Adbrite Lays Off 40% Of Staff, Including Two Execs
Thursday, October 16, 2008; 9:00 AM
It's not a happy day at San Francisco-based Adbrite this morning. The company is laying off 40 employees, which is 40% of total staff. Among those that are leaving are VP Marketing Paul Levine and VP Finance Bob Feller.
This is the second Sequoia-backed startup to report significant layoffs after last week's meeting where Sequoia warned the CEOs of their portfolio companies of the long lasting effects of the downturn, and urged them to control costs and become cash flow positive. On Tuesday Jive Software, also Sequoia-backed, had a significant reduction in headcount as well.
There is a silver lining to the layoffs, or at least for those who still have a job at Adbrite: The company will now be cash flow positive and profitable, CEO Iggy Fanlo and Levine said in a phone conversation. The company had gross revenues of $32 million in 2007. He won't discuss current revenues, other than to say it continues to grow, and that October will be a record month.
This isn't the first time Fanlo has been through big layoffs. He was President and Chief Revenue Officer at Shopping.com during the first bust, where the company let more than 200 of 300 employees go over three cuts. The company went public in October 2004, and was acquired by eBay in June 2005 for $620 million. He says one thing that he learned from going through the tough times - make cuts early and deep to give the company the best chance possible of getting through it. Clearly he put that theory into action today.
Adbrite is a top five advertising network according to Comscore. They sell advertising for 70,000 websites and serve 1.3 billion ad impressions per day.
The irony of Adbrite making cuts isn't lost on us. The company was originally spun out of FuckedCompany.com in 2003 by founder Philip Kaplan. FuckedCompany, of course, brutally chronicled the layoffs and liquidations that marked the end of the 2000 Internet bubble (and was the subject of our 2007 April Fools prank, which was much funnier in the middle of a bull market). If the site were still live today, Kaplan would be writing about this there.