Digital payments company Stripe has announced plans to reduce its workforce by nearly 14% to cut costs amid challenging economic conditions.

Following the cuts, the company will employ around 7,000 people, according to an email sent to employees by Stripe CEO Patrick Collison.

In the email, Collison highlighted a number of issues, including inflation, energy shocks, spike in interest rates, lesser investment budgets and inadequate startup funding, faced by the firm.   

Collison also acknowledged that the company’s management took a few missteps in the last two and half years.

He said: “In our view, we made two very consequential mistakes, and we want to highlight them here since they’re important:

“We were much too optimistic about the internet economy’s near-term growth in 2022 and 2023 and underestimated both the likelihood and impact of a broader slowdown.

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“We grew operating costs too quickly. Buoyed by the success we’re seeing in some of our new product areas, we allowed coordination costs to grow and operational inefficiencies to seep in.”

According to Collison, Stripe ‘overhired’ and was not able to deliver its expected outcomes.

However, the firm saw an increase in growth between 2020 and 2021 after the world started turning towards e-commerce when the Covid 19 pandemic hit around two years back.

The latest move comes shortly after a recent TechCrunch report that stated that Stripe axed some jobs at tax compliance startup TaxJar, which it bought last year.