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Sermo Inc., the Cambridge-based maker of an online social network for physicians, has laid off staff and will shift its business strategy, CEO Daniel Palestrant confirmed this morning. The layoffs occurred earlier this week, he said.
As of last fall, Sermo was on a hiring spree, fueled by a $27 million Series C venture round closed in 2007. At the time of the financing, the company said it planned to grow from 50 to 100 staffers in 2008. Palestrant declined to say how many employees were cut, but the blog Xconomy, citing an unnamed source within the company, said the cuts affected 30 employees.
Palestrant said that with the cuts, Sermo is profitable. The company has shifted its focus from the financial services sector to pharmaceutical companies, he said. The company plans to remain in its Kendall Square headquarters, but Palestrant declined to say whether Sermo plans to recover some of the staff it has lost.
Founded in December 2005, Sermo had launched with plans to charge fund managers and analysts access to its network, where physicians are invited to share opinions and insights about treatments and devices. “We had very high hopes for the financial services industry and we’re going to be focusing now exclusively on the pharma side,” Palestrant said. “That decision came with some changes in personnel.”
The company’s backers include New York-based Allen & Co. LLC and Baltimore-based Legg Mason Investment Trust Inc., who led the 2007 Series C round, and Newton-based SoftBank Capital Technology Fund and Waltham-based Longworth Venture Partners. Total venture funding to date is at least $39.5 million.
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