Centralway Numbrs, the Zurich-based fintech, plans to launch a global banking platform. But first, the company will cut or relocate a third of its jobs, information obtained by finews.com shows.
Martin Saidler has built Centralway Numbrs with a considerable personal financial investment, achieving a most respectable response from investors. The firm is a global distribution platform for banking products, a super market for customers of retail banking services ranging from loans to car insurance and funds.
«We have built a Swiss technology company with 150 highly qualified employees so far,» Saidler told finews.com at the beginning of the year.
Abrupt Cancellation of Contracts
Soon, it will be 100 employees. Centralway Numbrs in the final week of May abruptly terminated the contracts of about 50 of its staff. The people affected are programmers and other technical staff. Reason for the cuts are high development and personnel costs.
The company still doesn’t generate significant revenues with its banking app and the platform. Therefore, the fintech has to cut costs, eliminating jobs in Zurich or moving them elsewhere.
Zurich Has Become too Expensive
The move echoes similar decisions by other financial service companies in Switzerland that decided to reduce their Zurich-based staff. UBS, Switzerland’s largest lender, is shifting a large number of service jobs to regional centers across the country, away from the third-most expensive city in the world.
Centralway Numbrs says the reduction of jobs in Zurich is part of a restructuring process. Jobs will go in Zurich, but the company continues to hire programmers across the world who work from home – so-called remote workers, the company told finews.com.
Work Permit Issues
Centralway Numbrs confirmed the jobs cuts and said the restructuring was also due to the fact that it was difficult to hire non-EU personnel given the scarcity of work permits available for such staff in Switzerland. In that respect, Centralway Numbrs also is in direct competition to Google and IBM, both of which with seats in Zurich.
For the Zurich-based staff of the fintech, the cuts are hard to swallow. Some of the people released have only just moved to Switzerland. The company said it had informed the authorities about the job cuts.
Decision by New CEO Oanes
Centralway Numbrs in March appointed Oyvind Oanes as its new CEO (pictured below). Saidler handed over the operative responsibility to concentrate on strategic decisions and the development of the platform.
Oanes seems to have taken the decision about the cuts because of the firm’s financial situation. The app so far is only available in Germany.
Huge Company Valuation
Still, Centralway Numbrs at the beginning of the year attracted a new powerful investor in the shape of the state fund of Dubai, increasing the level of invested capital to $125 million. Further known investors are Marcel Ospel and Josef Ackermann, Pierre Mirabaud, Lombard Odier and Sir Ronald Cohen.
Saidler retains about 70 percent of the shares, putting the potential value of the company at almost $1 billion.
Top Offices, Skilled Staff – No Revenue
The money must be getting scarce though: Saidler has spent four years developing his application and the platform, without earning a single penny. The company turned into a small-to-medium-sized company with top-notch offices and highly skilled staff from across the world, mainly engineers and programmers who certainly received decent salaries.
Saidler personally financed a substantial part of the investments, but he hasn’t unlimited funds available either. Other investors also will demand to be kept informed about the development of their investments at regular intervals and would want to see a return on investment in due course.
First Contracts Signed This Year
Centralway Numbrs has reached its first agreements with three companies this year, generating an initial return: Postbank, Norisbank and SWK Bank, three German companies which make their products available via the platform. These contracts aren't enough to make the platform viable though.
The fintech will still take years to build a stock of customers and to internationalize its offering, justifying the valuation of the company and enabling the firm to return the invested capital with an appropriate yield.
