According to this re/code report the once ecommerce darling is laying off 50% of its staff in a struggle to stay alive.
LivingSocial is laying off around 280 employees in the latest move aimed at trying to stanch the bleeding at the one-time e-commerce darling and Groupon foe.Photo Credit Danny Eugene
The layoffs account for between 50 percent and 60 percent of the current staff, though around 120 of those jobs in customer service will be replaced through outsourcing. LivingSocial will employ around 200 to 225 people after the cuts.
In an interview, CEO Gautam Thakar said the company has gotten its legacy voucher-deals business to break even, and wants to allot all future investments to its new, so-called “card-linking” discount business.
That product, which is being tested in three cities, allows LivingSocial customers to get discounts at participating restaurants simply by paying for a meal with a credit card they have registered with LivingSocial. Restaurants control when they offer discounts and how big they are. He said the company has signed up three times the number of restaurants in these cities for the new offering as it had for its traditional voucher business.
Thakar said he is interested in raising new funding for the company from outside investors and would use some of those funds to expand the new business into new cities and new categories beyond dining.
The CEO told Re/code that the cuts are not an attempt to dress the company up for a sale, but said he “might be open” to those conversations if they arose during the process of trying to secure new investments.
The company has raised more than $900 million to date from Amazon, J.P. Morgan and Lightspeed Venture Partners.
The Washington, D.C.-based company has now cut nearly 900 jobs over three rounds of layoffs since Thakar took over for founder Tim O’Shaughnessy 18 months ago.