on decktechnology A company that connects founders with each other, funding and advice has made another round of layoffs just three months after laying off a quarter of its workforce. The layoffs affected more than 100 people, or half of its workforce, sources said, while the company (which confirmed the layoffs to TechCrunch via email) said 73 full-time employees were made redundant.
When asked about the discrepancy in the numbers and whether more people were affected by different employment statuses, such as contractors, a spokesperson for On Deck said they had no further comment. The company offers eight weeks of severance pay, three months of accelerated option vesting and three months of health insurance for everyone who leaves the company.Those interested in recruiting laid-off talent can request access to the list of people looking for new roles.
On Deck, not to be confused with small business lender OnDeck, is a company that provides capital and network support to emerging fund managers and founders. The company launched in June 2019, first announcing a founders scholarship, and has recently grown to offer more niche programs in specific verticals.
It was this widespread focus that led to the need for downsizing, according to co-founders David Booth and Erik Torenberg’s description of the company. “During the past two years of rapid growth, On Deck has launched a community of more than 10,000 founders and career professionals. Our team has worked tirelessly to expand and cover large areas,” The pair wrote in a blog post about the layoffs. “However, this broad focus has also created serious tensions. What we’ve always thought of as an advantage — serving multiple user bases and building a flywheel between them — also undermines our focus and our brand.”
The startup said it closed several communities and layoffs affected all levels and all departments; although it did say no executives were fired, this contradicts that statement. On Deck also spun off its career development division to “focus on developing a learning community for mid-career professionals who want to accelerate their careers.” The business will be led by former community lead Mindaugas Petrutis and serve On Deck’s current design, engineering, data science, marketing, business development and sales, chief of staff, and No Code communities.
“Allowing our founders and career programs to operate under separate entities, led by people who are passionate about these communities, will allow each team to focus on the needs of their core clients and ultimately lead to better outcomes, ” the company told TechCrunch in a statement.
A spokesperson said that On Deck’s career development business “generates quite a bit of revenue”, so it doesn’t require much additional capital — aside from some seed money the company already provides — to get started. The name of the new company is still under development.
In other words, after serving 10,000 founders to date, On Deck is now focused on helping early-stage founders scale. Its other programs, those focused on career professionals, will be phased out or spun off into a new company.
That’s in stark contrast to the tone of Tollenberg and Booth during the last layoff. In an email obtained by TechCrunch, the co-founders talked about the challenges facing the company’s recently launched ODX accelerator.
“In 2021, we launched the accelerator ODX. We saw an opportunity to stand up and try to innovate the stagnant accelerator market. Many believed that we succeeded in achieving this goal,” the email reads. “Unfortunately, during the same period, the market started to change dramatically. A few months later, the capital and accelerator markets were very different from where we started. These factors forced us to reflect and consider how On Deck will continue in the future, supporting our community and ensure long-term sustainability.”
While accelerators may need to downsize, On Deck did return to its founder-centric roots in May. The company relaunched the On Deck Founders platform, which helps founders scale their startups through IRL and virtual programming, and On Deck Scale, a platform that lets founders behind high-growth businesses learn how to become better leaders s project.
Sources estimate that the first round of layoffs happened because On Deck had only nine months of runway left. The last time the startup raised known VC funding was in March 2021 with a $20 million Series A round led by Founders Fund.
The startup didn’t answer whether it plans to raise capital anytime soon, but did say it’s well-capitalized enough to launch in more than three years.
Mike Butcher contributed reporting for this story.