Why People Are Leaving One of Silicon Valleyâ€™s Hottest Startups
J Thoendell stashed this in Tech
The people I spoke with described a company that seemed to be bursting with talent, but that lacked the sort of confident and assured leadership thatâ€™s expected at a company that managed to raise so much money from top-tier investors.Â Duplan, they told me, was an ambitious and smart young man, but didnâ€™t always make the best decisions.
The first person I spoke with, a 20-something who worked at the company for about a year, told the story of a run-in between Duplan and the staff in October 2012. At the time, he said, the companyâ€™s engineers were unhappy and decided to lay out their frustrations to management. Several of them spent an evening in the companyâ€™s Mountain View headquarters, on a company whiteboard, outlining what they felt needed to change. Many were unhappy, for example, that they were receiving a salary of only $40,000â€”far below the market rate in Silicon Valley for engineersâ€”and they were concerned about the lack of transparency in how the companyâ€™s equity was being doled out, according to the 20-something ex-employee.
One of the companyâ€™s engineers hand-delivered those notesâ€”a â€śmanifesto,â€ť as one of the ex-employees calls itâ€”to an executive on the business side and said, â€śHey, just so you know, weâ€™re really frustrated. We want to make this thing work, but as it stands, thereâ€™s a lot wrong.â€ťÂ According to another person present that day, who corroborated this story, a young woman hand-delivered the letter, a two-page printout, to Duplan.
Duplan fired her on the spot.Â
Why did investors give Duplan money???
Raise he did. Last June,Â Duplan, 22 at the time, announced he had landed $25 million for his company, Clinkle.Â SEC filings showÂ the company later raised another $5 million or so. Itâ€™s extremely rare for a startup to raise that kind of money out of the gate, particularly one run by a 22-year-old with no business experience.
Not much was known about Clinkle up until that pointâ€”it had no product on the marketâ€”but in a companyÂ blog postÂ titled â€śHello World,â€ť Duplan said Clinkle would reinvent the way we pay for things. Of course, tons of companies are already trying to do the same thing, but in his blog post, Duplan saidÂ Clinkle was â€śfundamentally different from everything else out there.â€ť
He called it a â€śbreakthrough.â€ť
But shortly after the June 2013 funding, Clinkle began shedding employees. One post on Quora, a popular Silicon Valley forum,Â listed about 30 employees that had left the company since its founding.Â Then, in December, another 16 people were laid off. ClinkleÂ confirmed the layoffs,Â but chalked it up to the natural â€śchurnâ€ť of running a startup. â€ś[A]s we grow, there are going to be changes in business strategy that result in people seeking opportunity elsewhere,â€ť a company representative said at the time.
The truth appears to be more complicated than that. Over the course of several weeks, I spoke with more than a half-dozen people, including a couple of former senior employees who had worked at the company over the last few years. I reached out to them via LinkedIn or email, asking them if theyâ€™d be open to chat about their time at the company. Mostly we spoke about what it was like to work with a 22-year-old boss who had managed to secure the â€ślargest seed funding in Silicon Valley history,â€ť as Clinkle trumpeted at the time, and why people were leaving.
They shared their stories and insights on the condition that they not be named. There have been a number ofÂ storiesÂ in recent months noting the companyâ€™s mini-exoduses and including vague industry gossip about the state of Clinkle. But I havenâ€™t seen any stories in which ex-employees actually talked about life at the company.