What the business is
San Francisco background-screening platform checking driving and criminal records and identity via a form or API for employers
The bet
Checkr's growth, including the roughly $400M Inflection purchase, depended on employers continuing to hire
Starting capital
$679 million raised in total; the last round was $250 million in September 2021
How it started
Founded in 2014, Checkr serves Uber, Instacart, Netflix, Adecco, Airbnb and Coinbase and had tens of thousands of customers in 2022. In 2022 it was valued at $5B and announced the acquisition of Inflection, GoodHire's parent, which the Wall Street Journal reported at $400M.
What happened
By April 2024, with companies not significantly hiring, Checkr had a hiring-linked business facing weak demand. It did not answer questions about its runway and fundraising plans.
How it ended up
On Tuesday 9 April 2024 Checkr laid off 382 employees, 32% of its workforce, across all departments and levels, and a spokesperson confirmed it, calling it a difficult and painful decision to operate more efficiently. Affected staff got a minimum of 10 weeks of severance and health insurance, plus career and mental health support.
What has to be true
Checkr said economic conditions had impacted companies' hiring
Its checks are run when customers hire, so lower hiring cuts its volume
Its last round was in September 2021 and its valuation was set in April 2022, at the peak of hiring
The company said it wanted to operate more efficiently for long-term health
What can be applied
A business tied to the hiring cycle is exposed when customers stop hiring; cuts across every department reflect a volume problem, not one underperforming team.
Aftermath
As of 2024-04-10, Checkr had cut 382 jobs, 32% of staff, with at least 10 weeks of severance, and had not disclosed its runway or fundraising plans.
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