Social Media Darling Clubhouse Slashes 50% of Workforce

Clubhouse, the audio-only social media app that once had major buzz, is set to lay off more than half of its employees as it seeks to adapt to market conditions following the coronavirus pandemic.

The Verge reports that in an effort to adjust to a post-coronavirus world, Clubhouse, the once-popular audio-only app, plans to fire more than half of its staff. Paul Davison and Rohan Seth, the company’s co-founders, stated in a memo to staff that a “reset” was necessary, along with a move to a smaller, more product-focused team.

“As the world has opened up post-Covid, it’s become harder for many people to find their friends on Clubhouse and to fit long conversations into their daily lives. To find its role in the world, the product needs to evolve. This requires a period of change,” the founders wrote.

The memo outlined the difficulties the business encountered in maintaining effective communication and implementing changes quickly with a sizable workforce. According to Davison and Seth, downsizing will enable them to better align their strategy and change with the tech industry.

In 2020, Clubhouse became popular as an invite-only app that let users join remote audio conversations during coronavirus lockdowns. Due to its popularity, other tech behemoths followed suit, introducing features like Twitter Spaces, Facebook Live Audio Rooms, and the now-defunct Spotify Live.

However, in the face of fierce competition, particularly from Twitter Spaces, Clubhouse has found it increasingly challenging to maintain its relevance. In August 2022, the app unveiled a brand-new function called “Houses” in an effort to reposition itself in the market. With the help of this feature, users can create private chat rooms for more personal interactions with their current friend groups.

“We have a clear vision for what Clubhouse 2.0 looks like and we believe that with a smaller, leaner team we will be able to iterate faster on the details, build the right product and honor our teammates who helped us get here,” said Davison and Seth in the memo.

Clubhouse is currently going through a transitional period, and it is unclear how the platform will change to meet the evolving needs of its users and regain its position in the audio-only market.