Clubhouse lays off half of all employees

The golden days of the Clubhouse app are long gone. While the social network blossomed into a hype app during the corona pandemic, half the workforce now has to go.

At the beginning of 2021, everyone was talking about Clubhouse. The app, which was completely unknown at the beginning, blossomed into an absolute hype platform within just a few months.

The audio network already reached more than nine million in February App downloads worldwide. But the hype didn’t last long.

Because with the ever-reducing restrictions of the ebbing corona pandemic, conversations increasingly migrated back into real life. These changes have also left their mark on the Clubhouse company. Because now the network has to lay off half of its workforce.

Clubhouse needs to split in half

In an email the two founders Paul Davison and Rohan Seth addressed their employees. In it, they announce that they will “downsize their organization by over 50%.” Those affected would receive an invitation to a 1:1 conversation after this message, it said.

The main reason for this enormous wave of layoffs is the “reorientation” of Clubhouse. The creators see the platform as a place “where you can meet friends, get to know their friends and talk”.

Of course, that worked well during the restrictions imposed by Corona. But those times are apparently over.

As the post-Covid world opened up, it has become more difficult for many people to find their friends on Clubhouse and fit long conversations into their everyday lives.

Now the platform has to develop further and thus “find its role in the world”. That requires a phase of change.

problems with coordination

As Davidson and Seth write, this restructuring could not be accomplished effectively with the current size of the team. The spatial separation of the teams was also problematic.

It is currently difficult for many teams to coordinate. The employees felt “blocked” by the executive floor. The solution should be a “smaller, product-oriented team”.

We’ve only reluctantly come to this conclusion as we still have a few years to go and don’t feel any immediate pressure to reduce costs.

A smaller team allows the company “more concentration and speed”. Davidson and Seth hope that this will be “the next development stage of the product”.

This is how Clubhouse wants to support those affected

In their letter to the workforce, the two founders list a long series of measures that should now support dismissed employees.

The company will pay those affected their salaries by the end of April. In addition, a four-month severance payment is intended to ensure that those laid off receive their full salary by the end of August. Clubhouse will also cover health insurance costs until the end of August.

In order for those affected to be able to apply for new jobs, they will be able to keep their laptops provided by the company. The company also wants to support those with job searches and people with visas with immigration.

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