Last spring, founders from all over the world embarked on their journeys to Techstars’ Stockholm accelerator program. The backdrop was tense: Silicon Valley Bank was facing a bank run, causing anxiety across the startup industry.
SVB Financial, the bank’s parent company, was a significant investor in Techstars. Techstars, like many startups, had a substantial deposit with the bank. Uncertainty loomed over whether those deposits would be lost.
Amidst the crisis, Techstars Stockholm Director Alfredo Jollon posted on LinkedIn that he bought shares in SVB Financial, expressing support for the bank. This move conflicted with VCs advising their portfolio companies to withdraw funds from the bank.
After some resistance, Jollon removed the post under pressure from Techstars CEO Mäelle Gavet, leading to his eventual dismissal. This incident set off two tumultuous weeks for the founders in the program.
Despite the initial chaos, the program continued as planned. However, a week into the program, Jollon was fired, and the founders were sent home temporarily due to a restructuring under Swedish labor law. After public outcry and negative press, the program was reinstated without Jollon.
Following these events, Techstars underwent significant changes under Gavet’s leadership, with several founders and employees describing a challenging environment marked by power struggles and disruptions.
By early 2021, Techstars was in need of a transformation as Gavet took over as CEO. The organization faced strategic challenges and uncertainty about its future direction.
(Gavet pictured above at TechCrunch Europe Disrupt.) Some employees expressed concerns about Gavet’s lack of startup and venture capital experience. Image Credits: Jason Alden/Bloomberg via Getty Images
The addition of new leaders with limited startup and venture capital experience further fueled doubts among employees. Gavet’s ambitious plans for scaling Techstars raised questions about strategy and execution.
Throughout the organization, cost-cutting measures and leadership changes led to a sense of fear and uncertainty among employees. The toxic work culture and high turnover rate painted a troubling picture of the company.
An outsider steps in
Signs of trouble emerged as Techstars faced financial challenges, program closures, layoffs, and a general sense of upheaval. The company’s relationship with corporate partners deteriorated, leading to the termination of several programs.
“I struggle to understand how success can be achieved in a punitive culture of gaslighting, threats, dissension, and dysfunction.” Techstars former employee
By early 2022, the industry saw a shift with the pandemic-era growth receding. Tech giants were downsizing, and the broader venture market faced challenges.
Leadership changes, organizational restructuring, and drastic cost-cutting measures characterized Gavet’s tenure as CEO, leading to internal discontent and a wave of departures among senior executives and managing directors.
Bear market, new leaders
The bear market added further pressure on Techstars, prompting a series of layoffs and program closures. The company struggled to adapt to the changing landscape, with leadership decisions being met with skepticism and criticism.
“They are always looking for ways to shrink their footprint and save money. They are always looking for a reason to cut something, somewhere.” Techstars employee
As Techstars navigated through financial challenges and operational changes, the shift towards a centralized structure under Gavet’s leadership raised concerns among employees and managing directors. Turbulence within the organization intensified, leading to a surge in employee turnover and program disruptions.
