Here today we have a flawless specimen of Valley doublespeak: Dalton Caldwell, the founder and CEO of an inscrutable company called App.net, wrote up a "state of the union" for his company. Money is good! But all full-time positions are eliminated. What?
The good news is that the renewal rate was high enough for App.net to be profitable and self-sustaining on a forward basis. Operational and hosting costs are sufficiently covered by revenue for us to feel confident in the continued viability of the service. No one should notice any change in the way the App.net API/service operates. To repeat, App.net will continue to operate normally on an indefinite basis.
The bad news is that the renewal rate was not high enough for us to have sufficient budget for full-time employees. After carefully considering a few different options, we are making the difficult decision to no longer employ any salaried employees, including founders. Dalton and Bryan will continue to be responsible for the operation of App.net, but no longer as employees.
So, the company is "profitable" and "self-sustaining," but lacks the revenue to employ anyone on a full-time basis. Even the two guys who started the company are dropping out. I'm waiting to hear back from Dalton as to what exactly this might mean, but it seems like a really phenomenal contortionist act. Having to downgrade everyone to contract work seems very obviously the behavior of a company that cannot sustain itself.
Next year's memo: our company is doing great, but unfortunately we had to shut down our website and mail this memo to you from a pup tent on Big Sur.