February 6, 2023
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Apeel laying off 96 in second round of the year

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Goleta-based Apeel Sciences will lay off a large portion of its workforce, mainly in the Santa Barbara County area, in its second major round of layoffs this year, the company has disclosed.

Goleta startup Apeel Sciences is a leader in ag sustainability because its coatings extend the shelf life of produce such as avocados.

Apeel will lay off a total of 96 employees from its Goleta office, according to a company filing with the state of California. 

The state received the Worker Adjustment and Retraining Notification, known as WARN, the day before Thanksgiving.

The state’s WARN Act requires employers to file a notice when laying off more than 50 employees in California, or when shutting down an entire facility.

Apeel filed three separate notices, each indicating a separate number of layoffs. 

The filing said the company will lay off 71 employees by Jan. 15, another 11 by March 31 and the final round of workers, 14, by June 30. 

In total, Apeel plans to lay off 120 workers across North America, Europe and South America, according to a company spokesperson. 

Asked if the company will be shifting its headquarters to another location following the layoffs, Apeel said it is “not moving.”

“Santa Barbara played an important role in our origin and will continue to do so moving forward,” the spokesperson said.

This is the second time this year Apeel will be downsizing.

On July 11, the company announced it would lay off an unspecified number of workers and significantly downsize its operations for the first time in its history, after years of continued growth that took it past a valuation of $2 billion in its last funding round.

In a statement provided to the Business Times, a spokesperson for the company said many of those layoffs took place immediately.

Moreover, the majority of those impacted were based outside of California and were spread across several departments, Jason De Turris, Senior Vice President at Apeel, said at the time. 

As a result, the company didn’t have to make a WARN act filing with the state during that round of layoffs.

But this is the first time Apeel will be laying off from its office located at 71 South Los Carneros Rd.

Asked about the need to have two rounds of layoffs this year after previously having none, Apeel said, “We developed some inefficiencies that needed to be addressed for the future of our business.”

“We were admittedly optimistic about the position we would be in following the previous layoffs and we underestimated economic headwinds and the extent to which we’d need to restructure to ensure the future of our company. It is never easy and there is no good way or right time to do a layoff, but we felt it was necessary to take this step now,” the spokesperson said.

As of Feb. 25, Apeel had about 450 employees globally, but the company declined to update those numbers when asked.

Apeel was founded by UC Santa Barbara researchers in 2012, with a technology that extends the shelf life of fresh produce.

Apeel has raised $635 million in venture capital, from investors including Oprah Winfrey and the Bill & Melinda Gates Foundation. 

In its latest funding round of $250 million, in September 2021, the company was valued at more than $2 billion. 

In February, CEO and co-founder James Rogers told the Business Times that Apeel had no plans to raise more capital in 2022. Rogers could not be reached for comment on Nov. 29.

Other companies also see layoffs

Apeel is also the latest technology company to announce major layoffs in the past few months — a trend that the tri-counties has largely escaped, even as the nation hasn’t.

San Luis Obispo-based MindBody announced Oct. 26 that it would lay off an unspecified number of workers. 

The Business Times later reported that the company, in fact, laid off 400 employees. But it could not be determined how many were from the San Luis Obispo office.

The only other tri-county-based technology company to announce layoffs so far this year was Santa Barbara-based Impact.

Impact, a digital marketing platform, cut 10% of its workforce in August.

Impact CEO David Yovanno said the company had more than 1,000 employees nationwide and 120 in the Santa Barbara office, so a 10% job cut would mean about 100 layoffs.

Yovanno said in a statement in August that “we do not take these job cuts lightly,” and the company took a slew of measures — including cutting executive leadership’s pay by 15% — to avoid layoffs, but the headwinds around the e-commerce industry are “worsening” and “could not have been predicted.”

Apparently, those headwinds could not be predicted by many technology companies.

As of Nov. 29, more than 100,000 technology employees have been laid off — many by major companies, according to Crunchbase.

Most recently, Amazon announced 10,000 layoffs on Nov. 14. It has not been confirmed if any of those layoffs include some from its tri-county operations.