A tech company that claimed to “democratise creativity” by matching artists with design briefs for major brands is on the brink of collapse after being issued with a winding-up petition over unpaid debts.
Talenthouse, whose clients have included Netflix, Coca-Cola, Nike and the UN, is facing legal action by creditors in the UK and is understood to have laid off most of its workforce, with top executives also departing its parent company in recent days.
Its parent company, Talenthouse AG, has also announced the closure of four other subsidiaries saying they cannot afford to pay outstanding bills, including staff wages.
The news follows months of financial turbulence. In February, the Observer reported how contributors to the Talenthouse digital platform had not been paid thousands of pounds for projects completed months earlier. Some had worked on high-profile briefs, including designing posters, ad campaigns and social media posts for clients such as DreamWorks, Nationwide and Snapchat. At the time, Talenthouse co-founder Roman Scharf apologised and said the firm was “working on a long-term robust solution” that would benefit creatives and be announced soon.
But two months on, parent company Talenthouse AG has announced a major “restructuring” including the closure of the UK entity through which many of the artists were contracted.
Talenthouse AG, which is listed on the SIX Swiss stock exchange, said a “strategic review” had revealed “substantial outstanding liabilities” at the subsidiaries including salary and tax payments that could not be covered. “The company has decided to fund these entities no longer,” it said in a statement for investors on 21 March.
The news leaves many Talenthouse suppliers, contributors and staff in financial limbo.
Days before the restructuring was announced, Talenthouse’s UK arm was issued with a winding-up petition by Quantuma, a business advisory firm which is owed money and has applied to the courts to close the company down.
If successful, it could lead to Talenthouse’s UK assets being sold and any money generated paid to those who are owed. But there is no guarantee that creditors will get their money back quickly, if at all.
For Robert Acle, 47, an artist from the Philippines who says he is owed more than £3,200 by Talenthouse’s UK entity, it is a huge blow. He has been chasing payment for projects, including a campaign for a social media giant, since last August and said he was “very concerned” he would be left permanently out of pocket. “All I get from Talenthouse is, ‘We’re doing what we can,’ automated responses. No one really seems to care,” he said. “It’s emotionally and mentally draining. I’m just overwhelmed by the most likely possibility that they will get away with it.” Contributors to another subsidiary facing closure, photo platform EyeEm, are also understood to be owed money by Talenthouse, meanwhile employees say they have in some cases faced months-long salary delays.
London-headquartered Talenthouse was founded with a mission of democratising creativity and helping level the playing field for artists internationally. On its corporate page, it implored companies to partner with it because “purpose-driven brands do better”. “Up your integrity. Virtue signalling is not enough. Take action with Talenthouse today and democratise creativity,” it said.
In recent years it has struggled financially, with insiders blaming a series of acquisitions that drained money from the business and a wider tech sector downturn. In recent months, staff across the company have been laid off and almost all key executives have departed.
Those who remain at Talenthouse, including co-founder Scharf, hope that some parts of the business, such as recently-acquired Coolabi, which manages intellectual property for children’s and family brands, will continue via different entities, buoyed by cash from new investors.
However, an insider said the Talenthouse platform, which was central to the business, was unlikely to continue in its current form. “The team is gutted. The management is gutted. The heart of the business is dead,” they said.
Scharf said it was “painful” to see some teams go but that Talenthouse AG was “actively working” on steps to save other parts of the business. “We are looking to safeguard as much of the business of the group as possible in these challenging times,” he said. When asked what steps were being taken to ensure contributors and staff were paid, he did not respond.Quantuma, which initiated the legal action against Talenthouse Limited in the UK, declined to comment.
