Sources said Kibu disclosed its plans to workers at a staff meeting Friday. The sources also said Kibu laid off most of its 65-person staff.
Kibu's Web site is still operational but is expected to close as early as next week, one source said.
A Kibu spokeswoman and Kibu executives, reached at home this weekend, would not discuss specifics.
Instead, they released a statement drafted for CNET News.com. The statement said: "Unfortunately, Kibu's timing in financial markets could not have been worse. With public and private markets for consumer Internet companies showing no signs of life, Kibu managers and directors concluded that Kibu's significant financial assets and employee talent would find a better return elsewhere."
The statement said "Kibu has decided to return its remaining capital to investors."
It went on to say that "Kibu is launching Kibupeople.com, a Web site that showcases the Kibu talent pool that is now moving on to the next big thing."
An official announcement is expected Monday.
Clark's well-publicized investment in Kibu came in February. Since then, investors have been bailing out of many dot-com companies.
One backer complained that Kibu investors threw in the towel too soon. "The fact that they wanted their money back after a few months is telling in itself," said one backer who requested anonymity.
Kibu offered content and chat rooms aimed at girls between the ages of 13 and 18.
Kibu was founded in 1999 and attracted a $22 million investment from Internet heavyweights Clark, former Excite@Home chairman Tom Jermoluk, and venture capital firm Kleiner Perkins Caufield & Byers.
Other Web sites, such as Snowball.com, Alloy.com and Bolt.com, recently have emerged targeting the growing number of teens jumping online. Internet research firm Jupiter Communications estimates that 47 percent of teens use the Net.
The business downturn among Internet companies has led to numerous shutdowns and Web site staff reductions. Last week, online health site WebMD announced it would eliminate roughly 1,100 jobs as part of a restructuring move in response to several recent acquisitions. Garden.com, the online seller of everything from plants to hoses, will cut its staff by about 40 percent. Viacom's MTVi will lay off nearly 25 percent of its staff.
Kibu's board of directors includes Clark; Jermoluk; Kibu CEO and co-founder Judy MacDonald; Dave Roux, co-founder of Silver Lake Partners; Jeffrey Berg, chairman and CEO of International Creative Management; and Shelby Bonnie, CEO of CNET Networks, the parent company of News.com.