Advice site swallows bitter pill with layoffs
Online advice site Exp.com lays off 15 percent of its staff in an effort to move away from the business-to-consumer market and refocus on providing services to businesses.
The Menlo Park, Calif.-based company cut 17 staff members last week in an effort to move away from the business-to-consumer market and refocus the company on providing its technology and services to other businesses.
Despite the layoffs, Exp.com is "not in trouble," said company spokeswoman Emily Magee, noting that Exp.com is hiring for sales and engineering positions.
"We are realigning our resources to go after this huge opportunity in corporate services," Magee said. "We're building up the departments that are most crucial to our new strategy."
The layoffs were effective last Tuesday, she said. Employees were given a severance package.
Exp.com is the latest company to announce a restructured business model.
The online advice market has become increasingly crowded in recent months. In addition to start-ups such as Keen.com, AskMe.com and Expertcity.com, Exp.com also vies with portal giants such as Yahoo, NBCi and Microsoft's MSN, all of which recently entered the advice service industry.
Exp.com has already made steps toward partnering with other businesses. In July, the company announced an agreement with Entrepreneur.com that links Entrepreneur.com readers to Exp.com's experts. In June, Exp.com signed a deal with Ask Jeeves to advertise its services on the online answer site.
Exp.com will expand on these deals, planning to announce four new partnerships in January, Magee said. She declined to say which companies the partnerships will be with, saying only that they related to providing tax advice.
Launched last year, Exp.com connects consumers seeking advice with self-described experts via email, telephone or instant messaging. Experts are free to set their own rates, but Exp.com charges a 20 percent fee to experts who use its service.
Exp.com has raised some $60 million in venture funding, most recently in a $33 million third round in June. Among its investors are Ask Jeeves, MeVC Draper Fisher Jurvetson, Bessemer Venture Partners, and CMGI@Ventures.
The layoffs at Exp.com are only the latest setback for a CMGI-backed company. Last week, CMGI shut down its iCast entertainment site. The incubator, which was hit last month with a slew of downgrades from Wall Street analysts, has also made plans to close free Internet service provider 1stUp.com and has overseen the recent closures of MotherNature.com, Furniture.com and Productopia.