In 2020, the American audio-based social networking app Clubhouse experienced a significant surge in popularity. The app was used by numerous content creators. The company, founded in the same year, faced criticism over data privacy concerns. Now, Clubhouse is announcing multiple layoffs, with over 50% of its employees being forced to leave.
Co-founders Paul Davison and Rohan Seth have informed their employees that more than half of the jobs at Clubhouse will be cut, although the exact number remains unclear. According to the company's statements, the goal is to make the work more efficient with a "lean, product-focused team." Therefore, financial reasons seemingly do not play a role in the decision.
Specific measures are said to be taken for the affected employees, and they will receive further information through one-on-one conversations with their department managers. In addition to a severance package consisting of their April salary and four additional monthly salaries until the end of August 2023, Clubhouse will also maintain medical insurance for the laid-off employees.
They are allowed to keep their work laptops to facilitate their job search. Clubhouse also promises support to those employees who are on a visa with Clubhouse and need to consider further implications for their residency status after the termination.
As for the next steps, the company aims to continue its work with a more streamlined team and advance the plans for Clubhouse 2.0. The company might replicate its market entry strategy. The Android version of Clubhouse was in a closed beta testing phase in the United States since early May 2021. Starting from May 18, the Android app was released in Japan, Brazil, and Russia. Nigeria and India were added on May 21. Clubhouse was initially launched as an iPhone app in 2020 and has since attracted a lot of attention. Multiple people can use the voice communication service to engage in public audio chats. During the pandemic, prominent figures from the entertainment and political industry embraced the platform. However, interest in Clubhouse declined after the pandemic.
At the same time, the concept of the app inspired nearly the entire tech industry to develop their own competing products.
Reddit, Discord, Telegram, LinkedIn, and even Spotify are actively working on competing offerings. However, the most advanced alternative to Clubhouse is Twitter's Spaces.
Currently, Spaces is only available to users with at least 600 followers on Twitter, but soon there will be an option to charge for entry into private conversations. So far, Clubhouse only offered the option to voluntarily donate money to a user.
According to the email, significant changes in people's daily lives during the post-COVID period have forced the company to reboot Clubhouse. Ultimately, it has become increasingly difficult for users to integrate long conversations on Clubhouse into their everyday lives - during times of isolation, this was easily feasible and initially made the Clubhouse project successful. The exact details of what the company's new adapted product will look like remain unclear.