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Mass exodus leaves award-winning startup Zoom.ai with just six employees

Zoom.ai CEO Roy Pereira, centre, is flanked by staff after winning New Startup of the Year at the Canadian Innovation Awards in February 2018 in Toronto Zoom.ai (Instagram)
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More than half of Zoom.ai’s employees, including nearly all its senior leaders, have left the company in the past two months, The Logic has learned.

The mass exodus includes chief technology officer Faisal Abid, who worked at Google and Kobo before joining the Toronto-based firm, which makes a virtual assistant that automates simple office tasks. André de Souza, vice-president of engineering, and Pouria Fewzee, chief data scientist, have also left, according to three sources who were granted anonymity to discuss confidential matters.

Zoom.ai won a series of major tech awards in 2018. The company was named New Startup of the Year at the 2018 Canadian Innovation Awards in February and Most Promising Startup of the Year by the National Angel Capital Organization, an industry association for angel investors, in October.  

While it was winning public accolades, however, the company struggled to retain employees. Ten have resigned since mid-February, including two last Friday. One person was fired. Currently, Zoom.ai has six staff.

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Talking Point

Zoom.ai, a Toronto-based startup that won a series of major tech awards in 2018, has lost 11 employees in the past two months, including nearly all its senior leaders.

Roy Pereira, founder and CEO, said the company is trying to change direction, a process he said can take six months. However, he said, “We have plenty of funding to get us to where we need to be.”

Pereira said the company identified a number of issues in December 2018, including that it had too many bugs, its servers went down too often and its sales focus on very large clients was a mistake because of long sales cycles.

“In January we went out to validate that new direction but by February we realized that new direction wasn’t going to lead us to success,” Pereira wrote in a text message.

“That reality of failure hit some of the team hard and was too big of a disappointment for some,”  said Pereira. “But at that time we started to see some employees express concern and then leave. That caused a domino effect as we had such a close and open culture.”

A source with knowledge of the company described the departures differently, saying, “There was no trust between the leadership team and the CEO.”

Pereira acknowledged the concern around trust, but said most people left because they didn’t feel their positions were useful while the company tried to determine its new direction.

“Obviously change is hard, and it is hard to lose friends at work. Trust in the company and your manager is sometimes damaged during these events,” said Pereira.  

In April 2018, Zoom.ai was selected as one of the top 15 Canadian startups by Metabridge, a nonprofit that runs networking events for tech companies. In July 2018, Zoom.ai was named one of the top 25 up-and-coming Canadian tech firms by Branham Group, an Ottawa-based business management consultancy.

Pereira founded the company in 2016, and has since raised US$5.2 million from investors including the Business Development Bank of Canada, Extreme Venture Partners, Evolution Equity Partners and the MaRS Investment Accelerator Fund. Pereira said his board is aware of the departures, but he has not yet told all his investors.

“When we are ready with our new direction, our investors will be notified,” said Pereira. Extreme Ventures and Evolution Equity Partners—which led funding rounds for Zoom.ai in 2017 and 2018, respectively—did not reply to requests for comment.

Fewzee, the former chief data scientist, resigned five days before the company rolled out an email integration for its virtual assistant bot on February 19. Prior to that the company had focused on automating tasks like scheduling meetings via chat apps like Slack.

Despite recognizing late last year that large-scale clients had long sales cycles, the email integration was meant to attract enterprise customers who don’t currently use chat apps like Slack.

Since then, the company has also lost its head of marketing, Anita Chauhan, and its head of  sales, Paul Vlahov. Zoom.ai was briefly operating with a single sales employee, Juliano Dellamea. He handed in his resignation on Friday, along with Traci Cheng, head of operations and people.

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The company is currently hiring for a senior software developer, a senior front-end developer and a marketing manager. After Cheng resigned, Zoom.ai posted a job for an operations, human resources and office manager.

“As we are doing a large re-evaluation of our target market, we believe that we don’t need to staff up sales at the moment,” said Pereira.

Many of the people who quit their jobs at Zoom.ai did so without other work lined up, according to multiple sources. Several are still listed on the company website, despite their departures.

Some former employees have since found other work. For example, Matas Sriubiskis, who was a growth analyst at Zoom.ai until March, is now a product manager at Ecobee, a Toronto-based smart thermostat company with major backing from Amazon.

Others appear to be founding their own startups. In March, Abid and Fewzee co-founded a company called Dydx, which notifies developers when their APIs break. De Souza is the founder of letsgochamp.ca, which his LinkedIn profile states is “launching soon.”

Pereira has had staff turnover at previous startups. “In my last startup, we had 25% of the team leave six months before we were acquired (for a great ROI for our shareholders),” said Pereira. His company Shiny Ads, an advertisement-technology firm, was acquired in 2014 alongside iSocket, a similar company, for a combined price of less than US$30 million by Los Angeles-based Rubicon Project.

In September 2017, Zoom.ai announced the acquisition of Toronto-based chatbot company SimplyInsight, and brought on co-founders Amanda Parker and Alexey Adamsky to serve as its VP of business development and senior AI scientist, respectively. Adamsky updated his LinkedIn profile with a new title—head of engineering—after de Souza left.

Parker was responsible for managing partnerships, something Pereira described at the time as being key to Zoom.ai’s success. She lasted in the role for seven months, departing in February 2018.

Pereira has made a number of bold predictions for Zoom.ai in recent years. In April 2018, he said, “We want to be like the Salesforce of our generation.” On February 25, he told Techvibes that his company’s expansion to email “really expands what Zoom is,” saying, “I think this is huge.”

But on Saturday, he struck a different tone: “The product-market-fit process can take 6 months to go through. And it needs a different set of people. We believe that we will be through this process by the end of May and will then be going back to market with a proper team.”