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Respond.com answers growth demands with staff cuts

The shopping site, which boasts such big-name backers as Benchmark Capital and Hummer Winblad Venture Partners, lays off 20 workers, or about 20 percent of its staff.

Shopping site Respond.com, which boasts such big-name backers as Benchmark Capital and Hummer Winblad Venture Partners, has laid off 20 workers, or about 20 percent of its staff, the company confirmed today.

Respond, which acts as a personal shopper for its customers, said the cuts affect all departments but were heaviest in marketing and services. The board of directors for the privately held company includes such Net stars as former Netscape executive Jim Barksdale, Benchmark's Bill Gurley, and John Hummer of Hummer Winblad.

Only a year ago, a common perception was that backing by marquee venture capital firms meant a company was immune to layoffs or closures.

Net start-ups fell over themselves trying to impress the Web's wizards. Their blessing and backing could add tens of millions of dollars to a company's valuation and were thought to ensure success.

Few believe that anymore. Even companies with big-name investors are falling prey to the effects of last spring's market crash. The last two months have been particularly hard on some of the Net's stalwart investors.

On Tuesday, online pet store and Hummer Winblad-backed Pets.com announced it would shut its doors. Net holding company CMGI this week witnessed two companies that it holds stakes in, MotherNature.com and Furniture.com, say they would cease operations.

Titan venture capital company Kleiner Perkins Caufield & Byers saw teen site Kibu.com close last month. Benchmark-backed PlanetRx has foundered for months, and Eve.com, in which Net incubator Idealab bought a controlling interest in April, closed down last month.

Respond chief executive Will Clemens said that his company shouldn't be lumped in with those that are struggling. He characterized the latest round of layoffs as "proactive."

"We want to put ourselves in a position where we don't have to raise money for at least a year and a half, which is where we are now," Clemens said. "We are still growing."