Inside Pollen’s Collapse: “$200M Raised” but Staff Unpaid - Exclusive
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Pollen was an events and festival tech startup. Founded in 2014, the company raised more than $200M in venture capital. It was headquartered in the UK, with a significant presence in the US and Poland. The company organized unique “event experiences” featuring superstars such as Justin Bieber.
Pollen seemed to have pulled off the improbable feat of building a business in the notoriously low margin industry of events, surviving Covid-19, and building a solid software engineering organization. In April this year, the company announced it had raised another $150M in fresh funding.
But just three weeks later, Pollen laid off about 200 people, a third of staff. Leadership assured employees all was well. However, from that point on, things got worse. Leadership later pulled the plug on Slack, employees were not paid wages, pension contributions went missing, and vendors were not paid. Some vendors took matters into their own hands; on 9 August 2022, JIRA was suspended when Atlassian tired of the company’s failure to pay.
On 10 August 2022, Pollen went bankrupt, collapsing into administration.
In this issue, we cover:
- First impressions. Why were techies formerly working at the likes of Twitter, Deliveroo and Monzo attracted to Pollen?
- Early warning signs. What were the red flags people ignored early on and now wish they’d heeded?
- Growing signs of trouble. A detailed timeline of events from late 2021 to May 2022.
- Layoffs and more trouble brewing. The events of May 2022.
- The $3.2M not-yet-due charging of customers. 21 - 22 May 2022 and the following weeks.
- Collapse. June - August 2022.
- Afterlife. How is Pollen still operating, despite being bankrupt?
- Learnings. What is there to learn from events at Pollen? How could employees exit ‘the next Pollen’ in time, and what can founders learn from Pollen’s demise?
- Appendix: Pollen’s history: a brief overview. A summary of the story of how Pollen, as a company, came about.
This article walks through the collapse of Pollen, compiled after talking with 20 now-former employees. The majority of people I talked with worked in technology. This article tries to answer the question, could these tech workers have realized sooner they were on a sinking ship?
As I’ve dug into what happened, I uncovered increasingly unusual details:
- Decent European investors investing more than $200M into the company over six years, and delegating partners to join the company’s board of directors.
- Unknown to most employees, all external investors quietly resigning from their seats on the board of directors.
- A partner at Kindred Capital referring to themselves as a current board member at a company-wide town hall, when documents show that the previous day they resigned from their board seat.
- Collecting $3.2M in payment plan instalments from thousands of customers that were not yet due, but no postmortem published or reviewed internally.
- Shutting down Slack for the whole company after US employees took to the channel to complain about not being paid.
Why do I cover this story in such detail? I’m doing this because Pollen did something I know of no other company doing so in the past several years. After raising more than $200M in venture capital and hiring world-class tech talent - from people who previously worked at the likes of Twitter, Deliveroo, Monzo, Apple - they then failed to pay wages.
While we’ve seen other VC-funded companies go bankrupt before, the vast majority of those bankruptcies were ‘clean’ in the sense that employees were paid severance, vendors got paid, and any remaining money was returned to investors. This is how Fast shut down one year after raising $100M – as covered in Inside Fast’s rapid collapse – or how Airlift, once the largest startup in Pakistan, closed its doors, as covered in The Scoop #18.
In the case of Airlift, the leadership team decided to shut down operations as soon as they would have risked payroll, if they keep operating, according to an internal slide.
I am showcasing the story of how Pollen ended up unable to pay wages, in hopes of sharing lessons for employees to avoid similar situations.
1. First impressions
In the London and Warsaw tech scene, Pollen built up a reputation as a fast-moving tech company which placed lots of emphasis on diversity. Its engineering team was diverse – not the least because Pollen partnered with agencies to hire a diverse workforce.
I asked software engineers why they decided to join the company between 2018 and 2021. Here’s what they said.
- Remote work, flexible working hours, even pre-Covid-19. Pollen set itself up to support remote work at a time when many companies didn’t. I talked with a software engineer who joined mainly for this reason, because their previous employer insisted upon working from the office.
- A career path. When interviewing candidates in 2020-21, Pollen managers shared how career progress was possible and that promotions were pretty common. Again, this was a selling point for some software engineers I talked with.
- A “hot” company, raising a new round every year. The company raised fresh funding in 2016 (Seed,) 2017 (Series A,) 2018 (Series B,) and in 2020 (Series C); in ever-growing amounts and valuations. These new rounds always generated positive media coverage in publications covering the European tech market.
- Salary transparency, implemented. Pollen paid everyone in the same role, exactly the same amount. Employees had access to a report on who made how much.
- Good compensation and unlimited vacation. In the UK, software engineers were paid close to the top of market base salaries, plus a healthy amount of stock options. People received unlimited holiday – with the guidance to use at least 25 days per year in the UK, in line with the statutory minimum requirements.
- Strong engineering talent. The company hired software engineers and engineering managers (EM) from Monzo, Twitter, Deliveroo and other companies with a strong engineering culture.
- Long tenures in tech. It wasn’t unusual for software engineers to stay for 4+ years. Some of the “core” team who built the early versions of the products were still around at the end.
- High Glassdoor rating. For years, the company was rated at 4.8, with many positive comments.
From the outside, Pollen looked like a fast-growing VC-funded startup with a healthy engineering culture. It should be of little surprise that the company attracted tech employees who previously worked at the likes of Apple, Twitter, Deliveroo or Monzo. When these tech employees joined, they were not disappointed.
Engineering managers liked working at Pollen. The engineering managers I talked with all shared that they felt part of a supportive engineering management community. As with any startup, there were times when people worked beyond their “normal” hours. However, managers tried their best to make sure this rarely, if ever, happened.
Diverse hiring a strong focus within engineering. The company had several leaders from underrepresented groups and at its peak, Pollen’s engineering team was 35% women. Pollen partnered with Druthers Search, a specialist search firm which helped source more diverse candidates and introduced many of the leadership team across engineering, product and design. I talked with several engineering managers from diverse backgrounds who felt supported. After Pollen went bankrupt, several of them contacted Druthers to find alternative positions at inclusive companies.
It should be applauded that Pollen cared enough to use a specialist agency to help build a diverse leadership team. However, at the time of publication, Pollen has not paid any of the invoices sent by Druthers (a boutique, women-owned business) since October 2021.
Salary transparency. The company was radically transparent about pay, sharing not only pay ranges, but also the ranges of shares. I reviewed the compensation ranges and my assessment is Pollen offered what I would classify as Tier 2 compensation packages.
“Freedom and ownership.” This value was a core pillar of company culture and resonated especially well with engineers. It meant extreme flexibility about managing your own time and achieving outcomes in the way you wanted. As such, people were expected to take ownership of outcomes. Hours were flexible, and people could work from anywhere, anytime, and take breaks as they saw fit. While the company had a few offices, most people worked fully remote. As a former engineering manager shared:
“It felt like people were treated like adults, with plenty of trust and respect.”
“Mastery.” Another value the company practiced was “mastery.” This is the development of every employee via quarterly workshops with managers. In these workshops, staff explored what gave them energy, identified areas for development, and helped craft a development path.
Pollen did not do performance reviews within the technology teams. Managers I talked with found this liberating, compared to previous roles. An engineering manager shared how they noticed that in this setup, underperformance went undetected for longer, and promotions were less consistent. Outside of the tech teams, Pollen conducted performance reviews during what was called ‘mastery sessions.’
The company allocated a personal mastery budget of £750/year in the UK. People could use this budget for anything that helped them stay at “peak performance.” People most frequently used it for things like books and trainings. Some people expensed wellbeing activities like therapy, gym memberships or subscriptions to mental health apps.
The main product was successful until late 2021. Pollen grew massively throughout 2020-2021, during the pandemic. This was thanks to putting together unique events which were curated directly with performers. Events were memorable for attendees and Pollen had no problems selling out tickets – except when it started to have trouble processing refunds around 2021 and ticket sales dropped as customers became more cautious.
Most engineers and EMs really liked working at Pollen. The people I talked with told me they found the workplace to be good. It was the events in the final months that soured everyone’s experience.
2. Early warning signs
I asked people in engineering what signs they wish they would have taken action on, sooner. They shared a few things.
“Party culture.” Even when interviewing, it was clear to candidates the company was big on partying. At the same time, there was much less focus on things important to many people, like good health insurance and a solid pension setup.The company really did “go large” with company-wide events. Here’s a video of the 2018 company-wide party when they rented out Osea Island in England, and a summary below of a 2019 company-wide party in California:
Little data shared with employees about the financial position of the company. Employees I talked with told me they felt in the dark about the financial situation of the company. Even engineering managers had no idea how much money the company had left, what the burn rate was, and how much runway was left.
The company did post booking numbers, revenue projections and performance indicators like fill rate on their public Slack channels, and had set up internally public Looker dashboards which everyone had access to. Employees could also query databases to find out additional information.
The Pollen Press team responded in a comment, claiming that it is extremely unusual for growth stage companies to share their cash balance and cash flow forecasts. They added how the burn rate is complicated because of the seasonality of the business. In a transparency document shared once per month, the company told employees that they would not share their cash and balance sheet.
The warning sign of not having information about financial data or how much runway the company has left was how Fast operated, which raised $100M but went bankrupt less than a year later. From the article Inside the rapid collapse of Fast:
“Ask if there is a clear set of key business metrics, and if engineers have access to these in close to real-time. Is it the number of users? Revenue? Signups? Percentage of returning daily users?
If the answer is “no” to either of the questions, treat it as a red flag. In the case of Fast, these metrics were likely not defined, and the data was not shared with all engineers.”
Refunds not paid on time as a recurring topic. Pollen employees were aware that customers regularly complained about unprocessed refunds. A disgruntled customer started a petition in February 2022 which gathered comments from hundreds of people. These people claimed they did not get refunds for canceled events within 90 days. In this petition, several customers claimed to have waited more than 5 months for their money to be returned.
On 16th June 2022 the CEO would tell employees that the amount of refunds that could be processed is limited to a certain budget, due to investors capping how much can be spent on refunds.
Some vendors not being paid. During fall 2021, engineering managers started to realize Pollen had stopped paying at least one vendor. Diversity and inclusion recruitment tech firm Druthers Search was not paid from October 2021. An engineering manager placed by this firm told me how they were concerned about the delay of these payments.
The Pollen Press team responded to my comment asking them if it was true they stopped paying some vendors in the fall of 2021, claiming this statement is incorrect and they have not stopped paying vendors from the fall of 2021. However, I have verified with Druthers Search that the statement is, indeed correct, and that as a vendor, Pollen has not paid them from the fall of 2021, despite repeated follow-ups.
From the spring of 2022, more vendors would not be paid. I talked with another vendor which had payment delays in the beginning of 2022 and none of their invoices would be paid from March 2022.
An unusual Series C fundraising announcement in April 2022. Pollen announced it had raised $150M in its Series C. Compared to most fundraising announcements, several things were unusual about this announcement: no lead investor was listed, and it was not clear what investors participated in the round.
Comparing Pollen’s Series C press release to their Series B one shows the differences. For the Series B, they named the lead investor, the participating investors and specified which existing investors participated.
In company documents released later in the year, it was revealed that only £0.9M ($1M) in new equity was released in 2022 from investors. Five out of the six investors Pollen listed on their Series C announcement would leave the board of the company a month later, by 30 May.
In a statement, the Pollen Press team claimed that there was nothing unusual about their press release:
“The first close of the funding round was in December,  the second close was at the end of March 2022. The $150m included the conversion of two separate convertible notes raised throughout the previous 18 months to help fund the business through covid, the balance was venture debt.”
In the press release of the raise, nowhere was it noted that the $150M included convertible notes raised in the past 18 months.
Despite the warning signs, there were plenty of signs showing that all was well. Looking back, employees I talked with wished they would have started looking for a new job earlier. However, there were signs showing that it was business as usual:
- Hiring people up to the very last minute. At the very last Tech All Hands at the end of June, there were new starters, and a software engineer was to start a week later.
- Plans about the future. At the end of June, when the last few Town Halls and Tech All Hands were held, leadership sounded optimistic about the future, and made it seem that it’s business as usual. At the very last town hall on 28 June, the Chief Revenue Officer would close by sharing how the company is working on concepts with Kanye West that they think could really work well.
3. Growing signs of trouble
We’ll go through the timeline of events as experienced by employees, which is reconstructed from internal and external documents, and from my conversations with ex-employees. In some cases, I share events unknown to employees when they happened.
The fall of 2021, a hiring spree. Pollen hired close to 50 people across tech, growing tech headcount by 50%. By the end of last year, Pollen’s tech org was around 150 people, up from about 100 in mid-2021. Of the tech people, about half were software engineers.
Engineering leadership emphasized the importance of hiring during this time, asking engineering managers and directors to spend at least 50% of their time on recruitment. The hiring spree was extended to all tech staff, who were given training and expected to do at least one technical or cultural interview per week for a few months. It was expected that the hiring spree would continue into 2022.
Dec 2021 – raising the next funding round. The CEO mentioned they were raising a new investment round.
Feb 2022 – Unknown to workers, Pollen stops paying UK pension contributions. For the next several months, pension contributions deducted from employee paychecks were not deposited into employees’ pension accounts. They discovered this en masse in May and complained loudly. After May, contributions up to March would be paid for all employees.
Feb 2022 – a hiring freeze. A sudden change to hiring plans. Managers were told the majority of open roles were closed, effective immediately. Any new role needed approval by the CTO and the Chief of Staff. Backfilling also required justification.
Some engineering managers raised concerns about the financial health of the company. The response from the leadership was that the company was preserving cash and being more cautious with growth.
March 2022 – business as usual. Hiring was slow, but it was business as usual. Every now and then, the CEO posted a short update on his channel #UpdatesFromCallum on how he was putting together a new round of funding, which was going well.
21 April 2022 – a $150M Series C. Pollen announced a Series C investment of $150M. Leadership told employees the finance team had been slow with expense reimbursements because of closing the latest deal and that the delays would be resolved.
Late Apr 2022 – Q1 targets missed. The CTO posted an update over email, informing employees that the company had missed Q1 targets. His message was clear: the new focus was revenue and teams were to review their OKRs and adjust with this in mind.
29 Apr – contractors cut. The CTO informed all EMs through VPEs and Directors that contracts needed to be terminated immediately. EMs were told to make immediate plans for offboarding and handovers. This was no small ask, as contractors comprised more than half of some tech teams.
Unknown to employees, Pollen had not been paying some of its contracting partners by this point. Three months later, on 5 Aug 2022, the biggest contracting company, 101 Ways, would issue a petition to wind up Pollen because of debts it owed, as reported by The Telegraph.
4. Layoffs and more trouble brewing
4 May – unknown to employees, two investors resigned from the board of directors. Northzone partners Pär-Jörgen Pärson and Molten Ventures partner Nicola Mcclafferty resigned from their external director positions. Pär-Jörgen Pärson was a non-executive director from October 2019, when Northzone led a €69.5M investment round in Pollen. Nicola Mcclafferty had been around since August 2017, when Molten Ventures led the $18.5M Series A of Pollen.
10 May – layoffs at Pollen. About 200 people – close to 30% of staff – were laid off. The tech function was much less affected, with 5 people let go, 3 of them frontend engineers.
12 May – 6 June. The CEO, CTO and most of the leadership team disappeared, according to employees, and weren’t seen in-person at any of the events, and responded via Slack and email only.
On 12th May, the CTO posted a pre-recorded video about the layoffs and him being absent. According to one employee, the gist of this video was: “Sorry that layoffs are happening and things are messy, but I had a holiday booked a long time ago and I need to go.”
13 May – pensions discovered missing. In May, several employees started to notice there were gaps in their UK pension contributions. Most people realized contributions hadn’t been paid since January 2022. Pollen, despite deducting 3% from salaries, did not deposit the employee portion into the pension contributions.
Messages swamped the #askthefinanceteam channel. Over the next two months, the company paid the contributions for January, February and March for all staff, according to a statement from Pollen. However, contributions for April onwards went permanently missing for some employees, despite this money being taken from pay slips. Questions only stopped when Slack was shut off for all staff in July.
The Pollen Press team, in responding to this claim, confirmed that the company was not able to make some of the pension payments from Q2 2022, claiming “there was a minority group of employees who didn’t get their pension contributions in Q2.”
17 May – the first town hall following layoffs; almost all the leadership is absent. The only leadership folks present were the President and the COO. The CEO, Chief Marketing Officer, Chief Revenue Officer, and Chief People officer were all absent. In a later town hall, the leadership team would share that they all attended the wedding of one of the cofounders, which event was planned well in advance.
18 May – UK when salaries to be paid a few days later. The Chief People Officer informed employees in the UK via email that their salary would be paid on the last working day of the month. Up to this change, UK salaries would be paid on the 27th of the month.
18 May – the CFO fired. The CEO posts on his Slack channel:
“I’m writing to let you know that I have let Mark Kallick go. JJ and Jam will be co-managing finance in the interim and Richard (our new VP of accounting) will report to both of them. We also hired a satellite CFO team to support our internal finance team until we find a new CFO.”
18 May – unknown to employees, two more investors resign from the board of directors. Leila Rastegar Zegna – a board member via the Kindred Capital investment – and Remo Gerber both resign from their non-executive director roles. Employees were not told, just like they were not told when other directors resigned on 4 May. This left only two external investors on the board, partners from Backed VC and Sienna Capital.
19 May: former board member holds a Q&A for employees. At a company-wide town hall, Leila Rastegar Zegna – partner at Kindred Capital and one of the first investors at Pollen – spent an hour answering questions.
She talked about the business environment, praised the culture that Pollen built and went on to say she expected Pollen to be a company that could survive future system shocks. She described the challenge for Pollen as a “such a phenomenal business (...) but the obvious challenge is operating in a backdrop of huge uncertainty and in the macroeconomic backdrop of funding and liquidity.”
During the Q&A, she talked about the importance of the board, saying it represented accountability and mutual respect. She said the role of the board included holding up a mirror to company management on the accountability side, and that the board represented pushing for decisions in the interests of all stakeholders.
At the beginning of the Q&A session, she was introduced someone involved with Pollen since 2016 "as an investor and board member". Later, she was asked: "explain your other role, which is around as a board member."
She referred to herself as a board member and investor during the town hall. Unknown to employees, she had resigned as a board member the day before and was no longer a non-executive director. This information wasn’t shared with the audience.
I reached out to Leila Rastegar Zegna and to Kindred Capital for comment, five days before publishing this article and received no response. I will update this article when I do. Update: one month after publishing, no response still.
By 22 May: Kindred Capital removed Pollen from its home page. One 19 May 2022, Leila Rastegar Zegna closed her Q&A by saying: “an incredible bright light is in this company [Pollen]. And we [at Kindred Capital] all look forward to being a part of helping it shine.”
3 days later, the company would disappear from the landing page of her firm, Kindred Capital. This is the space where all the notable investments and their founders are displayed. The company was removed sometime between 19 April and 22 May, according to The Wayback Machine archives.
Why did the company remove Pollen, if just a few days ago, their partner praised the company and its employees? I reached out to Kindred Capital for comment, five days before publishing this article and received no response. I will update this article when I do. Update: one month after publishing, no response still.
19 May – tech employees asked to express how they feel. On the Tech All Hands with about 70 people attending, people are asked to share how they feel, using words. The result:
19 May – The Pragmatic Engineer Article: In an exclusive report, I reported on how the layoffs were executed at Pollen in The Scoop #11.
5. The $3.2M not-yet-due charging of customers
On Sunday, 22 May at 4:53am UK time, a Pollen employee working in finance alerted the engineering team about something very wrong. They wrote:
“$3.2m in charges have succeeded in Stripe for installments not yet due. 16k bookings are affected so far and has been continuous all day. Is anyone able to cut off payments or see if this is a manual trigger by someone in Stripe?”
The CTO was the first to respond, four hours later. He confirmed that all charges were sent to Stripe from the platform that there’s nothing for engineering to do:
“Either way nothing more for engineering to do right now as it’s happened - at this point it’s about damage control with comms and refunds.”
What happened? Tens of thousands of Pollen customers have advance payment plans, for example, instead of paying $2,000 for a ticket in one go, Pollen would charge $200 for 10 months. On 21 May, Pollen placed advanced charges for 16,000 payments not due for a few more months, collecting a total of $3.2M earlier then when that money would have been due.
Most customers were charged two additional monthly payments - ones for June and July - Pollen collecting payments for months not yet due. Customers signed up to a payment plan to have a certain amount taken out each month, now they were charged three times the scheduled payments. Customers were pushed into overdraft and complained how they got no response from Pollen.
Pollen not only charged people whose payments were due, but placed two additional charges for at least one person who had already paid off all of their tickets.
Pollen had a standard incident response process which the engineering team strictly followed. According to a former engineering manager at the company, this is how the process worked - most of which is in-line with incident review and post mortem articles covered in an earlier article:
- An incident channel was created
- For high impact incidents, experienced members of the teams whose service was impacted would typically be notified and added to the channel, asked to investigate.
- An incident commander would usually be appointed.
- A postmortem would be started, typically in a few days.
- On an upcoming bi-weekly incident review, the postmortem would be presented, even if the incident was not fully mitigated yet.
This engineering manager told me that the process was so strict that their team would do a postmortem even for something that looked like an incident but then it was deemed a minor issue. During their tenure this engineering manager had not heard any incident not going to the incident review for the reason of it not being mitigated. This was especially true for high impact outages, which would be brought to the next incident review, so people could learn from them.
Asked about what was the longest delay between a high-impact incident, and that incident going to the incident review, another engineering manager shared that during their tenure, this was not more than one month.
For incidents not yet mitigated, the postmortems would have an action list for things to do in order to fully mitigate the incident. The incident review was a place where those present could also add more suggestions.
The not-yet-due charging incident was not discussed on any of the following biweekly incident reviews. While there was an incident commander and a postmortem was started, this postmortem was neither brought to the next biweekly incident review, nor to the following reviews.
Speaking with the incident commander, this person shared that a postomortem investigation was underway and would have been brought to the biweekly incident review upon resolution and documentation completion. They said that the incident was not fully mitigated by 10 August, when the company went into administration - or about 10 weeks after the incident occurred. The person responded saying it would be a breach of their employment contract with Pollen to discuss specific details of any postmortem investigation.
Responding to comment, Pollen’s Press team wrote that the post-mortem was delayed to allow for remaining refunds - like customers who opted for vouchers - to be handed over to support. They claimed that after this being handed over to support is when Tech could have extracted the maximum amount of learnings from the process. Pollen’s Press team said this decision was taken by the engineering leadership team, but without input from the CTO.
Pollen told customers that Stripe was the one incorrectly processing not-yet-due charges. The company decided on this message for customer support agents to use when informing customers of the incident:
“We’re aware that our payment provider incorrectly processed an early payment plan instalment that was due at a later time. We are sorry and offer our sincerest apologies for any convenience caused. A refund can be processed, to return the extra charges back into your bank account, which will take a maximum of 30 days. Alternatively, we can offer you $100 of credit which you can use to upgrade your experience.”
Internally, the first assessment indicated that Pollen’s platform was initiating the charges. This was confirmed by the CTO himself on 22 May, in a Slack message on the #inc-2022-05-22-stripe-payments-have-been-taken-for-not-yet-due-installments channel, in his response to the incident being discovered by a finance employee. Upon learning about the 16,000 Stripe payments being processed, the CTO wrote:
“Looking at RabbitMQ, the queue is empty, so I think any charges we’re seeing have already been sent (i.e. Stripe is churning through them). That means we won’t be sending more charges from the platform.”
I reached out to Stripe to confirm whether the company was, indeed, at fault for incorrectly initiating the charges, as Pollen claimed they were. Stripe said that they don't share information about their users.
On 6 June 2022, the CTO promised an investigation and the CEO said all customers were already refunded. At the tech All-Hands, the question was asked: What caused the payment collection issue the weekend of May 21-22, and what can tech to ensure this doesn’t happen again? The CTO replied saying that refunds have not all been done yet:
“The incident isn’t fully resolved yet. We did try to use a script over the weekend [4-5 June] to propagate the refunds and automate them, but there was some issue with it, so we’re not fully out of the weeds yet. When that script is run and the incident is resolved, we’ll run a full incident review as per our normal process to make sure it’s documented.
Unlike in a normal incident, Callum, The Chief Operating Officer and others have been in continuous communication. More to come directly from me once the incident review gets going.”
The CEO jumped in, and said that all customers who have opted for the refund, have already been refunded, and those who requested the credit, have received the credit already.
On 16th June 2022, the CEO confirmed again that all customers were refunded. During the town hall, an employee asked:
“There are some concerns that we recently deliberately took early payments from thousands of customers, especially since the payment was taken manually. Can you explain, in detail, how this mistake occurred?”
The CEO responded:
“In terms of explaining: it’s being investigated. We’ve committed that once that investigation is done, it will be shared with the company so people understand what happened.”
The CEO closed by saying they will come back with details on what happened. Details did not come later.
Responding to comment, the Pollen Press team wrote that although the post-mortem was initially a big focus, given the environment around Pollen materially worsened, attention was put into more pressing matters.
The $3.2M was about as much money as what was needed for the upcoming May payroll. I revived Pollen's transparent salaries table, and calculated that monthly payroll expenses in July 2022 would have been around $3.0-3.6M/month. The next payroll date was coming up on 31 May in the UK and 1 June in the US.
This number would be further confirmed by the administrator, as Pollen would end up not paying wages for June and a few days in August, owing employees a total of £3.16M ($3.6M) in wages.
May was the penultimate month that Pollen would pay salaries. Was it a coincidence that the company charged customers a similar amount as it would need for payroll, only a few days before payroll was due?
30 May: unknown to employees, the penultimate investor resigned from the board of directors. Andre De Haes, partner at Backed resigned, leaving only one investor, Sienna Capital, on the board in Denis Blank, alongside co-founders Callum and Liam Negus-Fancey, and President, James Ellis.
1 June – Sifted Article: Sifted broke news on how Pollen owes thousands of its customers in this article.
6 June – The CEO shares plans to break even by 2023. The CEO attended a Tech All Hands and took questions. Answering the question on what is Pollen’s burn rate and how long the company is safe, the CEO said:
“The idea is to take the business towards profitability as a result of the funding we just took in.
With this business, when you think about burn, it’s more complicated than other businesses. There’s obviously a seasonality and revenue can be lumpy. From a net cash perspective, we would expect our cash to rise over time through the end of the year.”
He then said how the probability of shocks in the current environment is higher, and how he thinks that Pollen has a strong track record of navigating through those shocks.
He also shared how he expects the company to break even by 2023 on an EBIDTA basis. Originally, this date was 2025, before they made changes to the plan. He projected a net cash burn of around $20M for the next 12 months, on an annualized basis.
Unknown to employees - 15th June: some US employees’ health insurance was terminated. In a letter some employees received months later, US payroll processor TriNet confirmed that they terminated them as clients on June 15, thanks to non-payment from Pollen. Up to that point, Pollen was buying insurance through TriNet from an insurance company. Pollen would deposit money with TriNet, and TriNet would pay for payroll and insurance.
16 June: the CEO shares that it is harder to agree on a plan with investors. At a town hall with most of the leadership team present, the CEO apologized for not being visible recently and that he’s not addressed the company until now.
He shared that spend is being signed off by investors, saying:
“I am really fighting with our shareholders, our board and investor base, negotiating fluidly week to week about the plan, what we should spend on, and what we shouldn’t spend on.”
The CEO also makes this statement about investors:
“Pollen is big enough for a lot of our investors that the people that led these deals, and put money into Pollen. If this deal doesn't make them the return that they're expecting, they'll lose their job. And that obviously influences their thinking and it influences the way that they behave.”
He says that while when the markets were doing well, conversations with investors were easy. However, now it’s harder to agree on a plan about how quickly customers are refunded, and things the company should invest in. In the meeting, the CEO said that they agreed to a weekly and monthly budget for refunds with investors. Pollen’s Press team said this budget was a daily one by this time.
Taking a question about missing pension contributions, the Chief People Officer admitted that there was a mistake made: they collected contributions correctly, but did notice for a while that they did not go through correctly. When this mistake was noticed, it was not prioritized correctly. She points to people in the finance function leaving, and then being under pressure to deal with other things. She closed off this topic by saying that have dealt with all the paperwork and “it’s been sorted.”
17 June: CTO reassured EMs about company finances, shared plans for all-tech offsite. The CTO met with EMs and reassured them the company’s financial position was safe and the company had the money to operate. The CTO shared that they planned an “all tech offsite” for three days in October.
Pollen’s Press team confirmed that a contract down-payment for the offsite had already occurred by this point, and was signed by the legal team.
23 June: A tech all hands where things are presented as ‘business as usual’. The CTO hosts a tech all hands where he acknowledges that the past few months have been turbulent, but says that he expects things to stabilize. He says “[Things] will be different to a year ago, but they will be more stable.” He shares that the technology organization will do a reorg to adjust focus and gives an overview of the ‘Sprint Zero’ process that will serve as the basis of this reorg.
At the meeting, he announces that while two people left the organization, two more people have started, and a new starter software engineer joins on 27 June.
I talked with the software engineer who did, indeed join on 27 June. That person did not know at the time: but they would not be paid throughout their tenure at Pollen, before the company would crash into administration on 10 August.
This tech all hands would be the last one that the tech team would have.
28 June: the last town hall. In what would be the last town hall at the company, Pollen’s cofounder and Chief Revenue Officer Liam Negus-Fancey did a short, 25-minute town hall, which was him answering questions from employees, most questions which were about the new strategy of the company.
The closing question was about what the CRO is most excited about for the next 12-18 months. His answer?
“For me it’s exciting when we’re doing big deals with massive talent. We’ve got promising conversations with people like Nicki Minaj. We’ve been working on something with Snoop Dogg for a long time that feels really exciting. We’re working on concepts like Kanye West that we think could really work well.”
On the meeting, the Chief People Officer said that the next town hall will be held the coming Thursday, on 7 July. That town hall would not happen - and neither would any further ones.
30 June: salaries not paid on time, the CEO assuring employees it would never happen again. On the day salaries were supposed to arrive, the Chief People Officer sent a message on Slack to all staff, saying that shareholders are only just releasing the next funding instalment which means payroll is delayed by one day.
The same day, the CEO shared a message on the #UpdatesFromCallum Slack channel:
“I will share a lot more towards the end of the next week about who are new partner is going to be. (...) I am now at the point that everything is agreed with [the Pollen shareholders] and our new partner and so the shareholders are now happy to fund. (...)
I assure you this [pay being late] will never happen again”
Employees would not find out any details about this new partner the following week, or after.
30 June: unknown to employees, the last investor - Sienna Capital resigned from the board of directors. On the message sent on 30 June to all staff, Pollen’s Chief People Officer wrote:
“We are now at the cusp of closing that deal that will replace Sienna [Capital] as our main investor and shareholder.”
However, this very same day, Denis Blank, Chief Investment Officer at Sienna Capital, resigned from the board of directors, leaving the board with no external investors. The only directors left were co-founders Callum and Liam Negus-Fancey, and president James Ellis.
Responding to a comment, the Pollen Press team noted that Denis Blank changed firms at this time, and Sienna Capital was in the process of selecting a replacement for him on the board.
Sienna Capital did not name a new board member and according to The Telegraph, the investment firm would write down their $93m (£79m) stake in Pollen to zero five weeks later.
1 – 4 Jul: June salaries of Europe-based staff paid. Most people got their June salary on 1st July at midnight. For some people, the money arrived the following week. The Chief People Officer claimed that delays were caused by manual errors.
Unknown to employees on 1 Jul, Pollen stopped paying health insurance in the US. Employees discovered this fact in late July. Cue outrage.
7 July: the company Slack shut down after US employees complained about non-payment of salaries. US payroll was on a different schedule from Europe; employees in the US were paid bi-weekly, while those in Europe were paid monthly. On 7th July, paychecks due to US employees didn’t arrive. Employees complained on Slack, requesting updates.
Pollen shut down all of Slack without notice. The Chief People Officer sent an email, saying:
“Pollen has always had an open and transparent culture, which means we share information with all of you that most companies don’t share with their employees.
As you’re aware we are at the final stages of negotiating a transaction with a partner which we have been talking to you about. Sadly, a few employees have been sharing sensitive information with journalists which impacts these negotiations. Therefore we are turning off slack for the next couple of days while we investigate this and find an appropriate solution.”
Slack was not turned back on for most of the company, except the technology teams, who got access about 10 days later.
Chaos ensued, as a result, as Pollen was a remote-first company and Slack was how employees communicated with each other and in groups.
At 4pm UK time, the CTO held a 15-minute meeting with engineering managers. According to individuals with knowledge of it, the CTO said about the Slack situation as, “not ideal, but we can just use WhatsApp or Google Chat for the time being.”
7 July: Pollen confirms they will be able to pay staff in August. Sifted reached out to the company asking if they can pay staff, or at risk of insolvency. The company’s response, as per Sifted:
“Sifted asked Pollen if it will be able to pay staff next month. ‘Yes, absolutely we can,’ the company replied in a statement, calling last week’s payroll ‘mis-timing’ and ‘an isolated, one-off event’. The company also denied it was at risk of insolvency. ‘The company has a supportive and well funded shareholder base,’ Pollen said.”
10 July: Laid-off employees blocked from emailing the company. From this day, the personal emails of numerous former Pollen employees were blacklisted and they couldn’t send emails to any @polle.co email, except when emailing the People team.
Responding to comment, Pollen’s Press team confirmed that some accounts that were identified as spam were restricted in their ability to email addresses outside the Chief People Officer and the People team.
11–16 July: Engineering team told to carry on like everything was fine. Over the course of June, the EM team was preparing to do a reorg; moving teams around to respond to the personnel changes of the May layoffs. The original plan was to spend the week of 11-16 June on ‘Sprint Zero.’ This was to be a series of workshops to re-establish team missions, ways of working, creating roadmaps, and so on.
The EMs advised the CTO to cancel ‘Sprint Zero,’ given the chaos and how Slack was turned off. But the CTO was adamant ‘Sprint Zero’ should go ahead as if all was fine. Grudgingly, the EMs went along. At the start of the week, the CTO joined a call about the kickoff of ‘Sprint Zero’ for 10 minutes, then disappeared for the rest of the week, busy with the negotiations which would determine the fate of the company.
The week was stressful for everyone; doing workshops about how teams would operate in future, while employees were worried if they would see payroll at the end of the month.
10–21 July: updates from the CEO with no real information, except that the deal was ‘in the final stages.’ Below are excerpts of what the CEO, Callum Negus-Fancey, sent to all Pollen staff. All emails were sent as “bcc,” possibly so nobody could hit “reply all” to the whole group.
“I would love to share more with you but given these conversations but given these conversations are sensitive in nature and information is being shared outside the company in a way that wasn’t expected and could be damaging to the negotiations and to Pollen, I am limited in how much I can share now. (...)
I hope to be able to share more on Wednesday [13 July], at the very least will give you another update then.”
“I’m excited to share that in the last few hours we’ve reached the final stages of negotiation with one of the largest entertainment companies in the world. I can’t share who yet till the deal is signed. Please do not share any information with anyone outside of the company as doing this slowed down the negotiations last week. (...)
I will send another update before the end of tomorrow [14 July].”
“As an update - negotiations are moving along very positively and I hope to complete them over the weekend and be able to tell you who our new partner is towards the end of next week. They will bring a huge amount of Pollen and so I am very excited about their involvement and all the strategic value they bring. I look forward to updating you more on Monday [17 July]”
No update came on Monday, 17th July, despite the promise.
“Apologies for the delay in sending an update - we have been busy! There is great momentum and we are still in final stage negotiations but everything is going in the right direction. I hope to be able to announce our new partner at the end of this week or early next week!”
Throughout July: company town halls canceled at the last minute. With Slack closed down, town halls would be the only place for employees to learn what was happening with the supposed deal. So instead, they turned to the media for information, having no other source to get details from.
18 July: Pollen submitted its 2021 annual report. This was the first time employees got a glimpse of Pollen’s true financial position. At least, those who looked up the filing could, but leadership didn’t advertise its publication.
All external investors had resigned before this report was compiled.
It revealed that although the company had announced a $150M Series C funding in April, only about a £0.9M ($1M) in equity has been received up to July. As per the filing:
“In the period since 31 December 2021, the company has completed its Series C funding round, raising an additional £0.9m, received in cash from new and existing shareholders.”
The report showed that in 2021 Pollen made a loss of £51M on revenues of £49M; basically, it cost £2 for the company to generate £1 in revenue. As of 31 December 2021, the company had £13M cash in hand. It was clear the company desperately needed either another large investment, or a very long line of credit to be able to operate throughout 2022.
19 July: Slack turned back on, but only for tech teams. Slack was reinstated, but only for technology teams. The rest of the business would not have access to Slack, not even later.
21 July: CTO confirms July payroll is not at risk. At the first meeting between EMs and the CTO since the delayed June payroll, the CTO said that the July payroll wasn’t at risk, so everyone should stay work focused. He explained that money for payroll came from existing investors, so this money wouldn’t be released until the deal was signed.
Unknown to employees at this point, no investors sat on the board of directors by then, the last having resigned 21 days earlier.
Responding to comment, Pollen’s Press team wrote that the CTO’s comments were based on the information available at the time.
21 July: The Pragmatic Engineer reports that Pollen is on the verge of bankruptcy. In The Scoop #19, I shared my opinions that the most likely outcome for the company is that investors stall and the company goes bankrupt.
21–28 July: no meaningful updates from the C-level. Updates from the CEO contained no information, beyond assurances that a deal was close to being signed. The CTO remained invisible to engineering, save for his one-on-one communication with the VPs and Directors.
28 July: the CTO messaged managers that there was no money for July’s payroll. Managers were upset. From the Slack conversation:
CTO: “Update on the deal etc. - my current best guess is that we will NOT make payroll as planned tomorrow. This is an assumption I’m making given that we’re still talking with the partner. I’m telling you this as it may be prudent to let your teams know privately so they can plan accordingly if they need to. There’ll be another update later tonight once we have more detail. (...)”
29 July: CEO told staff they won’t be paid. From the email:
“You have been incredibly patient and supportive with us over the last months so it pains me to say there will be a delay in payroll until next week to allow the transaction [with the partner] to conclude. (...) I will share a further update on Sunday [31 July]”
That promised update did not come.
1 Aug: most tech employees stopped working. With no salaries paid and with no specific information coming from Pollen, most people started to search for new jobs. There were still people who wanted to stay, who believed in the CTO and CEO and hoped the company would close this mysterious deal. Also on this day, there were no updates from the CEO.
4 Aug: CTO invited tech employees to join him, unpaid, on a ‘special operation.’ The CTO organized a 15-minute all-hands, and shares:
“I remain engaged, I still believe in Pollen. It’s ok if you don’t want to work but those who want to be helpful and contribute to the future, join me on Monday [8 August] for a special operation. We’ll ideate features, form teams and work on those. More details will follow.”
9 Aug: Sky News reported that Pollen was on the brink of collapse. Early afternoon, the outlet ran the story:
“Sky News has learnt that Pollen, which has been scrambling to find a rescue deal for weeks, could crash into administration as soon as Wednesday [10 August]. City sources said that hopes of finding a buyer had faded in recent days.
Pollen, which is backed by the government's Future Fund, has failed to pay staff as it lurched towards disaster. Kroll, the restructuring firm, has been lined up to oversee the prospective insolvency.”
9 Aug: CEO said media reports were incorrect. He sent a one-line email to all staff, on the bcc:
“What you’re reading in the press is full of speculation and inaccuracies. We will be ready to announce what’s happening later today and I will be sharing all the information with you.”
Later in the evening, The Telegraph broke the news that Pollen was to enter administration.
10 Aug: bankruptcy confirmed by the CEO. The CEO sent a long email confirming media reports that the company was entering administration, and apologizing that the media reported on the company shutting down.
It was in this email that employees would learn, for the first time, that investors dropped out from the Series C or reduced commitments. The CEO wrote:
“We raised less money than we planned in our Series C given investors changed the size of their commitments or unexpectedly chose not to invest.”
A few minutes after the CEO’s email, the CTO emailed the engineering team, offering support to help people find a new job, and closed by saying:
“I’m sorry things ended this way. I’ve been building Pollen for 6 years and this was not even remotely the ending I dreamt of, let alone the way which it was ended - especially that the Telegraph article was how some of you learned this information [about entering administration]”.
12 Aug: employees terminated. Most employees receive an email from Chief People Officer, informing them their role was no longer required, with no mention of paying owed wages or severance. Later, follow-up emails would be sent to explain how the administration would work, what it meant for them and support available based on their location.
Following the company’s collapse, how is it possible that Pollen keeps operating at time of publication? After administration on 10 August 2022, the restructuring and insolvency firm Kroll was appointed to oversee the process.
Here’s the situation for Pollen’s employees and vendors, as of publication:
- Most employees are still owed more than a month’s worth of wages.
- Employees in the US were left medically uninsured from 1 July, without knowing about this fact at the time. Some employees have not been insured since 15 June.
- Months’ worth of UK employee pension contributions went missing for employees. Money was deducted from paychecks but never transferred to the pension provider.
- Employees laid off in May were not paid their June salary as part of their notice period, nor the severance they were legally owed.
- The remaining employees laid off in August were not promised or paid any severance by Pollen.
- Vendors of the company are owed large sums: two vendors I contacted confirmed that they are owed more than £100,000 in unpaid invoices each.
Some employees were, in fact, paid their full salaries. Employees outside the US, UK or Poland were employed though global payroll solution Deel - which is a company several startups utilize to hire people around the globe.
Even though the last payment Pollen made to Deel was in May 2022, the employees got their paychecks for June, July and August, thanks to the platform paying them. Those employed by other intermediary companies also got paid after Pollen stopped paying employees in the US, UK and Poland.
Pollen continues to partially operate, despite having gone into administration. This has to do with how it was – is – a web of companies, and only one of these entities – named StreetTeam Software Limited – actually went into administration.
In the appendix, I share a brief history of Pollen, which outlines how several companies came and went, and the several rebrands from The Physical Network, through StreetTeam, then Verve, to what became Pollen. I’ve visualized the corporate history and structure of the UK companies connected to the cofounders of Pollen. Note that the below structure does not include US entities.
Pollen was structured in a way so StreetTeam Software only owned the platform, it did not own the collecting of money from experiences sold. All the revenue from events and experiences went to Justexperiences Limited (also referred to Trippr UK), which operates independently of Pollen (aka StreetTeam Software.) Justexperiences Limited is 75% owned by StreetTeam Software, but the US-based Justtours Inc, is also a minority shareholder.
Thanks to its corporate structure, Pollen is still making some money. Customers are still booking experiences – which may never happen – still using the infrastructure of StreetTeam, and the money lands in Justexperiences’ bank account. This raised some questions with former Pollen employees. During a call with the administrator on 19 August 2022, this exchange took place between a former Pollen (StreetTeam) employee and a representative of the administrator, Knoll:
Pollen employee: “Is it legal that Company A [StreetTeam] employs all the people and pays for all the costs, while all revenue from the services of Company A goes into Company B [Justexperiences]. Company A racks up debts and goes into administration, and Company B walks away with all the profit. That’s possible, right?”
Administrator from Knoll: “Yes. (...) As part of the administrator’s duty is to also look at the director’s conduct. So we do look at all that and all the other entities that they are running as well. We can submit a report to the insolvency service as well.”
On the same call, the administrator shared that they normally ask for one year’s worth of bank statements, but in the case of Pollen, they asked for three years. They are also sending out questionnaires to all directors and all members of the executive team who served during the past three years. The administrator confirmed that it has not been appointed to any US-based companies, and US entities are not part of any insolvent process to its knowledge.
So, what happens next? The administration process will run its course, with Kroll fulfilling its duty of trying to secure as many assets from StreetTeam Software as possible, to redistribute to creditors.
The Pollen Press team confirmed that while Justexpereinces keeps operating, the business is being restructured and the subsidiary businesses are being sold. The Pollen Press team said that it’s important and appropriate for businesses like Justexperiences to remain in operation to retain the most value in teh trade sales.
Several employees reported StreetTeam Software to the UK pensions regulator in May, when they had missed out on pension contributions for more than three months, and more employees are following suit. They hope to reclaim pension contributions deducted from their paychecks.
Regulators and potentially law enforcement will hold Pollen’s leadership team accountable for their roles in a devastating outcome. Employees I talked to feel they were misled to about the financial situation of the company.
Employees who didn’t start searching for new jobs until the very end had one thing in common; they trusted the CEO when he said the company raised $150M funding in April, they trusted the CEO when he assured employees on 30 June that salaries being late would never happen again, and they trusted other messages from leadership.
So, should leadership be allowed to operate a company which company does not have money to pay employees or vendors? According to the UK regulator, the answer is “no.” Any director who does so can be disqualified as a company director:
“You can be banned (‘disqualified’) from being a company director if you don’t meet your legal responsibilities. Anyone can report a company director’s conduct as being ‘unfit’. ‘Unfit conduct’ includes allowing a company to continue trading when it can’t pay its debts.”
The company stopped paying several vendors from March - at least one as early as October 2021 -, was unable to transfer pension contributions for some staff from April, all but one investors departed the board by 30 May, and the last investor - Sienna Capital - departed the board on 30 June. Employees were not paid salaries from July. Now, it will be down to the UK regulator to make a determination if it was reasonable for directors to think that the company will be able to pay its debts.
Pollen confounder and CEO Callum Negus-Fancey has since started a new company. The company was incorporated on 15 September 2022. The name of this new limited company?
Context is Everything.
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I reached out for comment to Pollen before publishing the article, and have included responses where appropriate. Additionally, the Pollen Press team shared how, after a strong 2020 and 2021, the company experienced a steep decline in sales in 2022. They wrote that a combination of three things hit the company at the same time: 1. Being able to raise less investment, 2. Omicron negatively impacted sales in Q1 3. Sales fell in Q2 which the company attributed to increased demand, but customers wanting to book closer to the events. They concluded ‘There were things we could have done better and learnings to be had. However, these failures would not have been existential if it wasn’t for the conditions.’
Full subscribers have access to two additional parts of in the full article:
- Learnings. What is there to learn from the collapse of Pollen? Learnings and advice for employees, and for founders.
- Pollen’s history: a brief overview. A summary of the story of how Pollen, as a company, came about.
Read the full article here. In a future article for full subscribers, I’ll also share details from how Pollen structured compensation, and the pay ranges that made it competitive on the London, Warsaw and US markets. Subscribe here.
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