> We’re reducing our global workforce by approximately 1,100 people, or 30 percent, in order to adapt to current market conditions.
Why does a crypto exchange need 4,000 employees?
Why does a crypto exchange need 4,000 employees?
I'm not saying that a lot of these companies aren't overstaffed (indeed, that's why they are having layoffs!) but these questions always come across as pretty naive in the same way I hear "It's just a website! I could build that in a weekend"-type comments.
I've personally watched morons come in, hire lots of useless employees, and destroy millions of dollars of cash while producing negative effect on the product in a company I cofounded. It happens.
Despite the common refrain, the question is genuinely interesting and it deserves an interesting answer. What's old is the retort "that's just how big companies work". It might entirely be true that 4000 employees is reasonable (or even low!) for an exchange, but I'd really like to hear the arguments.
Companies don't hire tons more people to maintain their existing products. They hire more people because they want to build more stuff. If you are happy just having the thing you have and keeping it up, sure. But it is clear that the past five years or so has had a big scramble to try to scoop up as much of the crypto pie as possible so you can exit for billions. That means building new features. That means hiring a lot more people. And sometimes all those new people come in, fuck up in their mission to create more value for the company, and leave it worse off.
It is true that existing product offerings for a ton of companies could be maintained effectively by a subset of their workforce. A large portion of the employees are just working on building new shit.
Someone could certainly go through the exercise of deciding how many employees Kraken, Twitter, etc "should" have to perform the functions that someone is aware of, but it's an imprecise straw man at best.
However, when a company grows rapidly due to high interest in their product, the quickest way to manage that growth is typically going to be manpower.
There are indeed better solutions, but manpower works in a lot of industries, particularly those that grow their volume quickly.
I think the surging popularity of crypto prior to our current downturn sparked some rapid growth and the need for more workers.
On the technical side you really want to build your infrastructure so that it can scale up quickly, but on the customer facing side that's not always possible and thus you might need more personnel to man the chats and phones.
It's sometimes easy to look at a problem from an external view and go wow why do they do it that way, but in my own experience there are unseen internal reasons or obstacles for why a company is not doing it in a seemingly obvious better way.
I would agree that the more employees a company has, the more the architecture/design shapes around the size of their labor force. But it also doesn't have to be that way
Let's watch Twitter and see
Because they’re not an exchange. They’re a broker, lender and apparently a bank [1].
WhatsApp is the exception, not the rule.
With 3,700 employees, that's a revenue-per-employee of $270k.
If you are a startup, that is ok, maybe even great!
If you are not a startup, and are in tech/finance that is NOT OK.
Kraken is not a startup.
Of course, my context is the tech sector and not the scammy free-for-all that is crypto, so I may be off-base.
Their RPE is more like a struggling, dingily-lit, zombie chain of brick-and-mortar retail stores than it is a tech firm.
I know HN doesn't like metrics like RPE, but they're never wrong.
edit: just looked it up. For comparison, Binance has around 6,000 employees and around $20 billion in annual revenue which is off the charts in terms of RPE, even for oil and gas. That's a sign they need to hire more.
People have no trouble understanding why Walmart has 2.3 million employees - because they roughly understand “each store has X”.