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- MoneyLion went public through a SPAC in September. Its share price has fallen 80% since then to $1.58.
- The company acquired Malka Media and Even Financial months later to expand its product offering.
- MoneyLion’s CEO told Insider that the integration made some jobs at MoneyLion redundant.
Personal finance app MoneyLion is looking to grow just a year after going public. However, high turnover and a falling stock price pose challenges for the New York-based startup.
Its CEO and co-founder Dee Choubey is betting that its two latest acquisitions will help right the ship and make the startup the go-to app for financial content. The company acquired Malka Media, a digital media company, last November and months later acquired Even Financial, a financial services marketplace, in February.
The integration of acquisitions led to several layoffs. Choubey said the company has laid off 2 percent of its American staff this year. For a company that has over 400 employees located in the U.S. out of its 751 worldwide, this amounts to approximately 10 employees. Separately, Insider found that a total of more than 65 people left MoneyLion and its two subsidiaries during that period through LinkedIn analysis. A former product employee who left in June told Insider that employees, some of whom were managers, were let go as far back as February and as recently as July.
“When you acquire two companies, there are some opportunities to consolidate shared services,” Chobey said.
Chobey told Insider that the market environment had little impact and the company would still make layoffs. “It’s never an easy decision,” he said, “but just for efficiency in getting the teams to work together, we’ve certainly made some moves on the personnel side,” he told Insider.
He believes MoneyLion can be the ultimate destination for curated personal finance content. To help with this, the company acquired Malka for its own production studios located in Los Angeles and Jersey City, and the company’s network of content creators and influencers, including professional athletes. Having a studio reduces production costs for a company that wants to produce content through its own platforms and those of its partnerships. Access to content creators and influencers gives the company “ambassadors” who are expected to promote MoneyLion to their followers on other platforms.
The personal finance startup bought Even Financial for its referral engine that plays a digital matchmaker between financial products and consumers. Dory, launched in 2015, has a network of over 1,000 companies that includes SoFi and LendingClub.
“Widgets that exist on websites like CNBC.com or Insider.com are often powered by us. And that allows us to see massive amounts of intent data,” he said.
This intent data, behavioral data that shows what a user is interested in, is fed into MoneyLion’s other products and services, helping to improve them for users.
MoneyLion, founded in 2013, went public in 2021 through a SPAC deal with Fusion Acquisition Corp. that valued the company at $2.9 billion. Its share price has since plunged 80% and was trading at $1.58 a share on Tuesday morning, bringing its market capitalization to just under $400 million.
CEO Choubey told Insider in December that he thought it was “a broad changing of the guard, if you will, where stocks are moving from short-term speculative hedge funds or people who trade this SPAC asset class, more to long-term term holders.”
Equity markets have had a rocky year so far, with technology companies particularly hard hit. MoneyLion shares are no exception.
“Things have changed with interest rates going up, and the iron law of interest rates has really modulated the way investors think about risk,” Chobey said in August.
However, the company is thriving in other ways, he said. It has 5 million customers using its financial accounts, according to recent earnings. Almost double the 2.7 million in December. And despite a high budget of expenses that overshadowed the income, its balance sheet stood at $217 million. Choubey revealed that MoneyLion expects to burn through about $30 million in the second half of the year, leaving it with more than $100 million for 2023.
“Even by the end of the year, we’re still coming out with a significant amount of money,” Chobey said.
The company aims to reach $1 billion in revenue by 2025, the executive told Insider. Its second-quarter earnings report showed the company estimates it will top $330 million by the end of the year, a 103 percent increase from $165 million last year.
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