Struggling Vimeo To Lay Off 11% Of Workforce, Company President Resigns
Vimeo, the video streaming platform that was once an essential resource in the independent animation and filmmaking community, has struggled to become a sustainable and profitable company after its pivot to a tech platform.
The New York-based company is laying off a significant portion of its staff, while its president has announced his resignation.
Why is the company struggling? The company’s CEO Anjali Sud sent a letter to employees yesterday citing “ further deterioration in economic conditions, in the form of prolonged geopolitical conflict, rising interest rates, and global recession fears.” Sud also said that post-pandemic there is less demand for the company’s“self-serve” video solutions.
How many people are being laid off? The company is reducing the size of its workforce by 11%, which in the words of Sud, is “the right thing to do to enable Vimeo to be a more focused and successful company.” It follows a 6% reduction in staff that was announced last summer. An exact number of employees was not provided, but based on the last publicly available data about the workforce, we can estimate that the layoffs will impact around 125 people. Sud said that there will be reductions in “nearly ever region and department at Vimeo,” with the majority of people impacted in sales and research & development.
Big picture: Vimeo became an independent publicly traded company in 2021 after spinning off from Barry Diller’s IAC internet holding corporation. Around the same time, the company’s CEO made clear that the company was abandoning filmmakers and animators who had relied on the site as a distribution platform for their work. Said Sud: “[W]e are not focused on eyeballs and content on Vimeo. We actually don’t want Vimeo to be an entertainment destination where people come.”
As a standalone company, Vimeo’s market cap has plummeted 94% in the last two years. In the third quarter of 2022, the company reported revenue of $108.1 million, but still had a net loss of $21.4 million (up from a loss of $11.7 million from the same year-earlier period).
The company’s president is also stepping down: Independent of yesterday’s announcement, the company announced in an SEC filing on December 20 that its president Mark Kornfilt was resigning from the company, effective March 31, 2023. Kornfilt is expected to continue as an advisor to the company.