In a Linkedin post, Christian Reber announces his departure and a tough change in strategy for his startup pitch. He appears affected and exhausted.
In a detailed post on the career platform Linkedin, the serial founder and CEO of Powerpoint rival Pitch announced a blatant step today. Not only is Christian Reber giving up his job as CEO of the startup after six years. Today the Pitch team will also be reduced in size by two thirds. Both decisions followed a change in strategy, writes the pitch founder: They wanted to change from a VC-financed, hyper-growth startup to an organically growing, profitable company. From now on, the current CTO, Adam Renklint, will take over the position of CEO. Nothing changes for customers.
“I need a break”
The past few years have had “many highs, but also some painful lows,” writes Reber. And: “I need a break.” The past year in particular seems to have been hard for Pitch and the founder of the software startup: “As a venture-backed company, 2023 was incredibly demanding.” There were sky-high expectations – but towards the end of the year Years ago, Reber and his co-founder had to realize that they could not fulfill these requirements. “These expectations were simply too high.” So there was a change in strategy from growth to profitability, which several startups had to make last year, including the mobility startup Tier, whose founder Lawrence Leuschner also wrote openly about it on Linkedin. Reber emphasizes that the startup would still have had a runway of four years. “But we were sure that we had a much greater chance of success on the path of sustainable growth.”
The decision has serious consequences for the startup's employees: “We are reducing the size of the pitch team by around two thirds today,” writes the outgoing CEO. According to the company, around 120 people work at Pitch. The layoffs therefore affect around 80 people. “I am very sorry that this had to happen and I take full responsibility for leading Pitch to this point.”
Layoff of a third of the team as early as 2022
In fact, the problems at Pitch were already apparent in 2022. In September, Pitch had to lay off 59 employees, which was around 30 percent of the workforce at the time. From the 2021 annual report it could be concluded that rising personnel costs became a problem for Pitch: from 2020 to 2021, these increased by 62.6 percent to 12.62 million euros. The increase results primarily from “the increase in the average number of employees in 2021 from 51 to 100 as well as corresponding market-based adjustments to salaries”. The main areas in which Pitch had added employees were product, design, engineering as well as marketing and customer success.
Otherwise, according to the 2021 annual report, Pitch seemed to be well on track; even on a growth path. Pitch reported sales growth of 445.7 percent in 2021 compared to the same period last year; in absolute figures, sales revenue amounted to 756,000 euros after 139,000 euros in 2020. Pitch attributes the increase essentially to the increase in paid subscriptions by around 300 percent to over 3,000 customers and a corresponding increase in the user base by more than 440 percent at the end of the year. In order to achieve this strong growth, Pitch made appropriate investments in the expansion of marketing and sales activities in the reporting year. Around this time, people liked to talk about Pitch as a “half unicorn,” with the prospect of achieving unicorn status.
Financed with 120 million euros
Pitch was well financed anyway: Since it was founded in 2018, Reber has raised the equivalent of over 120 million euros (135 million US dollars) for his Berlin startup. The Berlin company achieved a valuation of almost 500 million euros as part of its Series B round worth the equivalent of 70 million euros, in which well-known names such as Hommels-VC Lakestar and Tiger Global invested – and were available to analysts from the tech industry. According to investment bank GP Bullhound, it is already on the verge of becoming a unicorn.
What certainly helped Reber's fundraising was that he has an impressive track record in the startup scene: Together with five friends, Reber founded the startup 6Wunderkinder and led it to a successful exit: Microsoft paid an estimated up to 180 million euros for it in 2015 Company behind the to-do list app Wunderlist.