The entire staff of Gogoyoko have stopped working for the online music store and plan to start a new company to compete with their former employer, RÚV reports.
Started in 2007, Gogoyoko was largely funded by two investment groups, NSA Ventures and Frumtak, which wrote-off much the company’s debt in 2008.
Helga Valfells, the Managing Director of NSA Ventures claims that Gogoyoko has been undergoing restructuring and that the staff was laid off at the beginning of this year with the promise of being re-hired.
However, a representative of the Gogoyoko staff has denied Helga’s claims and maintains they were simply fired without any notification of plans for re-hiring.
While the former employees plan to start a new company to compete with Gogoyoko, Helga says such an action would be in breach of their contract, which prevents former employees from starting a competitive company. The employees’ representative contends there was no such clause in the contract and that it would be nullified by their firing regardless.
In a statement released yesterday by Gogoyoko’s board, now headed by a new director, the company denies rumours that they have ceased operations.
Grapevine background story on origins of Gogoyoko here.