Zocdoc Said to Cut 5% of Workforce as New CEO Refines Focus

  • Doctor appointment booker said to shrink local sales teams
  • Technology startups pare jobs as they change direction

Doctor-appointment booking startup Zocdoc Inc. is cutting about 5 percent of its workforce as the company’s new chief executive officer shifts its focus toward large health-care organizations, according to a person familiar with the matter.

The company is cutting 33 jobs in its New York and Phoenix offices, said the person, who asked not to be identified because the matter is private. The majority of the reductions are in the local sales group, which is dedicated to smaller independent practices, while some positions in recruiting, office operations and information technology will also be eliminated, the person said.

Four months ago, co-founder Oliver Kharraz took the helm as CEO of the New York-based startup, with the promise of building deeper corporate partnerships with health systems. The headcount reductions are part of an effort to refine the company’s focus on the health systems business, which has doubled in size in the past year, the person said.

“We have parted ways with talented individuals for whom we have great respect and appreciation,” the company said in a statement. “We are updating our staffing to match the strategic direction of our business and the evolution of the health-care industry since our start nearly a decade ago.”

Founded in 2007, Zocdoc provides medical professionals with an online scheduling tool for patients to book appointments. After the cuts, the company will have about 600 people across three offices. Zocdoc has raised $230 million and was last valued at $1.8 billion, according to the company.

U.S. doctors are increasingly working for hospitals instead of private practices. Only a third of physicians are projected to be independent by the end of this year, compared with 57 percent in 2000, according to a July 2015 report by Accenture Plc.

A slew of firings have hit technology startups since September, with more than 1,000 positions eliminated, according to data compiled by Bloomberg from company disclosures and news reports. The reasons vary. Some companies, such as Zocdoc, are making business-plan adjustments. Snapchat Inc. is abandoning plans for original content and eliminating staff, and messaging app developer Tango eliminated 9 percent of its workforce after a failed move into e-commerce.

Others are making deeper personnel cuts to pare expenses. Jawbone Inc., the maker of wearable fitness trackers, cut 15 percent of its workforce, or 60 employees, late last year to reduce costs.

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