Verily is seen on a laptop in an arranged photo taken in Arlington, Va., on Thursday, May 7, 2020.
Andrew Harrier | bloomberg | Getty Images
In an email to employees on Wednesday, Verily CEO Stephen Gillett said the company will lay off 15% of its staff in a restructuring move, as it strives to achieve financial independence from its parent company. the alphabet. A Verily spokesperson confirmed that the cuts will affect about 240 people.
Verily, which specializes in health sciences, is a sister company of Google, and operates within the “Other Bets” category of Alphabet.
It’s the first known layoff to hit Google’s parent company in the wake of a wave of layoffs in the industry and fears of a recession. Although Google has so far avoided the large-scale job cuts that have hit other tech companies like Meta, employees are becoming anxious if they could be next, CNBC reported.
Gillette’s email directed employees to work from home for the rest of the week as Verily’s physical offices will be closed Thursday and Friday. “Those who are in the office today can now go home,” it stated, noting that the instructions also apply to employees who work from Google offices.
Some of Verily’s projects included contact lenses that can detect symptoms of diabetes, which were discontinued in 2018, and Project Baseline, an effort to aggregate health data with research organizations. It also provided the Covid-19 testing platform, which former President Trump highlighted at the start of the pandemic.
Some of Alphabet’s other bets include its equity structure, CFO Ruth Porat explained in 2019, and Verily has been raising money from outside investors for several years. In 2017, Verily acquired $800 million in offshore capital from Singapore-based Temasek, and has since raised more than $2 billion in several equity rounds.
Gillett said the cuts reflect the discontinued programming and the “redundancy” of the team, according to emails seen by CNBC. It says it will offer severance and outplacement services “in the coming weeks and months” but has yet to provide details.
Gillette’s memo said it would “reduce or alienate” some parts of the business while investing more in others. Specifically, Verily will discontinue certain early-stage products, including “remote patient monitoring for heart failure and microneedles for drug delivery,” the email read. “We can’t do everything and we had to make some tough choices,” Gillette wrote. The email said the company will hold a plenary meeting on January 18 to explain the changes in more detail.
Gillette’s memo also details several executive changes and the departure of Gordy Paramon, Verily’s head of hardware businesses who had been with the company “since its early days.”
The memo stated that the company would notify the laid-off employees with an email sent to their and personal emails titled, “Important Update Regarding Your Role.” Those who still have jobs will receive an email with the subject line “Your role at Verily”. The note stated that those who work outside the United States will hear from their business leaders on Wednesday or Thursday.
“While communication via email is not ideal, this was a deliberate decision, enabling us to communicate as efficiently and simultaneously as possible. We also take the day and the rest of the week to ensure each affected Veep has a personal discussion with a leader and a partner HR to discuss details, answer questions, and provide support through the transition process,” read the note.
“As we move into the next chapter of Verily, we are doubling down on our goal, with the goal of ultimately working across all areas of precision health,” the memo stated. “We will do this by building a data and evidence backbone that bridges the gap between research and sponsorship. We will also focus on building a financially independent company and a thriving company culture.”
Alphabet and Verily declined to comment further.