Trapeze's Rebalancing Act

Wireless switch startup Trapeze Networks Inc. yesterday laid off eight employees so that it can add more salespeople while keeping to planned headcount limits, Unstrung has learned.

Trapeze's marketing VP, George Prodan described the layoffs as a "rebalancing" of the staffing levels in different departments in the company. Four engineers were laid off, three general and administrative staff, and one marketer, Prodan told Unstrung. [Ed. note: We don't know if the infamous Trapeze "naked guy" is among the departed, he certainly doesn't seem to be on our site anymore. Alas.] Prodan says the numbers will be made up by adding sales staff in China, Europe, and the U.S.

In fact, Prodan says, the company intends to swell its ranks with more sales folk by the end of the year: "We have a plan now, as sales revenues increase, to add to the sales force."

Even after the layoffs, Trapeze retains around 110 employees, more than double the headcount of many of its startup rivals like Airespace Inc. and Aruba Wireless Networks.

Many industry watchers have wondered how long Trapeze can maintain such a high burn rate, even taking into account the large cash infusions the company has received from the VC community (see Trapeze Swings $34M). But Prodan says the company is moving ahead as per schedule. "All of our plans remain the same -- we are targeting profitability for December of 2004."

Trapeze has been shipping product since July. Prodan says there now 102 of its Mobility Exchange switches and 670 of its Mobility Point access points "in the field." (See Trapeze's High Wireless Act.)

However, Prodan -- who once predicted that Trapeze had a year in which to make good -- admits that it is perhaps taking a little longer than the company originally expected to sell wireless LAN to large enterprise accounts.

"The large corporations are taking a little bit more time to test wireless LAN," says Prodan.

Prodan says that Trapeze had initially predicted a four- to six-month sales cycle to sell its boxes into Fortune 100 and 500 accounts. "We're right on the five-and-a-half months border in terms of making that happen," he says.

Trapeze is not the only large, well funded switch startup to announce layoffs recently: Vivato Inc., which scored a $44.5 million funding round in June, cut staff in August in order to bring more salespeople on board (see Vivato: Shaken & Stirred Up )

It’s a trend that could well continue, as the startups in this sector get their products off the drawing board and into a marketplace where they will face growing competition from incumbent vendors (see WLAN Switch Shakeout Looms?).

— Dan Jones, Senior Editor, Unstrung

Postscript: Apparently the naked guy (a.k.a. "Flyer Bob," it seems) is still with Trapeze, although our sources say he may soon be sent for a mandatory session at the local tanning booth.