Logistics unicorn Flexport is in a state of flux right now—and that means it’s had to retract dozens of job offers just a few days before some of the new hires were due to start work at the company.
In a series of posts to the X platform on Friday, Flexport’s founder and CEO Ryan Petersen—who, at the time of posting, was just hours into the job—apologetically explained that the move was necessary to get the firm back on track as it looks to tighten its purse strings.
“Flexport is rescinding a bunch of signed offer letters for people who were starting as soon as this Monday,” Petersen said. “I am deeply sorry to those people who were expecting to join our company and won't be able to at this time. It's messed up. But no way around it, we have had a hiring freeze for months I have no idea why more than 75 people were signed to join.”
While he acknowledged that he was personally receiving “a lot of criticism” for rescinding the offers, Petersen argued it was “one of the easier decisions that I have to make right now to get Flexport back to profitability.”
A spokesperson for Flexport did not immediately respond to Fortune’s request for comment.
'I hope you will forgive us'
Addressing the people who would no longer be joining the firm, Petersen explained that they would each be contacted personally by a Flexport team member to discuss the rescinding of their employment offers.
“I hope you will forgive us someday and even consider coming to work here again once we get our house in order,” he said. “But now would not be a good time to add more people and expenses to the company.”
He also promised the company was taking steps to help those it had turned away find alternative employment, and offered to host a “speed dating” event to match those whose job offers had been revoked with prospective employers.
“We've created what I think is a pretty generous stipend for candidates whose accepted offers we've rescinded,” he said. “And we're pivoting our entire recruiting org to helping these awesome people land on their feet with great companies. If your company is hiring tech or logistics talent and wants to connect with pre-vetted people who cleared Flexport's very high bar, DM me and I will get you into the process that we've created to match these great folks with companies that are hiring.”
Some of Flexport’s investors, Petersen added, were offering to assist those being turned away find alternative employment, while “over 100 companies big and small have reached out eager to meet folks” who had been impacted by his decision. Those firms included Palantir and Shopify, he said.
So far 7 different VC funds that have invested in Flexport have offered to help candidates fast track connections with their portfolio companies to make sure these great people land on their feet. We truly have the best investors in the world, making us all proud. 🙏🙏🙏
— Ryan Petersen (@typesfast) September 8, 2023
Meanwhile, the vast majority of the 200-plus open roles that, until recently, were being advertised on Flexport’s careers site had been taken down, Petersen said. He noted he had been perplexed by why those positions had been posted in the first place given the company-wide hiring freeze.
“All of those [open jobs] have been canceled except for a handful of roles directly tied to our most important initiatives,” he said. Those initiatives included roles dedicated to functions like improving the timeliness of Flexport’s freight services.
As of Monday morning, Flexport had 53 openings on its careers page.
Returning CEO
Petersen’s clampdown on hiring at Flexport came two days after he stepped back into the chief executive role following the departure of CEO Dave Clark.
Clark—a former Amazon executive who left the e-commerce giant after being passed over for CEO in favor of Andy Jassy—had been in charge at Flexport for less than a year.
He was reportedly fired from Flexport because Petersen changed his mind about his appointment.
According to Bloomberg, six senior Flexport employees—the majority of whom were Amazon alumni—left the company after Clark’s sudden ousting.
Earlier this year, the supply chain startup laid off 20% of its global workforce, with Clark and Petersen telling employees at the time that the company needed to be “nimble” and “fiscally responsible.”
Flexport raised almost $1 billion in funding last year with backing from Shopify and Michael Dell, bringing its valuation up to $8 billion.
After Clark left the company last week, Petersen told Flexport workers in an internal memo that while the company had more than $1 billion in net cash, “it’s clear that important changes are needed to sustain our growth and return to profitability.”
“Flexport sits at a crossroad where the choice is either to spend our way out of the current downturn in global logistics or pursue a path that gets us back to profitability quickly,” he added. “The board and I agree that operational excellence and profitability in the near-term is the right path.”
