My friend’s startup just laid off 90% of all employees cause of recent market downturn. Any other firms have similar stories?
Because of https://www.businessinsider.com/sequoia-capital-coronavirus-memo-to-founders-2020-3
Kabbage...I don’t think it’s just something that only VC believes lol, pretty common view
That's absolutely crazy, the uncertainty behind the duration of this outbreak is leading to some absurd market responses. Startups naturally have to adapt to market forces and if the funding environment goes dry for a quarter or two that can have enormous repercussions on the startup's cash balance/burn. But to lay off 90% of all employees sounds quite dramatic and unnecessary.
Saw this at a startup I interviewed w/, 120 ML engineers to train a chatbot, mostly to justify the next round of funding. And saw similar things at the next one and so on. Maybe 90% were busybodies to please VCs and more likely work could be reasonably done in 10%.
This doesnt make any sense. Startups are not funded by the markets and should not react to market downturns. I understand if you start having a more conservative approach and be more careful about your investments and costs but laying off 90% of employees seems exaggerated to me
It seems more like an excuse to layoff people
They are funded by the market for VC funds- which is now gone
Was the startup in a business or sector that will be extremely negatively affected by the virus? I.e stubhub type business?
This is why joining big names is better than joining a start-up. The big companies are way more stable and do not easily fire people.
I would rather invest in or join businesses that are sticky, have high costs in switching products, and defensible during economic down turns. This is quite unfortunate and 90% seems a little harsh and a lesson for everyone to keep in mind when looking for jobs
Layoffs were likely coming anyway
Letting go 90% isn’t a lay-off, that’s shutting down
If they didn’t make dollars then they didn’t make sense. I’m sure they aren’t Uber or Lyft, so there aren’t any free passes. Investors expect to be repaid.
Omg why?
Said the company had to cut costs... seems exaggerated though given it’s only been a month or so since the major downturn but who knows
That's sad. Will have to rehire as soon as everything goes back to normal, which could cost alot more.