Coinbase announces it will slow down hiring | Hacker News Reader

Coinbase announces it will slow down hiring

blog.coinbase.com

145 pointsjimmy2020176 comments

> Heading into this year, we planned to triple the size of the company.

I wonder what "slow down" means exactly in this context. Complete hiring freeze? 10-50% growth? Even if there was no market downturn, how were they even planning to integrate 3x the people within the company in such a short period of time.

Coinbase revenue increased 514.76% from 2020 to 2021. They were also profitable in 2021. Adding 3x people probably made sense, if they think that that revenue will continue to increase.

https://www.google.com/finance/quote/COIN:NASDAQ

Something maybe more worrying is that you can see in the financial results of Coinbase that they invested into BTC themselves, and there is threshold where they would lose funds and likely have to liquidate BTC aggressively :/ (it's public)

If they're profitable why would they panic sell?

What's their average buy-in price?

Out of my head (has to be verified), it was around 25'000 USD.

I deducted by comparing their portfolio value at last quarter vs this quarter.

I interpret this as hiring freeze.

When I read corporate emails and “official” messages, I always take the least charitable interpretation. So what’s the most unattractive thing that fits their definition of slowing down, that’s a hiring freeze.

This uncharitable view is the opposite when I encounter genuine human interaction where I try to view the most charitable.

But if a lawyer has read through it, then the most weaselly interpretation is probably truist.

Corporations are sociopaths, and we think this is a good idea for some reason

Of course they are. It is good. Corporations, like functions, are sociopaths. They’re just rulesets. They aren’t real people so they can’t be anything but sociopaths, although I don’t think that’s an accurate term for a non-person. Are deer sociopaths? Or trees? Or virii? Or bags of rice?

I want the emotions to be with the people who make up corporations (and write the functions).

Except these rulesets are at the top of the food chain within our society.

As for the people who make up the corporations, they turn into sociopaths themselves as their emotion and empathy dissipate the higher they get in the pecking order.

I don’t think that’s true. Or would need to see a lot of studies. I’ve interacted with c-level execs in many industries and companies and sociopaths are pretty rare.

Also, sociopaths aren’t bad, they just extremely focus on goals. Psychopaths are bad sociopaths who harm others. If you have a sociopath surgeon or something that could actually be beneficial to society as they’d just perform tons of surgeries.

"Roughly 4% to as high as 12% of CEOs exhibit psychopathic traits, according to some expert estimates, many times more than the 1% rate found in the general population and more in line with the 15% rate found in prisons."

https://www.forbes.com/sites/jackmccullough/2019/12/09/the-p...

Idk spend more time on the robo phone line with CVS trying to get a prescription you need to live and tell me it’s a preferred state of order

They have 3.7k employees, which means by the end of the year two thirds of the employees would have been there less than a year. Did anyone ever go through a similarly extreme hiring period as an employee? I can't imagine how disorienting it must be.

Negative growth

Looks like pretty much all high tech company's slowing the hiring. That usually indicates that in few months it would not be surprised to see stating the blood bath in tech companies.

blood bath is already happening

interest rates raising, layoffs, entry level role hiring halt, etc.

i’m launching a startup this year fearing it would end up underfunded

I wonder if Microsoft will reconsider their pay bumps.

I think it's the opposite thinking at Microsoft: they see here an opportunity to change their reputation as "the forgotten FAANG", not even in the acronym because it doesn't pay as well as the SV companies.

The MAAGMATENN ms, aapl, adobe, goog, meta, amzn, twttr, eBay, netflx, nvidia.

Ok that’s just forcing it.

Adobe? Yeah that’s forcing for sure.

Look at the five year stock growth, dark horse among the tech companies for sure

The stock is good sure, but I always figured that FAANG was more about their reputation as employers than it was about their reputation as an investment.

Personally speaking, I do not go to companies for clout but I'm also not interested in bragging to other engineers in the form of xGoog xUber etc

I go for the stock price because those RSUs are my retirement plan.

I think it's the opposite actually. I remember FAANG being used as a reference to hot stocks.

Investopedia seems to claim the same: https://www.investopedia.com/terms/f/faang-stocks.asp

I often forget eBay even exists.

I know some people there who are payed very well and ride the shuttles from the same pick up spot the FAANG buses pick up from in SF, near Castro.

Drop an A for an E and you could have MANAGEMENT, everyone already knows about the great pay there!

It should already be FAAMG for a year or two now

I think you mean MAGMA

Facebook is Meta but Google isn't Alphabet?

Fine, MAMMA it is then :)

Wouldn't it be MAAMA?

    Just hired a man, put the idea inside his head
    Pulled the trigger, now his career's dead.
    MAAMA! Funding had just begun,
    but now my crypto has gone and blown it all away.

Or knowing Amazon, they'll probably revert theirs.

granted, if I had large amounts of capital in the bank but competitors are laying off talent, I'd snap them up in a jiffy...

The blood bath will be real when companies start filing for chapter 11 or being sold at distressed prices. Right now we are blood bath-adjacent.

I'm looking for a job right now and honestly the market is red hot. Total comp is higher than I've ever seen and I'm even getting the opportunity to pick my interview style (eg: opting out of leetcode style interviews). I'm really enjoying the change.

I'm going to be looking soon, any tips that've been working for you so far? What sites were you looking on? Were you requesting interview type up front or just applying to ones that mention it, etc.?

Yes!

- hired.com is good for startups; startups are often matching salary and benefits with top engineering firms and don't do geopay.

- (as usual) keyword optimize your resume and sync it with LinkedIn. A lot of managers, corporate recruiters, and third party recruiters are using LinkedIn search to find candidates. I use LinkedIn as a medium-quality queue.

There is a strange rash of companies putting their total comp (and base pay) under NDA. I generally let recruiters know that I think it's important to be up front about compensation from the beginning and starting the conversation from a place that makes sense with my experience.

Yes, I let recruiters know that if I have to do a leetcode interview then they go to the back of my queue (I can do them decently well; I'm just exhausted with them and don't see value). If they're project based or where they want to look at my GitHub then they go to the front. One thing that helps them meet in the middle is that I explain that I'm developing a short list of five companies and that I will knock all of those interviews out in one week and promise not to hedge offers against each other.

Sweet, thanks for the tips!

> There is a strange rash of companies putting their total comp (and base pay) under NDA.

Which country do you live in? IANAL but I believe this is protected speech in the US [1].

[1] https://money.usnews.com/careers/articles/should-you-tell-yo...

I'm a US citizen, honestly, my first thought was that it sounds shady and illegal. I'm not a lawyer nor do I have the time or energy to fight them on it, I just tossed it in the trash because there's a long queue ahead of them anyway.

Colorado was the first state to require salary ranges in job listings. More states have since legislated the same, and California might have a draft bill out, I believe.

Here's an example:

  Totally understand if not the right time but was keen to see if you'd be interested in discussing a fully remote Site Reliability Engineer position with one of the leading global cryptocurrency exchanges, who are driving the mainstream adoption of blockchain and crypto technologies and have grown from a small scale up to over 1500 people in the last four years?

  They attract some awesome people globally and pride themselves on a no-ego team who are brilliant technically, but work together to achieve great things in a complex environment.

  I'm under NDA on salaries so can't mention exact figures, but can say total comp can run into the hundreds of thousands on base, bonus and equity. The role is fully remote from anywhere in the US.  

  The SRE team tend to be 'dev heavy' and are using Rust and Golang currently however are open to candidates with experience in Python or Java too. You'd be introduced to Rust if needed (experience not required) and will have wider responsibility for ensuring reliability processes and the build and upkeep of container environments supporting massive volume live cryptocurrency trading platforms.

  It would be great to tell you more, would this be of interest?

>"Yes, I let recruiters know that if I have to do a leetcode interview then they go to the back of my queue (I can do them decently well; I'm just exhausted with them and don't see value). If they're project based or where they want to look at my GitHub then they go to the front."

I'm curious what your views on interviews that require "take home projects." Companies have no skin in the game when they require you to use your nights and weekend hours to complete their project. As a result it's not uncommon to submit these and then be ghosted. I don't think I would agree to one now. The other issue is how many of these 4-5 hours can a person do in a month?

That is a perspective, and a valid one at that if you have kids or other obligations.

I dropped out of college, so a lot of the math this industry uses I had to learn on my own. I bought a lot of books and sweat over studying them, I had a leet code subscription too. The problem with this interview scheme is that:

1. It's timeboxed and our work is rarely, if ever, timeboxed to 30 minutes or less.

2. I've rarely, in my day to day work, implemented these algorithms by hand. I just need to know which to use and when to use it. When I do need to implement them I generally have a reference and I have a good reason for implementing it (like in Go with a lack of generics).

3. It's purely for the employers benefit. I gain no insight into the kind of work the team does, how it gets done, etc...

4. I have never in the history of my career had a more senior engineer watch me code in real time and criticize me.

Personally, I think companies need to offer a set of interviews. The typical leetcode for people who have gotten used to that, take home exercises for people that don't want to deal with leetcode, or even submitting example code that's relevant to the position. I'm also of the opinion that the time sunk into interviewing is the same between "problem solving exercises" and take homes. You spend months preparing on leetcode for one, but you invest a week at a time into take homes. I have been able to share take homes between companies, so I think these can be reasonably spreadload as well.

Any of these can be abused, imo, but none are more abused than leetcode or "problem solving exercises".

imho it's the blowback of covid + the few years before.

Companies hired based on temporary trends that could mostly be explained by covid. They scaled their team accordingly, now that people start to go out again they get less users/sales/engagement they have to scale back down.

Yeah, I don’t see what is unhealthy about the underlying economy

Binance has ~10 times the trading volume with the same number of employees

The cost of operating a US company in a highly regulated environment. Binance US, the closest comparable, "only" does 10% of the volume of Coinbase, or 20% if you take into account that half the Coinbase users are not from the US.

https://www.coingecko.com/en/exchanges/binance_us

Exactly. It's amazing how efficient you can be when you don't have tons of pesky government rules and regulators breathing down your neck.

It's also amazing how much damage you can do.

It's also amazing jus how much damage regulators can do, who may occupy a priveleged seat of corruption that is neither beholden to the customer nor the provider of the goods. Often (most) time the regulator is not even sitting in an elected position, with only the loosest accountability to the voter.

The regulators are not corrupt. You believe that without evidence because it's part of your political ideology.

Hours ago you called the court of the land "corrupt hyper-partisan" and now you believe there's no evidence of corruption in the vastness of the regulatory agencies?

Spare me the hypocrisy.

Some regulars are corrupt. Some are not. Some government officials are corrupt. Some are not. Some business people are corrupt. Some are not.

Any position of power has the potential to fall to corruption, if proper checks and balances aren't put in place to prevent it. GP simply seems to believe that regulators are insufficiently held accountable to avoid corruption from taking root.

Are you sure you yourself don't believe something without evidence ("regulators are not corrupt") because it's part of your political ideology?

I would also add that most businesses of a certain size ARE corrupt.

A great deal, possibly even most, people can be corrupted if placed in a position that enables it. Any regulatory mechanism implemented has to bear in mind that the underlying problem is that _people_ are corrupt. Putting people in a position where there is no check (such as voting, or customers choosing whether to buy) on that corruption makes everything more dangerous.

My position all along has been that businesses are greedy, oft corrupt, enterprise. So it shouldn't surprise anyone that individuals in the revolving door between industry and regulator are still corruptible people -- whether they are in the role of regulator or business director. These revolving door individuals didn't suddenly become corrupt when entering business or become pure when entering regulatory agencies.

> The regulators are not corrupt.

And what would you say the basis for you believing that is?

Likewise, regulators are not beyond reproach and one's political ideology influences that perception.

So obviously the answer is no regulation, and to let Ponzi schemes and rug-pull scams be a de-facto tax on those who fall for the marketing, with the beneficiaries being the perpetrators.

If you were completely uncreative or speaking in bad faith, you may come to the conclusion that your "obvious" answer of such a false dichotomy.

GP was referring to Binance and not Binance US, I think?

FTX has only 300 (< 1/10th that of Coinbase) with 5x the volume (depending how you measure)

https://ftx.com/volume-monitor

Binance is a bucket shop with faked volume

Facebook, Coinbase, all these companies publicly announcing hiring freezes. There should be plenty of other tech companies and non tech hiring, but will this soften wages?

All those crazy 500k+ offers going around over the last 6 months are already softer thanks to RSU value dropping. Some people are already getting 30% less then they thought they were getting (at least for now).

The big secret is those companies knew a sell off was imminent and that their stock was overvalued. The 500k offers were really 350k offers in disguise.

I really doubt this. Why do you think they knew a sell off was imminent?

Because they have financial analysts working for them.

If hedge funds can't reliably predict a market crash, why do you think a team of accountants at an Amazon office can? And if they could, why don't they exit their core business and get into trading stocks?

The difference is between a reliable prediction and a precise and timely prediction.

The accountants at Amazon have material non-public information that they can't act on for obvious reasons, but if they know beforehand - for instance - that sales aren't growing as fast as they used to, or that luxury purchases are trending downward, they can forecast that their own price might slump in the next few months.

They can still buy and sell their own company, but they have to respect the black out dates.

> They can still buy and sell their own company, but they have to respect the black out dates.

Trading on specific non-public information is insider trading and is illegal at all times - even during official trading windows.

I’d be more impressed if they could predict market conditions 3+ years from now, when the bulk of the Amazon employees’ shares are actually vesting.

Maybe they can, but I think that’s a very generous assumption.

It's all about timing.

> hedge funds can't reliably predict a market crash

Hedges can predict a recession is coming, just not the timing. They have been saying it for the last 12 months.

> a team of accountants at an Amazon

Amazon hires ex-bankers to work for them. They aren't a team of accountants. It's a cushy corproate job that many bankers take. It's good to do when you don't want to hustle long hours anymore.

> And if they could, why don't they exit their core business and get into trading stocks?

What?!

Insider trading is illegal for a reason.

At the $1T+ scale, their CFOs are constantly road-tripping to find new institutional buyers. It stands to reason they’d perhaps know which way the wind was blowing based on those interactions.

Honest question: what does a public company have to gain by convincing institutional buyers to buy its stock? I can't imagine that to have any lasting effect on the stock price.

Why would they need to go woo institutional buyers? At 1T they're already probably part of S&P 500 and other standard investment indexes. All the mutual funds, ETFs, pension plans are bought into them.

for me personally it was rate-hike rumors/announcement by the Fed

in high-rate environment high-risk high-growth stocks are unattractive, so investors pull the money out and invest it into “safer” assets

don’t forget that many investors are leveraged too and a sale of one big investor might trigger a selloff chain reaction

it's easy to predict the past

did you short?

i don’t short, but i buy more at lower price

it’s well-known economic fact that after a crisis there’s always recovery

How’d that work out for Enron?

Or Lehman or ...

Just they went public

Totally agree

Well, there are two categories of wages for tech workers: FAANGs and everyone else.

If the tech stock bloodbath continues, that certainly will impact wages on the FAANG side. People might start leaving for places that offer more cash comp, or FAANGs might increase RSUs to compensate.

It seems like a lot of the recent wage growth is at the lower-mid tiers, which make up the bulk of the industry. So, if companies that pay in the $80-120 range start cutting back on hiring, we might see a softening of wages for normal developers. I have not seen this happening...yet.

Not necessarily. The FAANG stock prices are low right now due the overall market slump (except may be FB or NFLX). They will highly likely bounce back along with the rest of the market in a while. So getting a fat count of RSUs from a FAANG company at a bargain price (usually based on price on/around starting date) may likely have a huge payoff in a few years.

I agree, but you are still betting on a lottery ticket here. Likely, a lot of companies might not recover and just slowly grow (Netflix?) and not make too much movement.

Netflix pays cash so engineer comp is fairly insulated from market fluctuations. In the past few years, that may have seemed like a negative, but right now it’s a blessing.

I've gone through several jobs over the last year (I managed to join a company that got acquired by a company I wasn't happy with).

Smaller and medium companies are offering great salaries right now. I took an offer for over $300k just on salary. I know others who are jumping ship from the big companies to smaller ones while still getting a big bump in salary. Even with this market slump there are far more open positions than there are people to fill them, which means those people can demand quite a bit.

Can I ask what space you work in where they are offering 300K base at a smaller or medium company? Is this in Finance/Fintech ?

I've avoided fintech in my career- I currently work for a company called Aptible (currently hiring, and with great revenue so we're not dependent on investment) that manages infrastructure for companies that need HIPAA compliance.

That said I interviewed for a bunch of companies, and with the exception of a small few all of the salaries were above $250k. This is for principal level roles.

Demand is still huge for tech jobs. Even outside of tech, there are more jobs than there are people to fill them.

Facebook and Coinbase are unique cases. Coinbase was fueled by cheap money and crypto craze. Facebook is ceding way to TikTok and due to huge investments in VR tech. Companies with profits should tighten the hatches and come out fine after 12-18 months.

I heard rumors that they are actually planning layoffs.

The amount of hiring in the past 12 months is insane.

Previously they had announced expanding their NFT offerings. Hopefully the executives realized that was a fruitless endeavor.

why do they post this public blogpost. Companies change their hiring patterns all the time. I don't understand why they need to make a blog post about it.

Possibly because they think investors need to know about it - since they are a publicly-traded company - and want to avoid running afoul of SEC regulations. (Note: I am not a securities lawyer; this is admittedly a guess.)

A blog post to not run afoul of SEC regulations? I don't think so..they could easily bring this up at earnings.

I’m not a securities lawyer but I can imagine that some material information might need to be disclosed immediately. I’d love a more knowledgeable person to chime in.

Coinbase did make an SEC filing copy of the blog post: https://www.sec.gov/Archives/edgar/data/0001679788/000110465...

> On May 16, 2022, Coinbase Global, Inc. (“Coinbase” or the “Company”) issued a blog post (the “Blog Post”) relating to its hiring plans. In connection with the Blog Post, Coinbase affirmed its expense outlook for the second quarter of 2022 and full year 2022 that the Company provided on May 10, 2022 in a letter to its shareholders announcing its financial results for the quarter ended March 31, 2022. A copy of the Blog Post is furnished as Exhibit 99.1 to this Current Report on Form 8-K.

> Coinbase announces material information to its investors using filings with the Securities and Exchange Commission, the Company’s website at www.coinbase.com and blog.coinbase.com, as well as press releases, public conference calls, public webcasts, its Twitter feed (@coinbase), its Facebook page, its LinkedIn page, its YouTube channel, and Brian Armstrong’s Twitter feed (@brian_armstrong). Therefore, Coinbase encourages investors, the media and others interested in the Company to review the information it makes public in these locations, as such information could be deemed to be material information.

> The information in Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of such section or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.

So whether or not they were required to communicate the slowdown, they did at least consider the post to be material information that needed to be communicated with investors.

If someone employed there wants to trade then they have to announce or risk insider trading. When the trade can’t wait until the usual information release then you will see sudden announcements like this.

Nice, they covered their ass

Earnings only happen quarterly. There's lots of events that need to be communicated more urgently than that. And there's no way you could keep a lid on something like this for up to potentially 90 days. People (internally and externally) are going to notice that no one is being hired there anymore.

And it's worth pointing out that large companies are constantly posting disclosures, sometimes as frequently as daily. Here's one example (Google): https://sec.report/Ticker/GOOG

The bar for disclosure is quite low, and is not dependent on quarterly cycles.

The point is for outside investors to ensure them that money is well spent and the company is on path to success. Common for public companies to do this.

For those depending on investor money to survive, aka the cash-flow-after-funding crowd. For others not so much, those only communicate head count reductions most of the time.

Coinbase has seen their stock price plummet by 80% in the last 6 months. For comparison, the NASDAQ is down 25% and the Russell 3000 is down 16% over that same period. In other words, Coinbase has performed much worse than most other equities.

This decline in stock price was exacerbated by the recent crash in crypto prices and a large net income loss in Coinbase's most recent quarterly results.

All of this to say, investors' confidence in Coinbase has been absolutely rattled. An announcement of a hiring slowdown/freeze or layoffs could accelerate the Coinbase sell off if it is misinterpreted as evidence of a meltdown of the business. So Coinbase is trying to get out in front of and own the message around their change in hiring patterns. "We are acting as good stewards of your investment, and no reason to panic."

This post surely addresses many stakeholder groups, but investors seem to be the primary constituency that is being reassured.

If crypto is mostly a "get rich quick" scheme and shortcut to riches plummeting prices will cool down the hype fast. There's no such thing as a money printing machine that doesn't backfire.

It's not a get rich quick scheme, it's a Ponzi scheme. o Once you can't convince new suckers to buy in the system collapses and the one left holding the bag loses everything.

if that's a ponzi scheme then so is the USD.

The USD has intrinsic value - the US government insists on receiveing its taxes in USD, and only in USD. This alone creates trillions of dollars per year of real demand for USD. Crypto doesn't have anything like it.

I think they are trying to get the price of crypto to drop.... to be able to buy back .... I dropped Coinbase long ago, they manipulate the market too much (I.E.: You can't sell if price drastically go up, etc)

They know it'll leak, so being public minimizes damage.

This is happening in tech companies across the board. From my network I understand many companies have either stopped hiring or have strongly reduced hiring.

I can’t really say. I’m still getting hammered with inquiries.

I am wondering if some of these inquiries are from slightly shady recruitment agencies. I know people have still been approached for the positions my company has pulled.

The rut mostly seems to affect the tech sector. There are plenty of sectors that are fine.

I would go far to say as the majority of recruiter inquiries I've received in my life have been for pulled positions, used as bait to start engagement with the recruiter.

Why not just shut down now and give everyone a nice package instead of dragging it out and laying folks off with nothing/the-minimum-legally-required?

Has anyone thought of doing that with a business or is the default instinct to fight it out until the bitter end?

so did meta, netflix, twitter, uber, robinhood, carvana, better, peloton, upstart...

Hell is freezing

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