
Bizzabo has committed to helping the ex-staff find their next opportunity. Israeli tech publication CTech reports that Bizzabo will provide increased compensation packages and has set up a team to assist departing employees and offer professional and psychosocial support.
This news is a worrying sign for event tech in general. As companies continually reassess their strategy and market positioning it is becoming clear that the sector will contract. Whether it contracts back to 2019 levels or stabilizes with a larger market share is anyone’s guess.