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Comment by mrweasel | Hacker News Reader

While I do feel sorry for the people who are losing their jobs, I do wonder why so many of these unicorns / VC funded / startups / Silicon Vally darlings, all seems like they are, shall we say, a bit overstaffed?

If you can lay off between 10% or more of the staff and expect to continue to operate unimpeded, then why didn't they do it sooner? I'm not counting Twitter, because while perhaps overstaffed, firing 50%+ is just nuts.

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The whole point of taking funding is that it lets a company grow headcount ahead of achieving the sales to sustain it. So they'll estimate that X headcount will be needed Y months in the future. When growth doesn't materialize then X comes down and when funding is less available then Y comes down. Then they have layoffs.

X and Y became unusually high in 2021. If we have an actual recession I'd expect more layoffs from the same companies.

Because opportunity cost of expanding into larger markets more quickly was worth the inefficiency until interest rates went up.

Senior Twitter engineer Siru Murugesan claimed that he only worked four hours per week and acted as though this were not at all uncommon.

He also bluntly stated that Twitter was not concerned with being a profitable business venture, as they were not capitalists but socialists (his words).

This was backed up by "Lead Client Partner" Alex Martinez, who stated that Twitter's focus on being ideologically driven led to them becoming unprofitable.

Unless Twitter's culture of unprofitability and dead weight employment programs is unique in SV, perhaps other companies in midst of layoffs have similar reasons as did the new Twitter owner.

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