Former Gumroad employee here. Since we didn't write about this, here's a response from the other side-- we weren't blindsided by this. We knew there was a chance we wouldn't get our series B, yet we believed in the product. The numbers looked great (the best they had ever looked). And we wanted to see this work, whether or not it meant being part of it in a few months.<p>This isn't some photo sharing app; many creators earn their living from Gumroad. When the time came to make a decision whether to be acquired and have the product die, or to downsize and have the product live on, this choice involved a lot more than our 20 person team. It involved the thousands of creators that rely on Gumroad. With or without me, I still believe in Gumroad.
<p><pre><code> The company had 22 employees as of earlier
this year, and it has been in the process
of laying off all but what is expected to
be around 3 of its staff.
</code></pre>
Normally, when I hear the words "layoff" and "restructure", I think 15% of the company, not 'basically everyone.' That's a bummer, and I expect this won't be the last time we hear this story this year.<p>I hope the frontend engineers making $75,000-$125,000[1] for a shot at one day accumulating up to 1% of Gumroad decide to pursue market wages at the next company they join :-\ The economics of startups rarely offer a worthwhile return to those who choose to play the game. For what it's worth, this is something I've found out the hard way.<p>[1] <a href="https://web.archive.org/web/20130516103241/https://angel.co/gumroad" rel="nofollow">https://web.archive.org/web/20130516103241/https://angel.co/...</a>
I run a company called SendOwl, which is probably the biggest competitor to Gumroad, and I must admit I'm sad to see this. We've been watching them over the years and have been impressed with some of the work they've delivered. I've also met a few of their employees and have liked their thinking around selling digital goods and where it's going. You could see they wanted to make a success of the company.<p>Their problems, in my opinion, have come from being VC backed. VCs ultimately want thier money back and with this comes massive, often unrealistic growth expectations. I've had a lot of offers of VC money for SendOwl over the years but I've never once considered taking it. I've bootstrapped SendOwl because I wanted complete control of the company, to direct where I thought it should go, to create the company where I wanted to work at (we work a sensible 9-5, I spend lunchtimes hitting the gym...), but most importantly to serve our customers and build something for the long term. This last part is something I've always seen as uncompatabile with the VC model.<p>The VC model is alluring though - VC money makes growing quickly easier, it makes getting PR easier and it makes bringing in lots of staff early on an easy decision. I'm not saying it's right or wrong per say, it's just not the path I wanted to go down. Bootstrapping isn't as sexy as VC money, but as long as we're growing, getting great customer feedback, and innovating with new features I know we're on the right path. Focus on those three things with Boostrapping and it's hard to go far wrong to be honest.<p>Interestingly we're getting more and more people asking about us as a company and whether we'll be around long term, so maybe the tide is starting to turn. Anyway I wish everyone leaving Gumroad all the best for the future. And any sellers out there who are interested in alternatives please check us out at: <a href="https://www.sendowl.com" rel="nofollow">https://www.sendowl.com</a> Happy to also answers questions in the thread below!
Interesting. I've been a customer of theirs for ~2 years. It's been really great until a couple months ago. Then something seemed to change. Rather than just being a great payment provider, they seemed to change direction in order to become a "platform".<p>In emailing with Sahil about my concerns about Gumroad's new direction, he said "We want Gumroad to be the core channel for everything. We started with sales, and are moving into audience/list management."<p>He made it clear that they want me to import my audience lists to Gumroad and that they don't plan to support future integrations with CampaignMonitor, Mailchimp, etc. That makes sense, since those email platforms are now the competition I guess. It's bad news for me though - if I wanted to stay with Gumroad, I'd now have a project on my hands to move everything over to a (currently) much less powerful email platform.<p>I imagine this will work for many of their customers, but there are customers like myself that don't want to be pushed in this direction. I prefer to keep my audience management separate from my payment provider. I don't want my payment provider deciding that my customers are now their customers that they can now spam and upsell them in order to grow their platform. I'm not saying that that is Gumroad's plan - but I'm increasingly worried that it might be. Particularly if they get in a "desperate for growth" situation like this article hints at.<p>Again, they've been great for years and I really appreciate that. The new direction just seems too risky and not a good fit for folks like me who don't want their payment provider as the middle-man for communicating with their audience.<p>I guess there's an argument that they're not a payment provider, but a "sales platform" or something.<p>Currently I'm looking for a replacement payment provider (or whatever they should be called) to use. SendOwl looks promising. If you've used them, or have another provider you'd recommend, please let me know!
> has been in the process of laying off most of its staff in an effort to run more efficiently<p>Is that meant to sound quite as much of a death knell as it does to me? I hope not.<p>I've made a few comics purchases through Gumroad (Skin Horse, Narbonic, and Inhuman Relations, amongst others), and found the process quite delightfully straightforward. I do hope this isn't their end - they deserve better.
Huh? I thought Gumroad was one of the better services out there for selling stuff. Too bad "hypergrowth" mania devalues companies like Gumroad because they look like a pretty awesome and sustainable business.
I remember when Gumroad was announced on Hacker News 4-5 years ago as a little weekend project.<p>"Over this past weekend I had the idea to build a sort of link shortener but with a payment system built-in... I think it has some potential. What do you guys think?"<p><a href="https://news.ycombinator.com/item?id=2406614" rel="nofollow">https://news.ycombinator.com/item?id=2406614</a>
That's pretty surprising...<p>You would think with 15K creators and their traffic they would be able to monetize better... having to cut down to only <i>three</i> employees suggests they aren't making much revenue at all...
The real question is, why did they have 22 employees? I think this would have been an incredibly profitable one-man business (think TinyURL) but it tried to be something that was very hard for it to be.
Intermediaries get disintermediated. Braintree is a tad bit closer to the iron and maybe (if PoW conundrum finally overcome and after debt is introduced) crypto will do it again.
SHL learns a ton from this, gets experience most executives don't have. Optimistic in his future either way.<p>To the GR team, your work is not marginalized by this speed bump. GR is really good and something people love.<p>I hope other people recognize that and snap up everyone into good places.