CXA Group to shut down Vietnam tech hub, lay off dozens

With additional reporting by Melissa Goh and Thu Huong Le

Singapore-based insurtech startup CXA Group will be shuttering its tech hub in Ho Chi Minh City, Vietnam, by April 16, according to three current and ex-staff with direct knowledge of the matter.

The sources added that Rosaline Chow Koo, founder and CEO of CXA Group, made the announcement during a town hall meeting last Thursday.

All 70 employees from the Vietnam hub will be laid off, according to the sources, adding to the terminations that affected some tech workers in CXA’s Singapore office last month.

The company had a headcount of around 329 before the downsizing, Koo tells Tech in Asia, though this number includes the 120 or so people that were part of its brokerage arm that was sold to employee benefits broker Pacific Prime.

Rosaline Chow Koo, founder and CEO of CXA / Photo credit: Tech in Asia.

Following the Vietnam shutdown, the company would be left with 120 employees, with just six in Singapore, Koo says.

“Without the brokerage, our business becomes extremely lean, as the entire tech platform is completely built out. So now we focus entirely on sales and deployment,” she notes.

Chief technology officer Thorsten Maus told Tech in Asia that he has left CXA; his Linkedin profile shows that he departed in February. Maus was hired in 2019 to help set up the tech hub, which was supposed to take over the development of CXA’s platform – a task that was originally outsourced.

CXA previously said that its revenue grew 40% in 2020, with major contributions from its software-as-a-service (SaaS) business.

The company confirmed the closure of its Vietnam hub with Tech in Asia. “CXA is consolidating all of our product and technology teams into China, where we already have a large local business and existing tech team. So we are adding more regional tech capabilities into China to support our SaaS growth globally,” explains Koo.

However, CXA says it has not laid off any Singapore staff since it sold its insurance brokerage to Pacific Prime.

The company denies that financial difficulties brought on the job cuts. Meanwhile, a copy of an official termination letter seen by Tech in Asia attributes the shutdown to Covid-19.

A surprising move to some

Tech personnel from the Vietnam office have been asked to hand over their work to the staff in CXA’s China office, where the company has around 30 tech employees, according to another source.