In April 2021, Patreon raised a $155 million funding round that came with a $4 billion valuation attached to it. The fan-funding platform had gained a wave of new users during the pandemic and was planning a move into original content. Business seemed to be booming at the company founded by musician and YouTuber Jack Conte.
19 months later, Patreon is reversing course. On Instagram, Conte announced a round of layoffs that will affect 80 Patreon employees and reduce the company’s workforce by 17%. The post cited the ongoing “economic slowdown” as the catalyst for the cutbacks. Snap CEO Evan Spiegel cited a similar rationale when he announced the most recent round of layoffs at his company.
“It has become clear that the original plan we built for the year, to support outsized growth through the pandemic, is no longer the right plan for the company,” Conte wrote. As Patreon downsizes, it will close offices in Berlin and Dublin, according to TechCrunch. The engineers who worked out of the Dublin branch will be offered relocation packages.
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Patreon also endured a round of layoffs at the start of the pandemic, but Conte doesn’t want his platform’s users to worry about its ever-shifting workforce. In fact, he claims that Patreon’s latest set of pink slips will allow the company to consolidate its business around its core products. “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 on Instagram. “So for those of you who rely on Patreon for your business and communities: I want to assure you that the company is making this move precisely for that reason — so we can continue to be a rock for your businesses.”
Conte cited native video as one product Patreon will focus on moving forward. Long-term, the company plans to optimize its user experience while developing new content creation tools.
Less than a week before Conte announced the 80 layoffs, Patreon revealed that it would let go of five security engineers. Conte told TechCrunch that the two groups of cuts are not related.