Video-sharing startup Color has been a popular punching bag after reports said CEO and co-founder Bill Nguyen was on sabbatical and workers were moving on. So when a report surfaced Wednesday saying the video-sharing company was “winding down” its business, it fueled fresh schadenfreude for the brash startup that came out of the gate last year with $41 million in funding.
But the company isn’t dead yet, said a spokesperson. “Color is not shutting down,” the spokesperson told me.
The report of Color’s closure was first reported by Venturebeat, which cited a company email sent to employees. In it, the company apparently announced to employees that “last week, the Board and major shareholders voted to wind down the company.” But we’ve heard from a couple of people who said that employees there have not received the email. The company is now trying to investigate where the email information may have come from.
Make no mistake, Color is going through a lot of upheavals. Nguyen hasn’t been with the company for about three months, though he continues to retain the title CEO. The size of the staff has fallen from about 50 people earlier in the spring to a staff somewhere in the 30s now. And morale took a hit after Nguyen stepped back from day to day duties, sources have told me.
But the company has a deal with Verizon signed in May to embed its mobile video sharing app on certain Android devices. I’m told that the deal is still in place and Color is working on new product plans. It’s still possible, of course, that Color or its backers could call it quits all the same. But a lack of money probably isn’t the issue. Nguyen said earlier this year that Color had enough money for five or six years.
That’s as a result of Color’s huge $41 million funding last year from Sequoia, which was trumpeted at the same time it launched what was originally a photo sharing app. The app’s failure to catch on with consumers and the cocky promotion-style of Nguyen made Color the startup everyone loved to hate. But does it mean Color is doomed? It might be ultimately if no one can make Color’s pivot toward live video sharing work. And now with more founders stepping back, it doesn’t inspire a lot of confidence. But it sounds like people will have to wait a little more before they break out their favorite Color jokes.