Clear Capital Downsizes After Exiting ‘Unprofitable Line Of Business’

Written by Patrick Barnard
on February 25, 2014 No Comments
Categories : Blog View

BLOG VIEW: I got an email from a reader on Monday who said he had caught wind of a ‘mass layoff’ at Truckee, Calif.-based valuation solutions provider Clear Capital. The layoff was announced internally at the company on Feb. 20, the reader said.

An email message was sent to all employees stating the company was ‘right-sizing’ and they would receive an email or call from HR informing them of the situation, the reader said, adding that the layoffs affected up to one-third of the company's workforce – or about 100 employees.

The reader further stated that employees were being offered severance packages and had to sign documentation that the layoff would not be leaked to any media/social outlets.

I contacted Clear Capital – which, by the way, does some interesting analytical work in the valuations space – on Tuesday, and according to a company official, less than 10% of the company's workforce was laid off – due mainly to the voluntary discontinuation of one of its legacy desktop valuation review products. (Clear Capital has several other desktop review products – its Collateral Desktop Analysis and Reconciliation Tools are not affected.)

‘Clear Capital voluntarily exited an unprofitable line of business and as a result, reduced our staff by less than 10% last week,’ Kevin Marshall, president of Clear Capital, said in a statement, which was emailed to me almost immediately. ‘This decision was made to better align our product and service focus on forward-looking industry needs, and allow us to restructure our staffing model to the ordering needs of our clients. We continue to be financially healthy and well poised for the next phase of the U.S. housing cycles.

‘In addition, Clear Capital has expanded both our outside and inside sales forces with long-time industry experts and experienced existing staff,’ the statement continued. ‘The pace of on-boarding new clients has significantly increased in Q4 2013 and YTD in 2014. Other anticipated Q2 initiatives include the roll-out of sizable contracts with several of the largest mortgage financial institutions, rapid expansion of our proprietary data sets fueling a new generation of products, and widespread industry adoption of human and analytic-based quality control tools and systems engineered for the post-QM era. Each of these are expected to have a transformative impact on the industry, allowing Clear Capital and our partners to grow in a healthy, sustainable manner.’

Clear Capital announced just last week that it had hired Rich Kuegler and Scott Bares to serve as the company's directors of customer development.

Both will work with all segments of the lending industry, crafting innovative and compliant solutions within a more regulated and scrutinized environment, the company said in a press release.

Kuegler has held executive-level positions in mortgage finance since 1996, most recently as senior vice president at DataQuick.Â

"Rich's experience and success in strategic planning, product development and business development make him vital to Clear Capital's growth," Marshall said in the release.

Bares brings 17 years of experience to the company, having previously held management positions at GMAC, Wells Fargo, Winmark and most recently Lender Processing Services.

‘Scott does not believe in a one-size-fits-all solution. His ability to empathize with our customers will ensure he brings the right solution to the table, every time,’ added Marshall.

Not sure, but this doesn't really sound like a company that's falling into the red, does it?

– Patrick Barnard, editor, MortgageOrb

(Do you have an opinion to share with MortgageOrb? Get in touch! Send an email to pbarnard@zackin.com.)

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