a16z-backed Loom lays off 14% of staff, a year after becoming a unicorn

a16z-backed Loom lays off 14% of staff, a year after becoming a unicorn

Loom, an enterprise collaboration video messaging service, has laid off 34 employees, or 14% of its total staff, the sources say. Product and people operations employees were affected. The venture capital-backed company confirmed the firing and the number of people affected, providing the following statement from founder and CEO Joe Thomas:

We had to make the extremely difficult decision to go ahead with a downsizing of our entire team. Each person affected was not only a talented employee, but also a valuable person and teammate. We are committed to supporting these employees through this transition, both in offering severance pay and career support. We are confident in the road ahead of Loom. Ultimately, this decision was made to ensure that we can move forward in a sustainable manner, especially in light of increased economic uncertainty, and continue to deliver on our vision for years to come.

The company was founded by Thomas and Vinay Hiremath in 2015, reaching 1.8 million users across 50,000 companies just three years later. According to its website, Loom currently has 14 million users across 200,000 companies, including Netflix, Atlassian, HubSpot, and Juniper Networks. Like Hopin, Loom has benefited from a surge of people working from home in response to the COVID-19 pandemic; the product was positioned to help remote workers find better ways to connect with colleagues in a virtual-first world, and help hybrid workforces find a lightweight way to skip some meetings. Then, again similar to Hopin, the startup made layoffs to help it build what it describes as a more sustainable way forward. That growth has attracted $203 million in known venture capital funding, with the company recently announcing a Series C led by Andreessen Horowitz. The same round valued the company at $1.53 billion, achieving unicorn status for the first time. Kleiner Perkins, Sequoia, Coatue and General Catalyst are also investors in the company. It’s been over a year since the startup secured the new funding and valuation, and according to today’s news, Loom is joining the club of unicorns who have had to downsize the workforce after reaching the coveted milestone. Less than a year ago, visual creator tool startup Picsart raised $130 million from SoftBank, earning a valuation of more than $1 billion. The company laid off 8% of its workforce last month, affecting 90 people. Cameo, who also became a unicorn last year, also recently made layoffs that impacted 87 people.


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