Jonathan Kessler, CEO of “Uber for trucking” startup Cargomatic is stepping out of the role, the company confirmed to DC Velocity, which first reported the news.
Kessler is moving to Chief Product Officer for the company while staying on its board. There’s no word on a replacement CEO yet.
The news of Kessler’s transition comes after the startup “blindsided” its employees by laying off approximately 50% of its staff in April.
Its hiring spree had come to a dead stop in early 2016, a source told Business Insider’s Lara O’Reilly, who first reported the layoffs.
“I think everyone had a sense that something was amiss when management implemented a sudden hiring freeze with no explanation. But no one could have expected something of this magnitude. Everyone that was laid off was given no warning whatsoever. They were completely blindsided,” the source told Business Insider at the time.
Kessler had cofounded Cargomatic alongside president Brett Parker in 2013 with the hope of tackling a broken trucking industry. It matches trucks with spare space with people who need items transported, an area of trucking logistics that’s caught the eye of many venture capitalists.
The company has raised more than $10 million in venture funding. Its last round came in January 2015 when Cargomatic announced an $8 million Series A funding round led by Canaan Partners, with participation from Volvo Group Venture Capital, Sherpa Ventures, SV Angel, Scott Banister, and others.
News of the layoffs and Kessler’s transition comes at a time when many startups are starting to cut costs, which often means employees. However, Cargomatic also brought on two experienced industry veterans, including one from UPS, to lead its sales department.
“It is common in the maturation of a fast-growth technology company to have the visionary founder move out of an operations role,” cofounder and president Parker told DC Velocity. “The change does not affect our continued expansion and our prospects have never been more positive.”
Kessler later confirmed the move to Business Insider.
“Cargomatic has been an amazing labor of love for me over the past 3 years. As a serial entrepreneur, it’s time for me to hand over the reigns to others. I will continue my involvement with Cargomatic as a Board Director and consulting as the Chief Product Officer. Lots of exciting things happening with the company. I see a bright future for it,” Kessler wrote in an e-mailed statement.