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Monday, March 23, 2009
Mzinga cuts 40 positions, Faulk leaves
By Galen Moore
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Mzinga Inc. last Thursday laid off 40 employees and said goodbye to former CEO Rick Faulk. The moves were first announced in a blog post by chairman and new CEO Barry Libert, who at one time shared the corner office with Faulk. The cut represented about 19 percent of Mzinga’s workforce of 210.
It was the second time the Burlington-based social media software company has laid off in this quarter. In January, the company announced layoffs of 15 staffers, citing weakened sales projections.
“(2009) is turning out to be a more choppy year than I think everyone expected,” said Libert. The cuts, which took place primarily in sales and marketing, but also affected the engineering department, gave the venture-backed startup a conservative posture for the current economic climate, he said.
Faulk, who helped Libert found Mzinga in 2007 from a merger of two companies, said he is leaving voluntarily, “for a mix of professional and personal reasons.” His previous role as co-CEO was not problematic, but his departure will help Mzinga as a company, he said. “It’s important that companies have a single focus and a single direction.”
Faulk will remain an investor in the company.
Faulk’s departure and the second round of layoffs have consolidated the company behind its new flagship product, an enterprise social media marketing, customer support and human resources platform launched into a beta trial stage earlier this year, Libert said.
In March 2008, Mzinga bought community content management software maker Prospero Technologies LLC, adding the Littleton company’s 43 employees to its own staff of 105. Mzinga was formed in 2007 with the merger of Woburn-based Shared Insights US LLC and Pennsylvania’s KnowledgePlanet Inc.
Libert, who originally founded Shared Insights, began working on Mzinga with Faulk when Faulk was CMO of the WebEx division of Cisco Systems Inc. (Nasdaq: CSCO). Faulk had run marketing for WebEx Communications Inc., acquired by Cisco in 2007, since his company, Intranets.com Inc. was bought by WebEx in 2005 for $45 million cash.
To date, Mzinga has received at least $32.5 million in new funding from an investor group that includes New York-based W Capital Partners and Chicago-based BlueCrest Capital Partners LP.
Along with last week’s layoffs, Mzinga made several internal promotions, moving Joel Worrall to vice president of engineering and development; Tamie Johnson to vice president of engineering services; and Dan Bruns to executive vice president and special advisor for social media.
Last month, Mzinga announced the hire of former Centive Inc. CFO Lisa Mastrangelo as company CFO.
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