CRIMINAL CAPITALI$M
Britain's scandal-hit tech champion to lay off 30pc of staff

Gareth Corfield
Thu, 4 May 2023

The Wandisco logo is seen on an LED screen in the background while a silhouetted person uses a smartphone - Alamy Stock Photo

Wandisco is to lay off a third of its staff as the Financial Conduct Authority (FCA) continues an investigation into alleged fraud at the British tech champion.

The company announced on Thursday that 30pc of employees will leave as part of a fresh cost-cutting drive.

Ken Lever, the former Biffa boss who is now Wandisco’s executive chairman, said: “Regrettably, the proposed action is a necessary step to responsibly position Wandisco for long term growth.”


The data replication company suspended its shares from trading on the Aim junior market in March after revealing a suspected $15m (£12.6m) accounting fraud.

An internal investigation found that $15m of revenues and $115m of sales the firm had reported were completely invented. Wandisco blamed the “potentially fraudulent irregularities” on “one senior sales employee”.

Forensic accountants from FRP Advisory are now combing through the Sheffield-based firm’s books, while the FCA opened an investigation into Wandisco in April.

Immediately before the share suspension Wandisco founder and chief executive David Richards suggested he was pursuing a dual UK-US listing for the £880m company.

Megabuyte analyst Tom Kennedy speculated in a client note that the headcount cuts could give the company a lifeline “until early 2024”, highlighting “its long history of very heavy cash burn.”.

“As we've previously noted, there are few, if any, capital raising routes left for Wandisco,” he added. “Shares are still suspended and investors will feel burned anyway.”

The company had $19m (£15.1m) in the bank at the end of last year. It introduced a four-day working week in February 2022.

Analyst firm Edison withdrew its coverage of Wandisco when the suspected fraud was first revealed, saying at the time: “Due to the nature of the ongoing investigations, we have not been able to speak to the company since the announcement.”

Prior to uncovering the accounting irregularities, Wandisco was a fast-growing software company worth almost £1bn.

Its business consists of helping companies move very large quantities of business data into the cloud, a process that is usually risky.

In January, the company said revenues had grown 230pc to $24m in 2022. On Thursday it warned that the true figure could be as low as $9m.

Mr Richards, who stepped down in April along with finance chief Erik Miller, declined to comment.

Separately, the finance chief of the most valuable semiconductor company listed on the London Stock Exchange will step down just days after it was forced to delay issuing its final accounts.

Shares in Alphawave IP, which designs tiny parts of microchips, plunged 20pc last week after the Anglo-Canadian company said its auditors KPMG would not be able to provide a final opinion on its accounts in time.

The company has suspended trading of its shares until its delayed accounts are published on or before May 12. The company said the delay was due to added complexities after it undertook a series of mergers.

Daniel Aharoni, the company's chief financial officer, will leave the company after the final results are revealed.

Christian Bowsher, senior director of finance at Alphawave, will serve as acting finance chief until a successor is found.

John Lofton Holt, Alphawave's executive chairman, said: “Daniel has been a key part of our journey since our IPO in 2021 and during the three transformational acquisitions we undertook in 2022.”