Techstars layoff staff, closes AdvancingCities program

• Published On: 09 August 2024 at 05:15

Techstars will lay off 17% of its workers and discontinue its $80 million AdvancingCities program by the end of the year.

The AdvancingCities program, funded by J.P. Morgan, was launched in 2022 with the goal of supporting diverse founders through accelerator programs in cities such as Oakland, New York, Miami, and Washington, D.C. Despite initial enthusiasm, the cooperation with J.P. Morgan stalled, and the bank refused to commit to maintaining the program beyond its first funding period. This lack of commitment has left approximately 20 Techstars employees who worked only on AdvancingCities concerned about their future.

A J.P. Morgan representative affirmed that the fund would be completely deployed by the end of 2024, as anticipated, and emphasised the bank's continued commitment to supporting diverse investments in the United States through other channels.

Techstars co-founder and CEO David Cohen announced the layoffs, citing overexpansion and overhiring. The majority of the layoffs will hit the engineering, support services, and sales and partnerships teams. Staff who manage other accelerator programs, with the exception of those working in the AdvancingCities initiative, will be mainly impacted.

Techstars' CEO Maëlle Gavet stepped down in May, prompting Cohen's return to the job. In January, the firm decreased its headcount by 7%.

Under Gavet, Techstars focused on increasing its program offerings, which drew criticism from the investment sector. Cohen's email indicated a shift in focus from scaling to increasing support for founders.