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Promising CMU spinoff laying off most workers
Tuesday, February 13, 2001 By Joyce Gannon, Post-Gazette Staff Writer
The slowdown in the technology sector that's wreaking havoc on dot.com companies here and elsewhere has claimed a promising Shadyside software company.
Clairvoyance Corp., known until about a year ago as Claritech, said it plans to lay off between 40 and 50 employees because of its inability to attract investment capital and clients.
The dozen or so employees expected to remain will continue to work on research and development activities, said Mike Caffrey, chief financial officer of the company that spun out of Carnegie Mellon University in 1992.
The layoffs and restructuring "are mostly due to market conditions," said Caffrey.
"Certainly if the Nasdaq hadn't crashed and there was more technology spending going on, potentially it could have been a different story."
Caffrey said the business is downsizing instead of closing altogether "to wait until market conditions turn around. We still believe we have a very good product."
Clairvoyance develops software that organizes and manages detailed information. It traces its roots to a laboratory project launched in 1988 at CMU for Digital Equipment Corp.
Four years later, David Evans, a CMU professor and founder of the school's Laboratory for Computational Linguistics, co-founded the company with assistance from CMU's Office of Technology Transfer.
During its first several years in business, the company developed custom software for the CIA. Clairvoyance got a major boost in 1996 when a Japanese company, Justsystem Corp., bought a controlling interest in it and asked it to develop custom products for it.
By 1999, the company had several million dollars in annual revenue and was ranked among the 50 fastest-growing high-tech enterprises by the Pittsburgh Technology Council.
Then problems began to set in about a year ago, Caffrey said.
Clairvoyance needed a broader customer base than Justsystem and couldn't find them, he said. The situation was further exacerbated by its inability to attract outside financing.
Caffrey said management plans to give employees targeted for termination 90 days notice during which time they will receive full pay and benefits.
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