- Patreon SVP Carlos Cabrera advised employees in a September memo that the firm’s valuation had fallen 70%.
- Patreon was final publicly valued at $4 billion in April 2021.
- The firm additionally inked million-dollar deals with top TikTokers like Larray and Lil Huddy that produced meager outcomes.
Internal documents obtained by Insider portended the headwinds dealing with Patreon simply 10 days earlier than it issued layoffs of 17% of its workforce, or roughly 80 of its 470 workers.
Patreon’s SVP of finance Carlos Cabrera wrote in a employees memo on September 3 that the firm’s valuation had dipped considerably – to the tune of 70% over the past year.
“Most of the companies that had benefited from COVID lockdowns have experienced the opposite effect with COVID recovery,” he wrote.
The valuation that Cabrera was referencing was Patreon’s 409A. These valuations are calculated by outdoors auditors to find out the worth of a personal firm’s frequent inventory. (It differs barely from the post-money valuations corporations get when fundraising, that are usually primarily based on the worth of most well-liked inventory).
Patreon was final publicly valued at $4 billion in April 2021 amid a $155 million Series F led by Tiger Global Management. A 70% drop would imply that it’s valued at lower than $1.5 billion immediately.
Insider additionally reported in September on how Patreon’s million-dollar deals to onboard top TikTokers Larray and Lil Huddy fell spectacularly flat – with each raking in round $2,500 throughout their first months on the platform, far lower than the firm anticipated.