Less than a year ago, many Australian investors were pressing buzzy start-ups to spend money faster to improve their growth trajectories. That has changed rapidly as rising inflation triggers quick interest rate rises and investors scale back the pace of their dealmaking. Cutting costs and chasing profitability has become a priority.
Eucalyptus’ layoffs are across the entire company, but Doyle said it would postpone some of its most ambitious and expensive long-term bets, such as delivering mental health support and physical clinics rather than relying purely on telehealth.
He paid tribute to the staff who will be leaving the business in coming days after a consultation process, saying they were “hugely talented”. And he emphasised that Eucalyptus was still performing well.
“We’ve historically grown a business in excess of 100 per cent year-on-year since we began and that remains true today,” Doyle said, though he declined to provide metrics such as cash on hand or revenue.
“We certainly have at least 12 to 18 months to figure things out,” he said.
Eucalyptus last raised $60 million late last year in a round led by the US venture capital firm BOND and a group of local investors.
Comparable overseas start-ups have also faced struggles. US-based Ro, which has been valued as high as $US7 billion, cut 18 per cent of its workforce last month. Him & Hers Health, which is listed, has lost 75 per cent of its market capitalisation since a peak last year.
One Eucalyptus employee, who spoke anonymously and faces a potential redundancy, said the company’s founders had “handled it really well” and been transparent despite the hard circumstances.
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