The creator subscription company Patreon is the latest company to be affected by a long line of tech layoffs.
CEO Jack Conte wrote in a letter to staff — cross-posted to Patreon’s blog — that 17% of the staff will be laid off. This affects the Go-to-Market, Operations, Finance and People teams. Patreon will also close its Berlin office, which worked on sales and marketing. The Dublin office will close as well, since Patreon wants to consolidate its engineering efforts in the U.S. — the nine engineers working in Dublin will be offered relocation packages. All affected employees will be offered at least three months of severance pay, plus COBRA health benefits for U.S. employees for the rest of the year.
Just last week, Patreon also let go of five members of its security team. Conte wrote that those layoffs “stemmed from a different set of reasons” from the layoffs today.
“The change last week was part of a longer-term strategy to continue distributing security responsibilities across our entire engineering team, bring new areas of expertise into Patreon internally, and continue partnering with external experts,” Conte wrote. “Unfortunately, the change generated concern that we were reducing our security investment, but I wanted to make it clear, especially in light of today’s changes, that we are in fact increasing our investment in security.”
Last year, Patreon raised a $155 million round of venture funding, bringing the company’s valuation to $4 billion. When TechCrunch spoke to Patreon chief product officer Julian Gutman in December, he said that the company planned to double in size by the end of 2022 — but evidently, those plans have shifted in the months since.
Patreon makes its money from taking a cut of the subscriptions that fans pay creators each month, so layoffs at Patreon could be a concern for creators who rely on the platform for sustainable monthly income.
In addition to his letter to staff, Conte also wrote on his personal Instagram about the layoffs.
“I remember how nerve-racking it was when I was a full time creator — before starting Patreon — to watch companies that I depended on go through moments like this,” Conte wrote. He said that the reason Patreon is making these job cuts is to make sure that Patreon continues to be a reliable monetization tool for creators.
It could be a bad sign, though, that creator economy companies are not immune to this ongoing tidal wave of tech industry layoffs. Layoffs have also affected Lightricks, StreamElements and Jellysmack. Plus, social companies like Snap and ByteDance, TikTok’s parent company, have also conducted job cuts this summer.
When TechCrunch spoke to Conte in August, we asked the creator-turned-CEO about what he thinks the macroeconomic downturn means for creators. He said it was too early to tell, but he wasn’t worried about creators in the long run.
“If we have an extended recession here, I think we’ll have to see what the impact of softening consumer spend is on creators,” Conte told TechCrunch. “But over the long run, I think the impact is minimal. Look at what people value most. […] It’s in the work and expression of creative people.”
Source @TechCrunch
