Israel-based performance marketing company Matomy Media Group is shedding 40 of its staff as part of a restructure designed to focus on activities with “the most potential for sustained growth and profits”, according to the company’s new CEO, Sagi Niri.
The layoffs, which represents 10% of the company’s total 400-strong headcount – half of which are based in Israel, where most of the layoffs will occur – saw Matomy Media’s share price rise 1.7%.
“Matomy has to stay agile and develop quickly in response to changes in the industry,” commented Niri, “With a sharp focus, we are consolidating our strengths and generating most of our revenue through the technological platforms we own.”
According to the group’s statement, Matomy plans to exit from non-core activities before the end of the third quarter this year, calling the restructuring a bid to achieve a leaner, more flexible cost structure, with an “immediate effect on overall profitability” – it claimed that it will save “over $10 million a year”.
Niri added that while “not an easy” decision, it was “essential and strategic” to ensuring Matomy remains a leader in performance marketing, and expected it to have an “immediately significant” positive impact on the group’s profit margins.
Having built the company from inception to a $277 million business as of last year – as well as leading the acquisition of MobFox, Media Whiz, Team Internet and Optimatic - former CEO and co-founder Ofer Druker stood down from the helm last month to “pursue new challenges”.
His departure, however, followed alleged assertions by shareholder Brosh Capital that his management “lacked strategy” in the wake of an $11 million net loss in 2016 and the fall from its $350 million IPO valuation in 2014. Concerns initiated the appointment of Niri, the group’s former COO and CFO, tasked with returning the company to profitability.
Interestingly, Brosh claims the smallest stake in Matomy with 7%, behind Publicis Groupe (24%), entrepreneur and former chairman Ilan Shiloah (12%) and the Viola Group (9.8%).