Atlas Ventures Crash And Burns

I had lunch with a friend of a friend who told me that Atlas, "fired half of their partners."  That seemed like an exaggeration to me, but then some Googling quickly showed that, yes, in fact they had let go both partners as well as junior staff.  If you look at the team section on their site it currently shows 24 people, however, TheFunded lists at least 31 folks.

What makes this so astounding is that Atlas is a 25+ year old fund and their latest fund (fund 7) is ranked as a "top quartile" fund.  Apparently they laid off staff after the fundraising for their 8th fund came in at about half of expectations.  Talk about canary in the coal mine.  If Atlas can't raise money, that means 80% of VC funds can't.

As an aside, something to watch is the "Transitional Zone" on TheFunded.  I was talking to Adeo about this a while ago and this is the "phantom fund" where he stashes VC profiles of folks who leave a real fund.  Instead of deleting the profiles he moves them here until (or if) they pop up somewhere else.  My guess is the "Transitional Zone" is going to see some serious growth in 2009.