Shyp, the four-year-old VC-backed startup that wants to reinvent shipping, is significantly scaling back its operations and laying off employees to “focus on achieving profitability.”
Shyp will offer its service only in San Francisco, and will no longer operate in New York City, Chicago, and Los Angeles, the company said in an email to customers on Thursday. In a blog post announcing the changes, CEO Kevin Gibbon noted that “the market for venture financing has changed and there is now a higher bar for profitability.”
With $62 million in funding from firms like Kleiner Perkins and Sherpa Ventures, Shyp operates with an app that can summon a courier to your front door, pick up whatever you want to mail, package it, and charge a fee to send it on its way for you.
To achieve profitability, Shyp will primarily focus on small business customers and “high volume shippers.” The app already integrates with eBay.
“Knowing what we know now, there’s no question we’d do some things differently,” Gibbon wrote on Thursday. “We would have built profitability in from the beginning. And shifted to serve business customers sooner. In a business that requires significant investment to grow physical operations across multiple cities, we would have focused on achieving success in one market before expanding into others.”
A Shyp spokesperson declined to say how many employees were being laid off and said the company is currently seeking another round of fundraising. “The plan is to scale back, focus on achieving profitability in the San Francisco market, and then build from there,” the spokesperson said.