Creator finance startup Karat has laid off staffers after raising $70 million earlier this year

• Creator finance startup Karat Financial laid off staffers this month, four people familiar with the matter said.
• The cuts came a few months after the company raised $70 million in new funding.
• Karat declined to comment.

Karat Financial, the creator finance startup, laid off employees this month, according to four people familiar with the matter.

Three of these individuals, who included current and former employees, estimated that 10% or more of the company was cut, but they did not have a specific figure from management. Karat did not respond to questions about the layoffs.

Eric Wei and Will Kim founded the startup in 2019, which offers financial services such as taxes and bookkeeping to creators.

Karat raised a $70 million Series B round this year, after announcing a $40 million equity round and $30 million in debt financing led by TriplePoint Capital in July.

The startup has been a darling of the creator-economy scene, raising capital from notable creators such as Nas Daily and Josh Richards, as well as big tech executives such as Twitch cofounder Kevin Lin.

Karat’s cofounders are angel investors, and the “Karat House,” a Los Angeles mansion, has become a hotspot for industry events ranging from a Discord creator community event to a recent book party for tech journalist Taylor Lorenz.

Karat is the latest in a wave of layoffs that has swept the creator economy, affecting everyone from startups like Grin and Cameo to the most prominent social-media companies like Meta and Snap. Though Goldman Sachs valued the creator economy at $250 billion earlier this year, its growth has slowed in tandem with broader market uncertainty.

Despite the layoffs, Karat appears to be hiring for several open positions on its website.