Clubhouse, the social media platform that gained popularity during the COVID-19 pandemic for its live audio chats, has announced that it is laying off more than 50% of its staff as part of a company “reset.” The announcement came via a letter to staff shared by Clubhouse’s founders, Paul Davison and Rohan Seth, who stated that they are “saying goodbye to many talented, dedicated teammates” in order to take the company down to a smaller, product-focused team.
Despite the layoffs, the founders reassured staff that the company was still well-funded, with “years of runway remaining,” and that they did not feel immediate pressure to reduce costs. Clubhouse was valued at $4 billion in 2021, according to reports.
Clubhouse became a popular platform earlier this year, with high-profile figures such as Elon Musk and Oprah Winfrey participating in live audio chats. However, usage dropped off as the pandemic eased and competitors cloned the service. Davison has previously admitted that the company’s growth came “way too fast.”
In the letter to staff, the founders alluded to the issues facing the company, stating that “as the world has opened up post-Covid, it’s become harder for many people to find their friends on Clubhouse and to fit long conversations into their daily lives.” They added that in order to find its role in the world, the product needs to evolve.
Davison and Seth also announced that they will be focusing on “Clubhouse 2.0” but did not elaborate on what the new version of the service may look like. The announcement follows the shutdown of other live audio services, including Spotify’s Greenroom and Reddit Talk. Even tech giants Amazon and Meta have struggled to keep some of their audio projects going.
