Nu Holdings slashes management layers, CEO says

Nu Holdings (NYSE:NU), a digital bank that operates under the NuBank name, cut its number of management layers by half as it seeks to increase efficiency and stay nimble, its CEO said in a media interview on Thursday.

The company had grown “too verticalized,” expanding to as many as 14 layers, CEO and co-founder David Velez said in an interview with Bloomberg News.

The streamlining came as several top executives left the firm, including Jag Duggal and Youssef Lahrech.

“There were four layers between me and the senior managers of the products, and like 14 layers across the organization, which is too much for an organization that needs to be agile, make decisions quickly, and has so much growth ahead,” he said.

Nu (NYSE:NU) has reduced the layers by half and “significantly” increased the speed at which it moves, he added. The company has more than 118M clients in Brazil, Mexico, and Colombia, and plans to expand internationally. To help with that initiative, it will hire new c-suite executives.

Just this week, Lahrech stepped down as president and chief operating officer. His departure follows those of Duggal, who was the chief product officer, investor relations head Jorg Friedemann, and Chief Legal Officer Elita Ariaz. While Velez understands that the exits look scary to investors, the company is “bringing in a new set of executives for the new phase.”

There haven’t been any layoffs, and there are no plans for any, Velez said. The revamping is focused on execution and efficiency rather than cost-cutting.

Nu Holdings (NU) stock rose 2.8% in Thursday afternoon trading.