You can understand the 2020/2021 hiring at certain companies with a very clear pandemic-related angle like Zoom. But I've lost track of the number of non-answer answers, both public and private, to why companies apparently overhired. We hired more than we meant to. How does that happen?
Especially at a company losing large piles of money.
Also, I would guess major grows are due to a massive influx of tech-sales people.
This is just an extrapolation, but I would bet when the pandemic hit their email boxes and phones blowup with people throwing money at them and begging to "fix" their telephony system in a scenario where most of their employees are at home.
Now the market is bigger but also mostly adjusted and the 2021 tsunami of free money is over.
I'm sure many technical people are affected by this but they are a minority because they were never the majority of hires ( my guess )
As I've mentioned frequently before, it amazes me how many people looking at tech company financials will only look at Revenue and completely ignore profits.
What the revenue/profit plot you showed for TWLO clearly demonstrates is that there is no magic point there suddenly you increase revenue and profitably starts to increase as well. I think an assumption many people have is "if revenue keeps rising you have to be profitable soon", clearly that is not always the case.
Another pattern I've noticed is that many companies are not like Amazon, which is the model of a growth company. While AMZN does often reinvest its profits (historically to the dismay of investors) it has repeatedly demonstrated that it can be profitable. For companies like TWLO and UBER it's not obvious that they even can be profitable.
When I see this TWLO chart the message I get is that the only way to increase revenue is to increase net losses. It's not even remotely clear that TWLO can generate a profit at any level of revenue.
That's insane! I think a good future indicator before joining any company is their hypergrowth ... avoid at all cost. Smoke and mirrors. When you hear CEOs blathering on doubling, tripling etc .. headcount ... run ...
Holy shit !
They make $3.5B/y of Revenu qnd they can't afford 9k employees ?
How much are they paying them ?
and what are they doing with the rest of that huge pile of money ?
I wonder if a company should hire as many people even though the Covid drove unexpected traffic. I mean, shouldn't we build systems that scale by adding machines instead of adding people? Even if a company wants to hire for growth, shouldn't they hire a team of 2 or 3 to test water first, namely hiring for results instead of for investment?
This cut now sounds very deep indeed. It seems not at all the same as trimming against "overhiring" nor about mispredictions of growth, but instead perhaps a more fundamental concern about the health of the company.
Not surprising, given the -$500m net income result on last quarter amid slowing growth, Twilio has been burning money since a long time, despite being a public company.
Sometimes I wonder what those CEOs are doing to let a situation roll like this for so long. How boards accept this kind of thing?
Twilio has terrible numbers, you don't even need to be a VC or professional analyst to see that. They need a big cut not only in personel, but in expenses.
Checking their leadership team, there is a "Chief People Officer", "Chief Diversity Officer", "Chief Social Impact Officer", "Chief Digital Officer" and a bunch of pompous and inflated C-level titles. In fact their C-suite has 12 people!
Maybe the shareholders should be asking if their C-suite is going to be downsized appropriately.
There was a period of time after the last lay off and before the current one, I had noticed a huge number of exec level folks jumping ship, moving companies etc. I wonder if that was just in anticipation of all this? The execs do seem to be taking care of each other regardless of companies while employees argue about which companies are supreme!
Stock market. A lot of these companies are not only kept afloat but celebrated because of some future pie in the sky possibility. Everyone makes money in this game from brokers, engineers, managers, media. A perfect merry go round.
I don't think anyone really ever thought they were. I've posted a similar sentiment a bunch of times, but both of the following can easily be true:
1. There are companies that are run inefficiently, especially ones that grew spectacularly quickly during the pandemic due largely to FOMO concerns from execs.
2. Large companies have a huge number of responsibilities and needs for staff that are rarely grasped by the "It's just a website! I could build this in a weekend!" crowd.
The question that I have is: why are all these big corporations doing synchronized layoffs? Is it about having more people than needed or is it pure greed and expectations that they can easily get away with it because "everyone is doing it"?
"the United States Federal Reserve raised the Federal Funds Rate from 0.25% to 4.75% in the past 6-18 months, therefore, these companies are reacting to that and having to cut back on costs"
where it falls apart in my mind is (and I might be missing something)
why is that having such a massive impact so quickly on these companies to the point where, the cost to service NEW debt (not existing) rises?
i thought a lot of these companies had so much cash due to high tech margins that, they didn't really finance growth through cheap debt?
My free PR advice to companies announcing layoffs is to cut short on the cute company employee nicknames, keep the 'Twilions', 'stripes' and 'Zoomies' to the good times.
I love PR observations like this -- another one is to reconsider using the company blog template for such postings. This one isn't bad (though it does have prominent share buttons included), but I think it was Zoom that had a giant, cheerful "Don't forget to share!" at the bottom of theirs last week.
I’ve seen the threads, but asking again, anyone tried finding a dev job right now? How hard is it? There must be 50k software engineers looking for work. Gotta wonder how long it will take for the job market to recover
From the article
"I'm sure you're wondering why we're making additional cuts to the team after the September layoffs. At that time, we sought to streamline the company as it was then structured."
Translates as "We did a terrible job with the first round of layoffs and didn't really explore all of our options and because we messed up then we have to lay off more of you now."
Wasn't this the company that announced they were laying people off based on race in the last round of layoffs? Looks like that turned out great for them, shocked they are laying more people off now. No mention of race in this announcement though.
Note [before I get torched here]: I am saying hiring and firing based on race is insane and should be based on talent and what skills you need for the job. I am in no way saying any race is better than any other race at anything.
I wonder why people just can't be completely honest and say something along the lines of: "look, rising interest rates makes leaving money in the bank way more attractive than spending it by having x% more employees doing things that we were not sure if contributed directly to our financial KPIs. It was cool while it lasted but right now we're just keeping the cash cows and what they need. Thanks"
In my humble opinion, having used Twilio extensively for over a year, it is an awful service.
They will happily take your money and report that SMS are being delivered when they're not. They implement the most bureaucratic nightmarish processes for vetting brands which are impossible to do via the UI, and must only be done through broken/bizarre API calls that were clearly cobbled together without any design considerations. Maybe you get it all to work, but then after deliverability customer complaints a month later, you hear from Twilio that something broke on their end and you need to re-submit the vetting.
Having a major production issue? Well, you too can get a response in 3 hours by forking over 4% of your spend or $250 minimum, whichever is greater (how does that even make sense? Why should I pay more than a minimum?). And the response right at the end of the 3 hour window will consist of "We have received your issue and are passing it to the relevant team" which resets the 3 hour window. Whoops it looks like you're outside of business hours now, we'll get to it tomorrow. Unless you want to upgrade to the 8% monthly spend or $5000 minimum plan?
All that said, Twilio can burn. Burn or get their act together. I hope they get eaten by a better service though, truly.
The truth is that many of these companies can be run with fewer and fewer people as abstractions in technology become higher-level. Software takes a lot of effort to write, and much less to maintain.
We just went through an era of effectively no software, to one with a large saturation of software that fills many niches. In the 2010's there was no competition for the majority of these businesses as VC capital tended to move towards new ideas, rather than directly competing with existing ventures.
All of that is changing. The world will continue to need new and improving software, but the value provided by a single engineer continues to trend higher, and fewer and fewer developers will be needed to create these systems.
Some SaaS has high costs of switching and a defensible moat, but many do not and are easily replicated. Existing players may even be at a disadvantage to competitors due to existing architectures using old patterns that require more manual labor/cost to maintain. e.g. Something like DocuSign is a good example of a low moat SaaS. Database systems are a good example of large moat (high cost of switching, even if better tech comes out)
My favorite part of these posts are learning all the dumb names people call employees.
For anyone who has been at a place with an employee pet name that stuck, did you buy into it? Did you have to use it with a straight face or was it more of an outwards facing, recruiting tool?
This guy Jeff Lawson was virtue signalling big time about how much he loves paying San Francisco's taxes. I wonder if he's taking a pay cut while he leaves 17% of his workforce without jobs.
Over the last few years Twilio’s CEO wrote a navel gazing book and hosted some conferences about social justice, but didn’t improve the core product. I bet this made him popular with employees, though I suspect it would have made him less popular if they saw these layoffs coming.
I chose not to use sendgrid (twilio) because they force their own 2nd factor auth app, instead of allowing to use literally any of the ones already out there.
This is the impact of moving from the "growth company" to "profitable company" investment model.
Twilio and other "high growth" saas companies for the last few years have competed solely on how much they could grow the top line every quarter. Now they have to rebuild themselves.
Ukraine war outlook in 3 months China will face a severe shortage of fertilizer(they get that from Russia at over 80%) along with India and since those are two big supply chains it might be that all these companies see a rise in one of their inputs via the supply chain disruption in the future towards April-May as decreasing their profits while at the same time increasing other costs.
So my question is why is everyone assuming that it is some other economic force than this if this is the actual looming economic near term disaster?
Think back a full year when we had the last supply chain disruption, did not Governments step in a fund grants to prevent the rise in input costs?
[+] [-] shagie|3 years ago|reply
https://www.wolframalpha.com/input?i=TWLO+revenue+and+profit... isn't quite as readable for financial data, but shows the context with employees (as this is about a layoff).
[+] [-] ghaff|3 years ago|reply
Especially at a company losing large piles of money.
[+] [-] unshavedyak|3 years ago|reply
[+] [-] PedroBatista|3 years ago|reply
This is just an extrapolation, but I would bet when the pandemic hit their email boxes and phones blowup with people throwing money at them and begging to "fix" their telephony system in a scenario where most of their employees are at home.
Now the market is bigger but also mostly adjusted and the 2021 tsunami of free money is over.
I'm sure many technical people are affected by this but they are a minority because they were never the majority of hires ( my guess )
[+] [-] time_to_smile|3 years ago|reply
As I've mentioned frequently before, it amazes me how many people looking at tech company financials will only look at Revenue and completely ignore profits.
What the revenue/profit plot you showed for TWLO clearly demonstrates is that there is no magic point there suddenly you increase revenue and profitably starts to increase as well. I think an assumption many people have is "if revenue keeps rising you have to be profitable soon", clearly that is not always the case.
Another pattern I've noticed is that many companies are not like Amazon, which is the model of a growth company. While AMZN does often reinvest its profits (historically to the dismay of investors) it has repeatedly demonstrated that it can be profitable. For companies like TWLO and UBER it's not obvious that they even can be profitable.
When I see this TWLO chart the message I get is that the only way to increase revenue is to increase net losses. It's not even remotely clear that TWLO can generate a profit at any level of revenue.
[+] [-] kalnins|3 years ago|reply
A lot of huge companies doubled/tripled in size during pandemic. Did people just take on 3 jobs or where we hitting super low levels of unemployment?
[+] [-] Patrol8394|3 years ago|reply
[+] [-] pertymcpert|3 years ago|reply
https://www.wolframalpha.com/input?i=TWLO+revenue+and+profit...
[+] [-] fcantournet|3 years ago|reply
[+] [-] stiaje|3 years ago|reply
[+] [-] hintymad|3 years ago|reply
[+] [-] unknown|3 years ago|reply
[deleted]
[+] [-] MuffinFlavored|3 years ago|reply
Do this but add Federal Funds Rate /s
[+] [-] oars|3 years ago|reply
[+] [-] hu3|3 years ago|reply
https://techcrunch.com/2022/09/14/twilio-lays-off-11-of-its-...
[+] [-] xbar|3 years ago|reply
This cut now sounds very deep indeed. It seems not at all the same as trimming against "overhiring" nor about mispredictions of growth, but instead perhaps a more fundamental concern about the health of the company.
[+] [-] bob1029|3 years ago|reply
11% => 17% => ???
What did they miss in the first round such that the 2nd round needed to cut even deeper?
If they had done all these cuts up front, the effective rate would have been ~27%.
[+] [-] sergiotapia|3 years ago|reply
[+] [-] bjt2n3904|3 years ago|reply
[+] [-] unknown|3 years ago|reply
[deleted]
[+] [-] thiago_fm|3 years ago|reply
Sometimes I wonder what those CEOs are doing to let a situation roll like this for so long. How boards accept this kind of thing?
Twilio has terrible numbers, you don't even need to be a VC or professional analyst to see that. They need a big cut not only in personel, but in expenses.
Perhaps also a new CEO and leadership...
[+] [-] adharmad|3 years ago|reply
Maybe the shareholders should be asking if their C-suite is going to be downsized appropriately.
[+] [-] flashgordon|3 years ago|reply
[+] [-] negamax|3 years ago|reply
[+] [-] x0x0|3 years ago|reply
It's approved by the board. They signed off as part of some strategy. No way a ceo outside of Zuck is permitted to lose money like this otherwise. https://www.macrotrends.net/stocks/charts/TWLO/twilio/net-in...
[+] [-] onlyrealcuzzo|3 years ago|reply
[+] [-] hn_throwaway_99|3 years ago|reply
1. There are companies that are run inefficiently, especially ones that grew spectacularly quickly during the pandemic due largely to FOMO concerns from execs.
2. Large companies have a huge number of responsibilities and needs for staff that are rarely grasped by the "It's just a website! I could build this in a weekend!" crowd.
[+] [-] x86x87|3 years ago|reply
The question that I have is: why are all these big corporations doing synchronized layoffs? Is it about having more people than needed or is it pure greed and expectations that they can easily get away with it because "everyone is doing it"?
[+] [-] MuffinFlavored|3 years ago|reply
"the United States Federal Reserve raised the Federal Funds Rate from 0.25% to 4.75% in the past 6-18 months, therefore, these companies are reacting to that and having to cut back on costs"
where it falls apart in my mind is (and I might be missing something)
why is that having such a massive impact so quickly on these companies to the point where, the cost to service NEW debt (not existing) rises?
i thought a lot of these companies had so much cash due to high tech margins that, they didn't really finance growth through cheap debt?
[+] [-] dkyc|3 years ago|reply
[+] [-] joegahona|3 years ago|reply
[+] [-] phpisthebest|3 years ago|reply
lets just cut it completely.
[+] [-] Redsquare|3 years ago|reply
[+] [-] vortexo|3 years ago|reply
https://gusto.com/company-news/josh-reeves-message-to-all-gu...
[+] [-] burkaman|3 years ago|reply
[+] [-] greatpostman|3 years ago|reply
[+] [-] wonderwonder|3 years ago|reply
Translates as "We did a terrible job with the first round of layoffs and didn't really explore all of our options and because we messed up then we have to lay off more of you now."
Wasn't this the company that announced they were laying people off based on race in the last round of layoffs? Looks like that turned out great for them, shocked they are laying more people off now. No mention of race in this announcement though.
Note [before I get torched here]: I am saying hiring and firing based on race is insane and should be based on talent and what skills you need for the job. I am in no way saying any race is better than any other race at anything.
[+] [-] cardosof|3 years ago|reply
[+] [-] mshake2|3 years ago|reply
They will happily take your money and report that SMS are being delivered when they're not. They implement the most bureaucratic nightmarish processes for vetting brands which are impossible to do via the UI, and must only be done through broken/bizarre API calls that were clearly cobbled together without any design considerations. Maybe you get it all to work, but then after deliverability customer complaints a month later, you hear from Twilio that something broke on their end and you need to re-submit the vetting.
Having a major production issue? Well, you too can get a response in 3 hours by forking over 4% of your spend or $250 minimum, whichever is greater (how does that even make sense? Why should I pay more than a minimum?). And the response right at the end of the 3 hour window will consist of "We have received your issue and are passing it to the relevant team" which resets the 3 hour window. Whoops it looks like you're outside of business hours now, we'll get to it tomorrow. Unless you want to upgrade to the 8% monthly spend or $5000 minimum plan?
All that said, Twilio can burn. Burn or get their act together. I hope they get eaten by a better service though, truly.
[+] [-] adam_arthur|3 years ago|reply
We just went through an era of effectively no software, to one with a large saturation of software that fills many niches. In the 2010's there was no competition for the majority of these businesses as VC capital tended to move towards new ideas, rather than directly competing with existing ventures.
All of that is changing. The world will continue to need new and improving software, but the value provided by a single engineer continues to trend higher, and fewer and fewer developers will be needed to create these systems.
Some SaaS has high costs of switching and a defensible moat, but many do not and are easily replicated. Existing players may even be at a disadvantage to competitors due to existing architectures using old patterns that require more manual labor/cost to maintain. e.g. Something like DocuSign is a good example of a low moat SaaS. Database systems are a good example of large moat (high cost of switching, even if better tech comes out)
[+] [-] dheerajrav|3 years ago|reply
- [here](https://linkedin.com/in/dheeraj-ravindranath) - https://github.com/dheerajrav
[+] [-] madamelic|3 years ago|reply
For anyone who has been at a place with an employee pet name that stuck, did you buy into it? Did you have to use it with a straight face or was it more of an outwards facing, recruiting tool?
EDIT: Twizzlers is a much better name.
[+] [-] joegahona|3 years ago|reply
[+] [-] diebeforei485|3 years ago|reply
[+] [-] ghiculescu|3 years ago|reply
[+] [-] gaoshan|3 years ago|reply
[+] [-] orangepanda|3 years ago|reply
Anecdotal, but still
[+] [-] FollowingTheDao|3 years ago|reply
These businesses know what’s coming. Get ready for a higher than expected inflation rate tomorrow.
https://news.ycombinator.com/item?id=34774930
[+] [-] johndhi|3 years ago|reply
Twilio and other "high growth" saas companies for the last few years have competed solely on how much they could grow the top line every quarter. Now they have to rebuild themselves.
[+] [-] fredgrott|3 years ago|reply
Ukraine war outlook in 3 months China will face a severe shortage of fertilizer(they get that from Russia at over 80%) along with India and since those are two big supply chains it might be that all these companies see a rise in one of their inputs via the supply chain disruption in the future towards April-May as decreasing their profits while at the same time increasing other costs.
So my question is why is everyone assuming that it is some other economic force than this if this is the actual looming economic near term disaster?
Think back a full year when we had the last supply chain disruption, did not Governments step in a fund grants to prevent the rise in input costs?