SALT LAKE CITY — Local tech company Canopy has cut about 60% of its workforce over the last nine months, according to an emailed statement from the corporation.
The Lehi-based tax software company laid off over 80 employees in March — leaving a headcount of about 170 — then just recently let another 73 employees go as the company underwent a “shift in product direction,” Canopy’s chief revenue officer and interim CEO Jordan Ray said in the statement.
The initial round of layoffs in March was a consequence of the board’s decision to “refocus efforts on the go-to-market strategy,” Avarell told the Deseret News earlier this year.
“Our previous, high-touch sales team worked very well, but for efficiency reasons … the decision was made to move to something more streamlined,” he explained.
The second round of layoffs was a “difficult decision” that resulted from a change in the company’s product direction, Ray told KSL.com in the statement, though he did not provide details on what that new direction would entail.
“We are deeply thankful to our employees and alumni for their contributions. While a transition like this is never easy, it is a positive step ahead for Canopy as we work to create a sustainable growth path for the long term,” he continued.
Ray also confirmed that Canopy's founder and CEO, Kurt Avarell, would be "transitioning to the next phase of his entrepreneurial career," though he did not provide details about how or why Avarell left the company and what that "next phase" would be.
“(Avarell's) vision of empowering accountants to work more effectively drives the team each day, and will continue to do so,” the statement reads.
In early 2018, Canopy received a tax incentive package from the Governor’s Office of Economic Development after the corporation estimated it would hire 530 employees over the next five years. The package is postperformance, however, meaning the company will not receive those tax rebates until after meeting its hiring projections.
Avarell told the Deseret News in March that the company has not yet applied for any rebates but is still able to do so during the five year period of the package. It is unclear whether the company will be able to meet the requirements needed for the rebates.
“Workforce shifts are a difficult yet common inflection point in a startup’s journey as they grow and scale. We’re confident in the plan Canopy’s leadership team has laid out to create sustainable success for the long term,” according to an emailed statement from Chad Packard with Pelion Venture Partners.
Avarell began coding what would become Canopy's software in 2014, and the company moved into brand new headquarters fairly recently.
After Canopy’s initial round of layoffs in March, a jobs fair event was held at Silicon Slopes’ headquarters in Lehi to help connect out-of-work employees with new opportunities in the Utah tech industry.
Avarell was an integral part in making that happen last time, said Silicon Slopes executive director Clint Betts. With the former CEO gone, Betts isn’t sure who might head it up from Canopy’s side, but Silicon Slopes will host another jobs fair for the employees that were recently let go, he said.
The details of the event have not yet been finalized.