TechCrunch has learned that Lockerz, the social commerce and photo sharing service, is downsizing. It has shut down its San Diego office, laying off all but two of the staff who will now work remotely. The company has also laid off “around 30%” of its head office in Seattle, with its chief product officer Michael Walton among those going. A source tells us that the other people laid off in Seattle include those working in merchandizing and marketing.
To date, Lockerz has raised some $43.5 million, with backers including Kleiner Perkins Caufield & Byers, DAG Ventures, Live Nation and Liberty Media. Most recently that included a $7.5 million round in October 2012, revealed not long after the founder of the company, Kathy Savitt, left her position as CEO and became CMO of Yahoo. She was replaced by Mark Stabingas, who remains CEO. Savitt is now Lockerz’s chairwoman.
We have reached out to Lockerz for an official comment and will update this story as we learn more. Update: We now have a response from Lockerz’s chief marketing officer, Leilani Augustine confirming the layoffs:
“Today we went through the process of realigning our organizational structure to best fit the needs of our product and business as we move forward. That means that some positions were eliminated and we will be increasing our investment in other areas we see as opportunity. I will not comment on how many individuals were effected or any specific individual… We remain bullish on the opportunities surrounding social commerce. We believe we are in the early stages of a transformational change in the way consumers discover and consume products and content. Our vision remains the same and and today’s changes will allow us to be much more nimble, which is an important component of success in this space.”
The reason for the change is not completely clear, but with the teams relatively small — San Diego had around 10 people working there, and Seattle around 40, TechCrunch understands — it may have been partly the case that the company decided it was better to consolidate them into one place and operate in a leaner way.
The San Diego office became part of Lockerz when it acquired Plixi in January 2011, for a price believed to be between $10 million and $15 million. That deal gave a big traffic boost to Lockerz at the time — reportedly boosting the site from 1 million uniques per month to up to 40 million.
But as Twitter has moved further into its own photo service, and many other players have also moved into the game, that traffic has “died,” in the words of one source.
So Lockerz has increasingly been transforming its business into one based on social commerce, where people share things they want to buy, collect points for posting and sharing, and buy via the site with discounts based on those points. The site was “Pinterest-ified” in February 2012 with an infinite scroll of images arranged in a grid pattern linking through to social actions and more content. Today, traffic is in the range of 15-20 million uniques per month, TechCrunch understands, and is growing at a fast clip, but it’s not clear how well these two sides of the business merge together — with one decidedly social and non-commercial and the other social but very commercial.
We have heard that among those that are staying on in San Diego is Daniel Marashlian, who had been CTO of Plixi and is now Lockerz’ head of mobile. We are still waiting for confirmation on this; for now, his LinkedIn profile remains tied to Lockerz.