Restructuring Announcement

[melbourne_mat]

From an alternate universe:

I apologize for my erratic behavior which has tarnished our brand and created unnecessary turmoil within our organization. Regrettably, we will need to implement a 16% reduction in headcount to address the financial challenges we now face. I have decided to step aside and hand over control to my deputy, who I believe will provide the steady leadership needed to rebuild trust and restore our company's vision.

[KennyBlanken]

He'll never admit he was wrong or step down. He'll drive Automattic into the ground and Wordpress along with it (until someone forks it, like say...WP Engine, heh. Or Redhat, or IBM, or some huge web design firm, etc.)

He considers Wordpress "his" even though...he took it over from the original author who was abandoning the project.

It reminds me of the rage-bender Jamie and Jim Thompson went on, attacking OPNsense for "stealing" their work and doing a lot of immature things taking over opnsense's domain, their subreddit, etc. via legal actions. And at least one lawsuit. They lost on every front - reddit gave the subreddit back to the opnsense developers, ICANN gave them back their domain name, etc.

Attacking OPNsense for "stealing" pfSense was pretty rich given pfSense's origin; netgate slapped their logo on m0n0wall and started working on their fork. Which is exactly what opnsense did that enraged them...

Especially as pfsense software started getting more user-hostile and shifting functionality into the paid versions, pfsense has rapidly become less and less popular. I almost never see anyone recommend it anymore.

[solardev]

If only we had real leaders...

[loco5niner]

I read this out of context and thought it was referring to Trump.

[gregoryl]

Huh.

>> There are no layoffs plans at Automattic, in fact we're hiring fairly aggressively and have done a number of acquisitions since this whole thing started, and have several more in the pipeline.

https://old.reddit.com/r/Wordpress/comments/1hxnh73/automatt...

[snitty]

It's not uncommon for companies to be in a hiring mode until they're very much not in a hiring mode any more.

[lolinder]

That was important posturing to make sure that everyone knew that his nuclear war on WP Engine was absolutely not going to impact his ability to run the business and the WordPress project. Whether it was true or not it didn't matter at the time, the important thing was to keep up appearances and not let anyone on Reddit think they knew better than Matt.

[pityJuke]

How infuriating for anyone recently hired caught in this trap.

It seems to me the obvious, from both a business & human perspective, is to stop hiring at first signs of trouble, before layoffs. To do so otherwise is cruel.

I doubt Matt had zero idea about this possibility two months ago.

[dccoolgai]

So if you took the deal last year you would have gotten 9 months, now the severance is 9 weeks. Way to reward "loyalty". Good thing we're so smart and better than everyone else and we don't need unions.

[hinkley]

Financially your best bet is to be in the 1st round of layoffs. Ego-wise, it's best to be in the second round. First round there's still some money and a lot of guilt, so the severance tends to be good.

By the time they lay off truly essential people, you're burnt out, and you're lucky if you don't have to sue to get what you're owed by law, let alone whatever policy they had for paying out vacation time or what have you. You also get to enjoy a fun period of survivor guilt when they laid off people who you think have contributed as much or more than you have, and then know that you'll be next if they laid of <person> already.

[Centigonal]

Relevant comment from 24 days ago: https://news.ycombinator.com/item?id=43309837

[refuser]

Not especially surprising, but there’s an awfully large elephant in the room that likely directly contributed to this necessity that goes completely unmentioned.

[mgdev]

Matt's only real problem is not owning his ambition openly.

Trying to publicly argue the moral high ground was a stupid, unforced error.

It didn't need to be moralized at all. Just make the changes you want to make, piss off a vocal minority, then get back to winning and making boatloads of money by executing exceptionally.

The problem, I suspect, is that Matt values how certain people perceive him more than he values winning. It's unfortunate, because he's clearly a very good executer and strategist. He's getting in his own way.

[solardev]

Drupal's sudden popularity?

[uoaei]

Is the elephant in the room with us now? (Mind filling in?)

[anthomtb]

> This restructuring will result in an approximately 16% workforce reduction

Probably the most salient detail for non-Automattic employees. Everything else was generic fluff.

[jihadjihad]

> non-Automattic employees

non-Automatticians. Yes, they literally used this term in TFA.

[blatantly]

Plus severance will be paid but didn't say how much.

I was thinking this is a boilerplate firing email though!

[lenerdenator]

Given what I know of the situation (which admittedly isn't much), wouldn't the best course of action be to shitcan the CEO?

[dangrossman]

From Reddit discussions, if they can be trusted, there is nobody who can remove Matt from any position. It's a private company and the investors were given non-voting shares.

[wmf]

With apologies to Louis XIV, Matt is Automattic.

[FlamingMoe]

Mentioning "our revenue continues to grow" seems quite out of place in an announcement like this.

[Arainach]

I disagree - it's not properly addressed, but it's nice to see it at least brought up.

Layoffs are always awful, but seeing companies talk about "changing economic realities" amongst continuing revenue and profit growth - often all time highs - is a real morale killer for those who are left behind.

Microsoft/Amazon/Alphabet/Google are trillion dollar megacorps who are insanely profitable, but they're firing people because they no longer have to pretend we care about you at all and will instead try to cater to Wall Street (who will never be happy - if I had $10000 for every quarter where a big tech corp "beat expectations" and the stock dropped anyway I'd retire). It's a hard pill to swallow and will increase bitterness and cynicism in the remaining workforce and kill any chance of your employees caring about your vision or putting in any extra effort.

[anon7000]

I think it's just saving face. That statement could be true if revenue was growing at 1% or 10% or whatever.

[altairprime]

If opex is growing at a faster rate than revenue, and it’s not a VC situation, then layoffs are a popular way to curtail opex — typically business leadership cannot effect changes that would eventually impact themselves, so, the board and executive layer prefer to mass-layoff workers and middle management first and then let the remaining leadership fight for their life to present optimized plans. This is of course a terrible approach, because — as Taskmaster quite enjoyably demonstrates — even the smartest people tend to make a lot of asinine judgment calls under duress and deadlines; but when the alternative is to admit weaknesses of leadership, it’s certainly a logical enough course of action.

[kstrauser]

> They also have our enduring gratitude for their time with the company.

I hope the RIF'd employees can pay rent with that gratitude.

If I were considering using Wordpress for anything, which I am not, this would end those plans. If they're laying off and keeping the CEO, they must be in dire financial straits. That message says "we're doing all the right things and have good leadership with a track record of making good decisions, but we have no alternative but to fire a sixth of our employees". That's not a good sign.

[phendrenad2]

I wonder if the CEO throwing a tantrum that another company was using "their" open-source (thus, not theirs) code wasn't the real problem, but it made investors take a closer look, and they noticed that Automattic has less of a moat then they thought.

[chris_wot]

This might not have happened if Mullenweg hadn’t sued his competitor, then went off the deep end and hurt everyone.

[DannyBee]

I think this is a bit unfair.

Who among us can really say they haven't gone off the deep end, burned every drop of good will that ever existed towards them and their projects, sued a competitor and got hilariously burned by the judge, all while burning hundreds of millions of your companies value (blackrock marked them down 10%, which is 750 million)

This is just a normal thing that happens. It could have happened to anyone.

[1shooner]

Another interpretation would be a common cause for both this and the litigation, i.e. pressure to improve financials.

[ceejayoz]

It may also have been part of his reason for doing so. Panic/desperation.

[Kye]

There's a parallel timeline where he admitted he messed up, stepped down, hired a real CEO, put someone else in charge of the nonprofit, and the downward slide he caused started to reverse.

[nightpool]

Haven't seen any public reporting on this yet, but from internal conversations this seems to include a 60% workforce reduction at Tumblr, which now only has a few remaining engineers.

[treecrypto]

I actually started paying the subscription for my Tumblr account a couple years ago. I don't get much direct benefit from it, I do it because it's the only social media site I use and enjoy, and I was hoping it would help keep it from shutting down. 60% workforce reduction is not great.

[IG_Semmelweiss]

i dont mean to kick a dead horse, but a "few remaining engineers" for what is effectively an outdated clone of a microblogging site, a few engineers, seems like a lot still

[donohoe]

Yeah, that’s my understanding as well

[bsima]

I used to be a big admirer of Matt and Automattic, but after this whole WP Engine episode I've lost respect. I shut down my old wordpress blog, still working on importing the posts as org-mode files onto my new site, I no longer recommend WP to non-techies that ask me how to build a website.

I hope WordPress (and Automattic) turn the ship around but its not looking good at this point.

[bionhoward]

HR wranglers? Damn, that’s simultaneously hilarious and terrifying

[DeathArrow]

>A comprehensive package covering severance pay and benefits.

What does this mean in term of monthly wages?

I was a technical lead for the Romanian branch of an US company. They fired me along with my team and other teams. The reason was they were profitable but they missed the ARR by a million or something. Last year they did the first firing round, this the second.

When they announced they will fire us, they also announced they will hire more sales people. The ratio of business people/tech people was already 7:1 before that. They also said a programmer should produce 5 times the money the company spent with him, and we were at 4 point something.

Now I have found a position at a local company which takes care of its people even in harder times.

[rob]

"Either I'm an idiot, or something is going on that you don't understand. Let's check back in a month. :)"

https://www.reddit.com/r/Wordpress/comments/1glejno/comment/...

...1 month later...

https://www.courtlistener.com/docket/69221176/64/wpengine-in...

[ssimpson]

Executive behaves like a child, labor suffers the consequences.

[emaro]

I wonder what this means for the future of Beeper.

[fooqux]

I'm wondering the same thing. Considering they were just acquired, I'm concerned. Especially since as far as I know, they still are operating under a free model.