Startup accelerator Techstars is cutting its workforce by 17% and killing off its $80 million JP Morgan-backed Advancing Cities programme.
Launched in 2022, Advancing Cities was designed to invest in more than 400 companies led by Black, Hispanic and Latino, Indigenous American and Pacific Islander entrepreneurs across nine US cities, including Oakland, New York and Miami.
However, the programme will not continue once JP Morgan's sponsorship finishes at the end of the year.
According to TechCrunch, the bank decided against continuing the programme last year, meaning that Techstars could not start fundraising for a second round.
A JP Morgan spokesperson tells TechCrunch: “The fund is expected to be fully deployed by the end of this year, as planned. JPMorganChase remains committed to supporting across the country through the expansion of its diverse manager network, private investments platform and engagement capabilities."
Earlier this year, TechCrunch reported tensions between the bank and Techstars over issues such as the definition of diversity when it came to backing founders.
Meanwhile, in an email to staffers last week, Techstars CEO David Cohen confirmed the 17% workforce reduction, writing that "it has become clear to me that we overbuilt and over hired to support our ambition to scale".
The reductions come predominantly from engineering, portfolio services, and sales and partnerships. Accelerator teams will be largely unaffected - apart from Advancing Cities, which is reported to account for about 20 people.