February 23, 2024

Clubhouse, the once-popular social audio app created by Paul Davison and Rohan Seth, has laid off more than half its staff. The startup’s co-founders made the decision in response to changing customer habits and the complexities of working remotely in a post-COVID world, According to the blog post.

Those affected will receive severance pay and continued health coverage for the next several months. A spokesperson for Clubhouse declined to comment on the number of people affected by today’s layoffs or the number of employees remaining at the company. Last October, Davidson told TechCrunch that Clubhouse had nearly 100 employees.

The layoffs come less than a year since the company last laid off some staff as part of another restructuring. The company later told TechCrunch that “some people decided to pursue new opportunities, and as part of streamlining our team, some roles were eliminated. We will continue to hire for engineering, product, and design roles.”

The social app, which has more than $100 million in venture capital backing and was once valued at $4 billion by investors including Andreessen Horowitz, Tiger Global and Elad Gil, is taking a different tone amid today’s mass layoffs.

“As the world opens up post-Covid, it’s getting harder and harder for many people to find their friends on Clubhouse and integrate long conversations into their daily lives. To find its role in the world, the product needs evolution,” the co-founders wrote in a blog post. They went on to write that the company had attempted to change its current team size but was unable to do so due to the size of the team. “It was difficult for us to communicate strategy to cross-functional teams when we were moving at 1% a day, or to make rapid changes when each interface was owned by a different product team. especially challenging.”

Unlike many entrepreneurs, the co-founders made no mention of the economy when announcing the layoffs. Instead, Clubhouse appears to be dealing with the complexities created by overhiring and the remote work environment, both internally to run a business and externally to build something people want.

“Our belief is that as the world opens up, something is going to happen: people are going to need a place more desperately where you can go and be with your friends, meet their friends and have a good conversation. I also think Audio products are designed to be hands-free, designed to allow you to multitask…I think the trends we’re building are permanent,” Davidson shared on stage at TC Disrupt last year, offering an insight into his The product’s windows revolve around social audio and the philosophy of remote work.

On stage, he also responded to the ongoing criticism and scrutiny surrounding Clubhouse’s collapse due to hype. “The nice thing about having done something like this a few times before is that you tend not to get caught up in your own hype. When things are in full swing, you say this is going to go down, and when things get tough, you say we will solve this problem.”

Going forward, Clubhouse’s small team will focus on building “Clubhouse 2.0”.

“As remote living, empty scrolling, and Zoom meetings become more commonplace, this is more true than ever. We have a clear vision of what Clubhouse 2.0 will look like, and we believe that through a smaller, leaner Team, we’ll be able to iterate details faster, build the right product, and honor our teammates who helped us make it happen,” said today’s blog post. TechCrunch contacted some Clubhouse investors, and many said they don’t know what the rest of the team is doing. Last year, Davidson referred to the shift of club activities from “live podcasts” and radio acts to private rooms, intimidating internal conversations.

The company still has time to provide further answers. Clubhouse did confirm that it has “many years of runway left,” and with today’s layoffs, there’s now even more. A spokeswoman said the company has no hiring freeze at this time.

Those who know the Clubhouse can contact Natasha Mascarenhas on Twitter @nmasc_ or via signal +1 925 271 0912. Anonymous requests will be honored.