Yotpo lays off 200 as AI hits headcount

AI is shaking up Israeli tech company Yotpo, which was founded by entrepreneurs Tomer Tagrin and Omri Cohen. The company is laying off 200 employees, including 80 in Israel, due to the company’s move to implement more AI-based technologies in its user reviews product for e-commerce sites. Yotpo will sell divisions that were founded before the ChatGPT era, including customer loyalty management products in the email and messaging sectors, and will relinquish customer club activity and its main product – managing user reviews.

Yotpo raises $230m at $1.4b valuation

This is about a third of the company’s workforce, which is located in offices in New York, various European countries and Hamasger Street in Tel Aviv. Yotpo’s main product deals with managing customer reviews.

But by implementing AI, the company plans to allow e-commerce sites to quickly summarize the total number of reviews from all customers for each product and present it briefly to the user, and in the field of customer club management, Yotpo will allow the creation of personalized recommendations for consumers. After a small acquisition of an AI team (the company Ko.AI), Yotpo is implementing large language models and integrating them with AI tools as part of a product that they provide to retail sites.

The company generates annual revenue of $150 million, but is not profitable. Previous reports suggested the company was on the verge of an IPO, but the market turmoil due to the introduction of AI is preventing a flotation.

Yotpo CEO Tomer Tagrin said, “The move is designed to sell the products to one of the largest companies in the email and retail brand email market, as well as to implement AI at all levels of the enterprise. We believe that every company that was founded before the AI era must fundamentally change the way it is built to become an AI native company, meaning that AI is naturally integrated into it. Unfortunately, in such a process, we are saying goodbye to many employees who were a significant part of what we built, and I want to thank them for everything.”

Published by Globes, Israel business news – en.globes.co.il – on August 5, 2025.

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