mocoNews - ChaCha Cuts Staff, Salaries To Make $12 Million In New Capital Last Longer
Wednesday, March 18, 2009; 7:00 PM
Carmel, Ind-based ChaCha, which helps people search for answers over mobile phones using SMS, confirmed it has raised $12 million in new capital. The investment was first reported in January, but only confirmed by the company yesterday in a press release. The company said the capital will go towards expanding its local and national advertising sales activities, including a newly opened New York office. However, the company is making a number of cuts to ensure that the company hits "revenue and expense goals," reports indystar.com. The cuts included laying off 25 employees and a 10 percent salary decrease for all employees, with some executives taking even bigger hits. The layoffs were made in all divisions, except sales and sales support.
The company didn't say which investors participated in the round, but previously it raised $14 million from Morton Meyerson, Bezos Expeditions, Rod Canion (founding CEO of Compaq) and Jack Gill (partner at Maven Ventures), according to peHUB. It also had secured a $2 million grant from 21st Century Technology Fund. The company's goal for the most recent round also appeared to be as large as $30 million at one point, but apparently the target was not reached.