According to a report by TechCrunch, Evernote has just cut 15% of its staff, totaling 54 employees. In a follow-up blog post by CEO Chris O'Neill, this is because the company "committed too many resources too quickly" in its "incredibly aggressive goals." Whatever the cause, combined with the recent mass-departure of executives and O'Neill's vocal focus on self-sufficiency, it's hard not to be concerned with the company's future.
Evernote was once something of a tech-household name, as one of the most commonly used note-taking services. A couple of years back, it severely limited its free plan and significantly raised general prices for premium options, driving millions of customers into the welcoming arms of OneNote and Google Keep.
Two weeks ago, TechCrunch reported that Evernote's CTO, CFO, CPO, and HR head all left within the same month, with responsibilities being curiously redistributed among other existing and newly-hired employees, rather than seeking their replacement. This change happened while the company was alleged to be fundraising (and, perhaps, a bit short on cash as a result), though an internal memo provided to TechCrunch refutes that.
This same memo is how TechCrunch learned about the firings, and it is included in its entirety just below:
For those of you who missed our All Hands today, I have some difficult news to share.
As part of an ongoing evaluation of our business, we’ve decided to make a tough, but necessary decision to set Evernote up for future success. We’ll be saying goodbye to 54 talented and dedicated people, each of whom has contributed to Evernote’s mission. This was an extremely difficult decision and one that we did not take lightly.
As you’ve heard me say during the past few months, I set incredibly aggressive goals for the year. We’ve grown significantly this year, but at the same time we invested too far ahead of that growth.
We must adjust quickly when part of our strategy is not meeting our expectations. Going forward, we’re streamlining certain functions and will continue to make investments to speed up and scale others, like product development and engineering.
I understand that today’s news may cause concern. We need to remember our amazing community of people who rely on our products and believe in our mission. Together, we have built a product that serves over 225 million people around the world who trust us with more than 9 billion notes containing their most important thoughts, ideas, and inspirations.
As I discussed in All-Hands, Evernote grew over 20% in the first half this year and we are in a stable financial position. Our Q3 revenue numbers remain strong and we expect to end the quarter north of $27 million. We have over $30 million in cash on our balance sheet and will exit 2018 generating more cash than we spend.
Though today is hard, this is the right decision for the business and the best way for us to invest in our future. For those friends and colleagues impacted today, we’ll be providing severance and other benefits to support them in their transition. We’ll have a series of AMAs to answer your questions that were not addressed today. As always, feel free to contact me with your questions. Tomorrow, I will publicly address our customers, partners and community on our blog.
In response to news coverage of the company's firings, Evernote's CEO put together a blog post meant to provide a bit of context for the recent actions. While it doesn't directly address the staff cuts, it does make a few surprising admissions of error in its previous plans, stating that the company has a new focus to operate more efficiently, expand infrastructure, and streamline leadership.
Evernote may never be the universal product it once was, but it's unfortunate that 54 employees had to lose their job as a result.