Once-Hot Chat App Clubhouse Is Scaling Back By More Than Half

(Bloomberg) -- Clubhouse, the pandemic-era social media sensation, is scaling back its organization by half, the company said in a blog post on Thursday. The company raised more than $300 million from an elite stable of venture capitalists, according to PitchBook, but saw usership drop precipitously not long after its launch. 

When people were locked down during the Covid-19 pandemic, Clubhouse was a hit, drawing celebrities like Oprah and Elon Musk into long audio conversations with hundreds of people on the app. But once lockdowns eased, user numbers for the app fell quickly and it started to shift its strategy. 

“As the world has opened up post-Covid, it’s become harder for many people to find their friends on Clubhouse and to fit long conversations into their daily lives,” Clubhouse co-founders Paul Davison and Rohan Seth wrote in the post. “To find its role in the world, the product needs to evolve. This requires a period of change.”

Clubhouse said in the post that it would allow laid-off employees to keep their company-issued laptops and would pay four months of severance. 

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