CareRev Plans to Cut Roughly a Third of Staff

CareRev, a healthcare startup that raised around $100 million from investors during the pandemic, is in the process of laying off nearly 100 employees—or about a third of its corporate workforce—according to one person with direct knowledge of the plans and another who was briefed on them.

The cuts follow the departure of CareRev co-founder Will Patterson, who resigned as CEO earlier this month after The Information made inquiries about his conduct. In early June, The Information published an investigation in which current and former employees accused Patterson of admitting to microdosing LSD while pitching investors for the company’s Series A fundraising round, openly discussing his drug use in front of employees and urging them to try LSD and cannabis.

The Takeaway

CareRev, which offers a gig work platform nurses and other healthcare workers, is in the process of cutting roughly 100 employees, or about a third of its staff.

Sometimes described as an “Uber for nurses,” CareRev is a gig-work platform that helps hospitals address staffing issues by allowing a network of vetted healthcare workers to pick up one-off shifts. The Information also reported that former employees said that CareRev, under Patterson’s leadership, allowed healthcare workers with criminal records to obtain shifts through its platform, in violation of state laws.

The company previously said it couldn't confirm or deny the specific allegations concerning its vetting process, but noted that it “meets industry best practices.” Patterson, through his attorney, denied that he advised CareRev to violate any law.

A company spokesperson didn't respond to multiple requests for comment. More than a dozen CareRev employees published posts within the past day saying that they had been laid off.

In a company meeting hours after the announcement of Patterson’s resignation, his replacement as CEO, Brandon Atkinson, told employees The Information’s reporting had hastened Patterson’s departure, according to a person familiar with his comments.

During that meeting, Atkinson said Patterson’s resignation put the company in a “difficult place” and told employees he was considering layoffs to reduce the startup’s cash burn “so that we have a long enough runway to achieve our goals,” according to a video recording of the meeting viewed by The Information.

Earlier this week, Atkinson announced during a company meeting that the cuts were in progress, according to the two people familiar with his comments. By the end of the week, the company expects to notify around 100 of CareRev’s 300 corporate employees of their layoffs, those people said. A slowdown in CareRev’s business and the recent loss of one of its biggest clients in part motivated the cuts, they said.

Earlier this year, SSM Health—a health system whose contract with CareRev generated around a third of the startup’s net revenue in 2022—announced plans to stop working with CareRev and signed a contract with a competitor, The Information reported.

Paris Martineau (@parismartineau) is a feature writer and investigative reporter for The Information's Weekend section. Have a tip? Using a non-work device, contact her via Signal at +1 (267) 797-8655.