Stealthy payments startup Clinkle which raised $25 million in outside funding before its product ever launched, has terminated around 25% of its staff (16 people), according to a report posted this morning by Fortune. The news of the layoffs comes amid speculation that there’s internal trouble, and even potentially issues with Clinkle leadership, which has raised doubts about the company’s future.
The news of the layoffs comes shortly after the unearthing of a scathing review of Clinkle operations and its founder, 22 year-old Lucas Duplan, which was left on Q&A site Quora in late November. Reportedly authored by two former employees, the post lists 31 ex-employees at the startup, though it didn’t clarify who among that list was terminated, versus those who quit or who may have been working part-time or had to return to school – or so points out Business Insider, which found the Quora post originally.
Similar anonymously-posted lists of ex-staff have also showed up on web before, like this list on Pastebin.
The anonymous Quora posters allege that they put in long workweeks, having been promised equity, but never received it. That post had to be taken with the proverbial grain of salt at the time, however, as it seemingly came from someone(s) with an axe to grind. However, combined with this new report, doubts about Clinkle grow.
The company has had a hard time keeping news of its goings-on under wraps, choosing to remain “stealthy” even as large-scale leaks, including screenshots of the interfaces and functionality emerged on sites like YouTube and Tumblr. (
We reached out to Clinkle to provide comment, but the company has yet to respond to inquiries. See below for Clinkle’s response.)
Fortune says there had been a plan to disclose the Clinkle layoffs by announcing it alongside the news of high-profile new hires. The company had added COO Barry McCarthy formerly of Netflix, earlier this fall, and last week two of McCarthy’s former Netflix colleagues joined, including former Walmart and Netflix exec Andy Rendich as Clinkle’s VP of operations, and Allison Hopkins, formerly of Palo Alto Networks and Netflix, as VP of talent.
There was some hint from McCarthy that Clinkle needed work on its operations side of the business. As he told TechCrunch at the time, the company needed to build out its customer support team. “We need to build it from scratch, build it to scale, and built it to operate at scale,” he had said. There was not anyone at the company until Rendich who really understood how to do this, though.
Meanwhile, Hopkins was added to help Clinkle pick the right people and teach those already there how to manage. Reading between the lines, it’s a hint that those in charge weren’t ready to drive a company with $25 million in funding and the ambitious idea that it could replace your physical wallet with a mobilized version.
The layoffs then could be very well the result of McCarthy’s work – coming in, clearing house, and installing the right team. And that may be something Clinkle really needed. But as he told Fortune, the layoffs shouldn’t necessarily signal trouble for Clinkle:
“Some young people are leaving, and some very seasoned executives are joining. It’s reasonable to assume that these execs wouldn’t be joining if something was chronically wrong or broken.”
UPDATE: The following is a statement from Clinkle about the layoffs:
Our objective in today’s organizational restructuring is to better allocate our resources and work towards ensuring that we have the right people in the right roles. While turnover is a normal part of any business, especially in the startup world, it’s not easy or enjoyable for anyone. In all cases, we’re committed to managing these things as professionally and as considerately as possible. Today’s moves will better position our executive team to focus on adding the experience and functional expertise that we need.
16 employees (about 25% of the company) were affected in the areas of ops, growth, and human resources. This is in addition to the 30+ employees that were already reported to have left Clinkle by Business Insider.
With regards to the 30+ employees, to put it in perspective, some were part-time, some were students, some were contractors – as we grow, there are going to be changes in business strategy that result in people seeking opportunity elsewhere. As I said, in all situations, we’re committed to managing things as professionally as possible.