Dapper Labs lays off 51 in third major cut since November

Dapper Labs has laid off 51 staff members, a tweet from the company’s CEO Roham Gharegozlou reveals.

The employees leaving the Web3 outfit are both full-time workers and C1 contractors, the company released in a statement. Some of those staff members will stay on to work with the organization in a part-time capacity.

The cuts are the third major round of layoffs since November 2022, when the outfit first let go of 134 employees: nearly one-quarter of its staff. It cut 94 more employees in February this year, which equated to roughly 20 percent of its workforce. LinkedIn lists the number remaining of Dapper employees at 356, meaning this latest series of layoffs represents a near 15 percent reduction in staff.

“The decision was incredibly difficult because of the amazing people affected, but it is necessary and the right thing to do to ensure a lean and efficient Dapper Labs,” said Gharegozlou in a note to the company. “We are setting the company up to both serve our customers in a sustainable way and to innovate and push the boundaries of technology forward for many years to come.”

Dapper Labs was founded in 2018, and was responsible for CryptoKitties — a game to breed digital cats — as well as the ERC-721 standard token, which is the foundation for all NFTs. Its latest venture is NBA Top Shot, which at one point did $50 million in sales in 30 days.

Despite the ongoing “crypto winter”, Gharegozlou suggests that the latest round of layoffs is not due to financial hardship. The CEO says that Dapper Labs and Flow — the company’s blockchain architecture — are “well-capitalized to pursue our mission,” adding that “Flow is also funded with a separate pool of capital, so that team has several years of cash runway with no need to sell tokens to fund short-term operations.”

Dapper Labs is still facing a high-profile lawsuit that alleges the company wrongfully sold its NBA Top Shot “Moments” as unregistered securities. In addition, during the last round of layoffs in February this year, the CEO drew attention to how its revenue had fallen between 2021 and 2022, despite consistent launches of new products. (Dapper Labs is not alone in this crash in sales and trading of Web3 assets, which has been affecting the industry since last summer.)

The company has created a list of individuals who have been laid off and are available to hire, which it says will be available today.