OpenMoney confirms 50 lay offs
The new owners of Manchester-based fintech OpenMoney have acted swiftly to dramatically cut costs at the loss making business.
Will Mallard, who purchased the distressed business at the 11th hour and applied to place the business into a CVA told TheBusinessDesk.com that processes are now underway to let 50 staff go.
That leaves a vastly reduced workforce from the 70 who worked there until two weeks ago, and almost 100 at its peak.
He said: “The Open Money Ltd company has paid all of the wages for April.
“Over fifty staff have been placed on lay-off in the OML business and a statutory consultation process has been initiated with employees, who will elect representatives to manage the way through an uncertain situation.
“A process on the proposed business restructuring is progressing with creditor input.”
The business is being run day to day by his business partner Patrick Leahy as the acting chief executive. He confirmed that several of the former leadership team remain on sick leave since the sale.
He claimed the other businesses are doing well and that acquisitions of independent finance advice firms were part of the future strategy for the business.
“The Open Money Advisory business has begun active discussions to acquire IFA firms as part of its expansion. Its regulated online mortgage brokerage is a key part of the growth plan,” he said.
“The Work Life employee benefits and financial well-being business similarly is set to grow with a key partnership being negotiated and sales teams being deployed with new offering.”
A fintech business, Open Money was set up by Anthony Morrow in 2017 with the backing of former MoneySuperMarket founder Duncan Cameron. Morrow has been seeking a buyer for the loss making business after Cameron pulled all funding at the end of March giving his former business partner Anthony Morrow the impossible task of finding an alternative funder.
According to the last set of filed accounts the shareholders capital stands at £28m, indicating how much investment Cameron and Morrow have sunk into the business which lost £9.3m in 2021 on turnover of just £593k.
Cameron sold his 47% stake in the Chester-based price comparison site to co-founder Simon Nixon in June 2007 for £162m.
At the request of Will Mallard, this story was amended to state that wages for April had been paid, not May.