Two dozen people in sales and sales support were cut today from 115-person RJMetrics, the Center City-based business analytics company, CEO and cofounder Bob Moore confirmed to Technical.ly.
Those 25 layoffs represent about 20 percent of the staff at one of Philadelphia’s standout tech startups. The company now employs 90.
In the fall of 2014, RJMetrics announced a $16.5 million Series B investment round. “All this money is going to create jobs here,” Moore said then. What’s changed is a focus on a surging second product that the company launched at the end of 2015, which requires less client on-boarding, said Moore.
“We didn’t do the right thing for these people,” Moore said in a prepared statement. “We recruited them onto our team and, now that the situation has changed, they are losing their jobs due to circumstances they didn’t create. We’re truly sorry to everyone affected.”
Moore said RJMetrics is extending “severance, extended health insurance coverage, an extended window in which to exercise their stock options and job placement assistance.” Moore and cofounder Jake Stein, among others, are hoping to place many of those laid off with other local tech firms. (Moore asks that you email him at rmoore at rjmetrics dot com if you want to share an opening you have.) Moore named Curalate, Zonoff, Guru and Sidecar as examples.
So does this mean the RJMetrics hype, as one of the city’s strongest tech startups, is unfounded? No, Moore says. This has everything to do with an updated product pipeline and nothing to do with a company on the ropes, he argued.
“This change is about being true to our strategy and running a responsible business,” said Moore. “This was an extremely difficult decision to make, but a necessary one for building a responsible company focused on long-term success.”
Of course, there’s another side to this — one from a frustrated bunch of people who took jobs with an exciting young startup only to see that direction change without them.
We exchanged emails and texts with at least two team members today, though neither wanted to be named in this report. Big changes at the top come with concerns below, so when new VP of Sales Shawn Brady lasted just five months some began to get anxious.
“RJMetrics has fooled many many people in the recent months,” said one of the teammates in an email. How much is that frustration and how much is that insight? Frankly, that’s hard to tell now. It’s something that Moore said pains him.
“We have to get back to doing the work,” Moore said in a phone interview with Technical.ly. (For context, another longtime employee confirms that the strategy re-focus seems like a more plausible reason for the layoffs than any company struggles, calling it “great for the company.”)
Here’s why Moore says these layoffs went down.
In the last year, the RJMetrics team has continued to grow its primary CloudBI business-optimization product, said Moore, but nowhere near as quickly as the company’s newer Pipeline offering, a way for RJ customers to consolidate various data sources into a data warehouse in the cloud. Pipeline is far more self-service, requiring less staff on-boarding. So the staffing up in sales and support proved unnecessary, Moore said.
“This year, we are on track to see 10x the sales that CloudBI generated in its first year on the market,” said Moore. “This success is changing the way we think about how we sell to and support customers, and that’s a major driver of this change.”
Moore is not particularly emotive. He’s a Princeton-made finance guy, with the analytical mannerisms that come with it (early rap stylings aside). On a phone interview this week and in years of other conversations, he doesn’t show the feelings you might expect for a still-young, first-time founder on the tech startup rocket ship announcing a very public misstep. He’s trying to make it right and get back to building a company, but he won’t wallow in it. He said he plans to speak publicly about what he’s learning from the experience — the necessity of mentors for tough decisions and the economics of high-growth companies — but it will likely be far different than, say, the gut-wrenching failure story from Bob Moul.
For one, as Moore is quick to say, this is a staff re-alignment, just a blip on the growth trajectory, he said. For example, RJMetrics is keeping its expanded office space even with these layoffs, Moore said.
“You have to do what makes a better company,” Moore said.
Others locally are in the midst of determining what layoffs can mean for the narrative of a tech startup’s growth pattern.
Monetate, the Conshocken ecommerce-optimization company, announced its own round of layoffs in October 2014 after bringing on new CEO and tech scene veteran Lucinda Duncalfe (listed among this community’s best spokeswomen) right around when RJMetrics announced its Series B. Now Monetate, one of the region’s first big post-dot-com-bubble tech companies, is in something of an identity shift, as leadership prepares for a possible IPO.
This is the messy business between founding myth and corporate cruise-control.
“We are still a growing company — we’ve just restructured how we add and support new customers,” said Moore, mentioning RJ’s careers page. “We’ve made several new hires in the past few months that are not impacted by this change and you will continue to see new positions created throughout the year.”