Dataminr, the $4B Big Data Startup, Lays Off 20% of Workforce (150 Employees) to Focus on AI Growth

Dataminr, the New York-based big data unicorn valued at $4.1 billion, is facing a challenging day as it announces layoffs affecting approximately 20% of its workforce, translating to around 150 employees. According to a memo shared by founder and CEO Ted Bailey, the company is restructuring due to influences from the economic landscape, the need for operational efficiencies, and "the recent rapid advancements of our AI platform."

In the memo, employees were instructed to work from home while awaiting information on whether they would be among those laid off. Although the company had been hinting at a restructuring since October, specific details regarding the affected departments and the current state of the business remain unclear.

Bailey emphasized in the memo that these measures aim to "put Dataminr on a very strong financial footing moving forward." The company is poised to enhance its AI platform and product offerings, with plans to launch a new AI platform in Q1 that will merge predictive AI with generative AI. Despite the significant investment required, Bailey stated that today's actions will ensure “Dataminr will have multiple years of cash runway and a near-term path to profitability”—suggesting the company may not seek additional outside funding in the near future.

We have reached out to Bailey and the company’s media relations team for confirmation of the details provided by our source, who may unfortunately be impacted by these layoffs. A separate individual, who preferred to remain anonymous, corroborated these details. Meanwhile, LinkedIn is buzzing with posts from those who learned about the layoffs and are seeking new opportunities.

As we were preparing to publish, a spokesperson from the company confirmed the contents of the memo.

Founded in 2009, Dataminr gained prominence during the rise of companies leveraging innovative data techniques to analyze unstructured data from social media, pairing it with other structured sources to yield insights on public sentiment. Dataminr adapted this model to deliver real-time insights about global events and breaking news, effectively tapping into social media platforms where users shared updates as events unfolded.

This approach, while invaluable, has not been without controversy regarding the data it harvested and its applications. Nevertheless, Dataminr has forged significant partnerships with companies like Twitter and has served customers spanning government, enterprise, financial services, and media sectors.

During the fervent fundraising era of the 2010s, Dataminr secured substantial investments, reaching a valuation of $4.1 billion following a $475 million funding round in 2021. To date, the company has raised over $1 billion from more than 100 investors, including Fidelity and Morgan Stanley, as well as Venrock and IVP. Notably, Twitter, now named X, was previously an investor but has since divested its stake. PitchBook reports that Dataminr raised undisclosed sums in two funding tranches over the past year.

Dataminr has consistently employed a significant number of subject-matter experts alongside engineers and sales specialists. In recent years, the company has intensified its focus on AI technology, potentially facilitating its ability to downsize without adversely affecting business operations.