Uptake Technologies laid off 51 employees Tuesday at its Chicago headquarters, co-founder and CEO Brad Keywell said in a statement.
These are the first layoffs at the 3-year-old company, which focuses on analyzing data from machinery. The announcement comes after two companies recently ended their investments in Uptake, which last year secured a valuation of $2 billion, placing it among the high-value startups known as “unicorns.”
“We move forward with an even more precise focus on building and deploying actionable insight products that create impact for global industry,” Keywell, a co-founder of Groupon, said in the statement. “This was a difficult, but necessary, decision to best serve the needs of Uptake and our customers.”
The layoffs, announced to employees Tuesday morning and accounting for about 6 percent of the company’s workforce, were effective immediately.
Spokeswoman Abby Hunt declined to comment on which department or departments the affected employees worked in, but she said the layoffs were in part a result of an effort to make sure workers with the right skills are in place as the company continues to grow.
Uptake continues to recruit and hire “to fill positions that are critical to our long-term growth,” Keywell said in the statement. Uptake declined to make Keywell available for further comment.
Since launching in 2014, the startup has expanded to analyze data in 10 industries, including agriculture, aviation, mining and energy, according to the company’s website. It has raised about $146 million in funding overall, according to research firm Crunchbase. Investors include Revolution Growth, a Washington, D.C.-based venture capital firm headed by AOL founder Steve Case; Chicago-based GreatPoint Ventures; and Lightbank, Keywell and Groupon co-founder Eric Lefkofsky’s venture capital firm.
In November, Caterpillar ended its investment in Uptake, though it remains a customer. The heavy equipment manufacturer took an early minority stake in the startup and has been gathering data from its machinery using Uptake’s technology in an effort to make that equipment more efficient for customers.
About a month later, Chicago private equity firm Valor Equity Partners also ended its investment in Uptake, three months after putting $35 million into the company.
Meanwhile, Uptake raised $117 million in its latest round of funding, which was announced in late November. That round was led by U.K.-based investment management firm Baillie Gifford.
Uptake now employs about 750 people, most of whom are at its headquarters in the Goose Island neighborhood, Hunt said.
The company isn’t the only unicorn based in Chicago that is experiencing setbacks.
In November, big-name investors sued Outcome Health, CEO Rishi Shah and President Shradha Agarwal, alleging fraud as the company secured $487.5 million in funding and rose to a valuation of about $5.5 billion. Since then, about a third of Outcome Health’s employees have accepted buyouts. The company, which places screens in doctor’s offices that run educational content about health topics and advertisements from drug companies, also canceled plans to relocate and expand its corporate headquarters.