Looks like the departure exactly a month ago of long-time Ning CEO Gina Bianchini was not as benign as Ning tried to portray it. The build-your-own social network startup is laying off 40 percent of its staff, or 69 employees, and is moving to an entirely paid model. In a note to employees, new CEO Jason Rosenthal says he’s taken a “hard look at our business” and determined that “we need to double down on our premium services business.” Rosenthal says Ning’s “premium” networks drive the majority of its traffic and “will pay for many more services and features from us.” Existing free networks built on Ning can quit the service or pay up.
Rosenthal’s letter provides quite the contrast to Ning Chairman Marc Andreeseen’s statement when Bianchini left. At the time, he said “nothing else is changing” and noted Bianchini’s “amazing series of accomplishments in her time as CEO.”
This is a huge comedown for a company that was famously featured in Fast Company, talking about how it would get “billions” of page views and therefore attract a “nice slice” of the then rapidly growing online ad market. As recently as a year ago, when the company raised $15 million at an incredible $750 million valuation, the dream was apparently still living on.