Sapiens layoffs: “Anyone not asked to prepare layoff lists knew they were on it”
Employees describe shock, demotions, and a rapid overhaul following Advent’s $2.5 billion takeover.
“Sapiens was a very family-friendly and pleasant company for many years. CEO Roni Al-Dor was a people person. Employees went through fire and water with him, which is why everyone is so surprised now, and deeply hurt,” says one employee. “He and the CFO left, the entire Israeli management was replaced, and even managers who remained were effectively demoted and stripped of authority. Everyone now reports to managers brought in by the fund.
“Already when we lit the Hanukkah candles, they hinted that the company was entering a challenging period, but we didn’t realize how radical the streamlining would be. Anyone who wasn’t asked to prepare a list of employees to be laid off understood that they themselves were probably on the list. If employees had at least been compensated properly upon exit, it might have softened the blow. But after Al-Dor and the senior executives left, it became clear that they had taken all the bonuses from the deal for themselves, while employees, even at relatively senior management levels, were left with nothing.”
This account, shared by Sapiens employees, captures the mood at the company in recent months, and even more so over the past two days since Calcalist revealed the dramatic shake-up now facing its workforce.
Formula Systems, controlled by CEO Guy Bernstein and the controlling shareholder of Sapiens, signed a high-profile exit in August, selling the company to U.S. private equity fund Advent for $2.5 billion in cash. The deal closed less than two weeks ago, yet its consequences are already being felt. Sapiens’ 5,400 employees worldwide, about 800 of them in Israel, are now discovering the darker side of a glamorous exit.
The case of Sapiens is particularly stark because it is fundamentally a “low-tech” company. The 60% control premium paid by Advent, and the sheer size of the deal, briefly created the impression that employees were part of a high-tech success story. In reality, the company is now preparing for workforce reductions of at least 15%, or roughly 800 employees.
Management has been fully replaced by representatives of the Advent fund, and the company’s headquarters, long based in Israel, has already been moved to London, where key decisions are now made. Since announcing the acquisition in August 2025, Advent has worked with a consulting firm on a 100-day transformation plan. Immediately upon closing the deal, with no grace period, implementation began.
Sources familiar with the transaction say Bernstein, who led negotiations with Advent, succeeded in maximizing shareholder returns and securing the unusually high 60% premium. That premium is now creating intense pressure on Advent to deliver returns. The deal was executed by the fund’s European arm and led by a relatively young partner with limited major exits to date, further amplifying that pressure.
Employees describe Sapiens as a “classic, old-style tech company”: a relatively relaxed pace of work, far removed from the intensity of Tel Aviv’s startup ecosystem. The trade-off was modest compensation, especially in equity. That reality is now fully sinking in.
In younger tech companies, it is common for employees to collectively hold 10%-15% of fully diluted equity through options and, later, restricted stock units (RSUs). At monday.com, for example, employees hold roughly 10% on a fully diluted basis. At older firms such as Nice, the figure is around 5%. At Sapiens, employee options and shares accounted for less than 3% of the company.
Moreover, ordinary employees at Sapiens received no options at all, nor did most middle managers. Even relatively senior executives were largely excluded. Employees now understand that Bernstein, Al-Dor, CFO Roni Giladi, and a small circle of top executives captured most of the equity upside.
Public filings from Sapiens’ time as a listed company show that Bernstein and Al-Dor were the primary beneficiaries of the deal. On the eve of the sale, Al-Dor held 420,000 shares and 480,000 options, most of which vested upon the acquisition and constituted the majority of options issued by the company. In total, the exit generated approximately $38 million for Al-Dor. Bernstein, already a billionaire through his holdings in Formula, further benefited from the transaction; since the sale was announced in August, Formula’s share price has risen by about 30%.
At the same time, Sapiens is widely viewed as overstaffed, employing 5,400 people on annual revenue of roughly $500 million. By comparison, Check Point, with more than $2.5 billion in annual revenue, employs about 7,000 people.
Advent’s strategy is to narrow Sapiens’ product portfolio, even at the cost of reduced revenue, and focus on products with stronger growth and profitability profiles. Some product lines will be shut down, and others may later be sold. The layoffs are not expected to disproportionately affect Israel, where development of two core product lines is concentrated: IDIT, insurance core software, and IPELS, which focuses on life insurance and pension management.
Even if fewer employees are ultimately laid off in Israel, the broader reality remains unchanged: a company that operated independently for four decades is being transformed into yet another development center for a global private equity fund.
