Brit + Co, a buzzy digital media brand for millennial women, is laying off most of its employees after an acquisition failed to pan out, Recode has learned.
Digital media lifestyle brand Brit + Co is laying off most of its employees
Another casualty of Facebook and Google’s advertising duopoly.
CEO Brit Morin, a prominent Silicon Valley executive who is also the figurehead at the core of the site’s brand, told staff on Monday that the company is dealing with financial issues after the acqusition talks crumbled and was until recently working to secure a last-minute investment. She had to answer questions from her 50-person staff about whether they will receive any more paychecks from the company, according to people familiar with the matter.
A fuller update is expected to come to staff on Tuesday afternoon, when she is expected to describe the company’s next steps.
Morin told Recode that her company was not shutting down, but confirmed that it was laying off a large number of her staff. She said she did not yet have an exact number, but said that a “decent-sized team” would remain.
“We see the Brit + Co brand being valuable as a brand and less as a digital publishing business,” she said. “The last decade of media and the next decade of media are going to be completely different.”
Some staff has been frustrated that Morin was not being more transparent with them about the company’s financial woes. Morin’s answers to questions at the company meeting on Monday were described as tight-lipped — she did not identify the possible acquirer — and the meeting lasted at most 15 minutes.
Morin declined to comment on what exactly happened with the acquirer, but said the company has had “plenty of strategic options” in recent years.
A person close to the company said Brit + Co was in constant talk with possible acquirers, but also frequently maintained a thin cash cushion. “They would always run it kind of close,” said the person, who has frequently thought: “When is the time that runway is not enough — when it needed to be 12 months longer than it was?”
The company, which runs a lifestyle website that it says reaches 130 million people a month — mostly young women — is poised be the latest digital media company in recent months to suffer a hard landing amid a cash crunch and competition from advertising behemoths Facebook and Google. Mic, a well-funded site that promised to be the marquee news source for millennials, sold in a fire sale late last year. Other venture-backed sites, such as BuzzFeed and Vice Media, have recently had to make waves of layoffs.
Morin, a well-connected operator who considers Martha Stewart an inspiration, has pitched herself as something of a role model for the new generation of media executives. Since starting the company at the age of 25 eight years ago, she has expanded Brit + Co into other revenue models like live events, online classes, and direct-to-consumer merchandise.
But Morin has been at the core of the company’s strategy.
“The number of people who asked me, ‘What happens if you get hit by a bus?’ is more than I can count on my fingers,” she said on Recode Media in 2017. “To me, developing a company that was all about giving back to creative America and these artisans who live in small town USA — and go to like Jane’s Nails and Fred’s Auto Shops, where you know Jane and you know Fred, and you have that trust and that authenticity factor with those real humans — was so important to me, and that outpowered the idea that Brit could get hit by a bus tomorrow and the company could die.”
The company has raised at least $50 million from venture capital firms like Lerer Hippeau, Oak Investment Partners, and Verizon Ventures.
Brit + Co, though, has shown signs of duress and has tried to cut costs in recent months on things like video production, the person close to the company said. Last year, it laid off some employees, with its team page showing 92 employees in September 2017 but only 78 as of January. Other positions since then have not been filled, people say. As of now, only 52 names are listed on the site.
Over the next few days, that number will drop even more.
This article originally appeared on Recode.net.
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