Dropbox announces 20% global workforce reduction
blog.dropbox.com
blog.dropbox.com
- The market for talent is competitive. So companies bid up to the absolute max they can - The market for managers is also competitive. Creating dynamics that lead to larger teams and raises for team members - Companies allow things like remote work, which is a perk, but also has a lot of abuse in terms of how much work gets done
The end result is that if companies are spending their max, if there's a shock to the market/system etc they have to cut. You'd see this less if there was more padding/ less competitive pressure/lower salaries.
I think that's fine and the system is working as intended. People should be freed up to move to other roles where they can be productive. Your manager doesn't get upset when you leave, bit weird how people feel so differently when they get fired.
The issue is not that you're getting fired. The issue is that healthcare is attached to employment, that makes zero sense. There should also be some reasonable government provided safety net so people can reskill/learn and move to other fields.
The more fiscally conservative option is to only borrow money if you have capital which is earning income at a higher rate than the mortgage. This probably necessitates having more capital than the house costs.
House prices are unaffordable because people take on loans they can’t afford. This reinforces the unaffordable prices. If milk was $40.00 a gallon you’d just stop putting it on cereal and eventually farmers get the message. Houses are the same thing.
If you can’t comfortably afford a house then don’t buy it. You’re stuck renting or buying something more modest. This isn’t complicated.
The idea that house prices can only go up is delusional. Nothing about a house is uniquely inflation proof or even inflation resistant. This isn’t the only investment vehicle available to you.
This idea that houses are an important part of financial security is putting the cart in front of the horse. It leads to the NIMBYism that prevents additional supply from being built because prices must always go up.
We all exist in the same economy and no action happens in a vacuum. When you buy something you have reduced supply and applied upward pressure on price. Individually this effect is so small it is immeasurable. In aggregate it isn’t.
Which should have been a lesson, but five years later, housing prices recovered and ballooned. I don't know why besides increased demand and reduced availability, clearly people can still get mortgages despite the lessons learned from the crisis.
Even in Seattle, $800k would get you a decent starter home.
(I chose $2.5k, bc 15 years ago out of college, that’s how much I saved living in GA on a $70k salary). I saved even more when I move to California in my mid 20s.
Also I think it's pretty rare for people to have the mental fortitude to save 2.5k a month for a house on top of living expenses, rent, and trying to build your retirement / savings / emergency fund.
It's definitely possible but I think it's out of reach for the average person.
No, it isn’t. You can invest your savings. If you had put $2,500.00 a month into SPY500 since October 2009 (15 years ago) you’d have $1,388,302.13 today.
https://dqydj.com/sp-500-periodic-reinvestment-calculator-di...
> Also I think it's pretty rare for people to have the mental fortitude to save 2.5k a month for a house on top of living expenses, rent, and trying to build your retirement / savings / emergency fund.
How is saving for a house “on top of” literally “saving”? If you can save for retirement, savings, and emergencies then you have the mental fortitude to save for a house. People are bad with money, we know that. One of the best examples is buying a house they can’t afford.
> It's definitely possible but I think it's out of reach for the average person.
Yes, agree.
> So how does one buy a house without being dependent on cash flow?
The answer to which is “you don’t”.
Most people can’t afford to buy a house and never will. Even many homeowners.
I will spell it out if it isn’t already clear.
Live within your means and save as much as you can, investing that savings in a diversified portfolio. Buy a home only when your savings allow for it.
Most homes in America are owned by the person who lives there.
That rate is higher now than in the 50s, 60s, 70s, 80s or 90s. It rofl stomps the pre-war era.
The census also collects data on the subject https://www.census.gov/data/tables/time-series/dec/coh-owner....
If that's even in the ballpark we're going to see a lot of assets aquired by insurance and hospitals to pay off the final years and this residential ownershio will torpeo.
In general terms the oldest cohort has steadily advanced in home ownership (I’d guess due to our welfare for the aged that isn’t needs based and better old age health, not land gifts but who knows). So there is definitely a trend of the oldest age cohort increasing its homeownership % while the other cohorts decrease.
But for the under 35 crowd today, they own their own home at a higher percentage than boomers or gen x did when they were in that cohort.
There is also the consideration that the US is just older than it’s ever been. I’m not a demographer do I have no idea how that plays out.
The post-war era has seen only minor changes in homeownership rates. And those tend to be around macro economic events like 2008 and Covid (and the Reagan era mortgage rates woof).
Importantly the quality of the housing was in many cases horrendous.
If you can’t retire or pay medical expenses or maintain your physical and emotional wellbeing because you spent money on a house then you couldn’t afford it. Owning a house doesn’t mean you can pay the property taxes or maintenance costs.
My point is that people are making financially unsound home buying purchases.
Another way to say this is that Bugatti doesn’t sell Veyrons to people with $1,000,000.00. Bugatti sells Veyrons to people with an extra $1,000,000.00.
It's expensive being poor and the job market isn't getting better to compensate this economy. If you rent forever you spend more than someone paying off a mortgage (only amortized by needing to upkeep the house youself). If you're wokrking your back out everyday you're more likely to pay more insurance and medical bills than the cushy white collar job with proggresion options.
Most people don't even have the $1000 rainy day fund. They are 3 steps removed from the thought of a "diversified portfolio".
I have a “cushy white collar job” and I can’t afford a house. Prices are absurd. I can make mortgage payments but it would destroy any other savings. Buying a house when poor isn’t a smart financial move.
I wish everyone could afford a house but that’s not the world we live in. Nothing will change until people wake up and stop killing themselves to inflate home prices.
Median home price in the US peaked at $479,500.00 in 2022. By Q3 2023 it was down to $431,000.00. In Q3 2024 we reached $420,000.00.
But even using the index numbers it isn’t hard to see that housing prices do in fact go both up and down.
If we are considering kids, presumably there is another partner (and income) to be added to the equation. While you may have half the amount saved due to the cost of raising children, your partner would have the other half.
8% was chosen to discount 3% inflation (cost of living) from SnP 500’s average 11% growth.
Using [3] October 2009 to present gives an annualized return of 13.763% and going back 20 years to include the great recession returns 12.06%.
Post-tax current-day value scenarios:
Starting in 2004 (20Y):
$500.00/mo: $418,349.29
$2,500.00/mo: $2,091,746.42
$500.00/mo: $252,413.58
$2,500.00/mo: $1,262,067.88
[2]: https://dqydj.com/sp-500-return-calculator/
[3]: https://dqydj.com/sp-500-periodic-reinvestment-calculator-di...
I don't know of any lower-risk and higher-interest alternative to the 30-years-fixed that is currently offered to US consumers, and based of the above answer, neither do you.
What savings account do you have? Even the best HYSA's I've seen in the '10's is 4%
I suppose if you're really confident in your monopoly money you can do it.
OK, and how does that work when houses appreciate at 9%?
How are housing prices in the neighbouring countries?
When you said 600K, did you mean NZ dollars or US dollars? If the former that would be about 360K USD.
On a median NZ income of NZ60K per year, that’s indeed rough.
Top 3 worst affordable according to claude.ai, behind Hong Kong and South Korea. The most affordable housing countries are USA, Germany and Ireland
Maybe Edmonton, and in not great parts. The parts that give it the reputation as "Stabmonton".
Rural is a different story -- seen some damn nice places for $300-400k CAD -- but rural Canada has its own challenges.
Sadly it seems it's unlikely they'll hire you even though they might need the help that bad because they're afraid of paying to train you and then you leaving once something better, and in your line of work, comes along.
And no, 1k a month is under minimum wage in my state. It's not even covering my mortgage, which is much cheaper than rent.
The job market is doing just fine, unless you’re in very specific areas such as the automotive industry or certain types of manufacturing.
[0] https://www.npr.org/2024/10/04/nx-s1-5140039/labor-market-jo...
I believe they also count gigs. So I could run Doordash for under minimum and be "employed" technically.
The other dangerous thing is "averages". This is one of the special cases where you need to look at the lower quartiles. The average/median can look great, but if we have an entire quartile unable to pay rent we'd be in trouble as a whole.
You can click through to the BLS survey to read more about their methodology, but the job growth number of +254k jobs in September only includes payroll employees. And reading the report would tell you that they do, in fact, track underemployment (people who worked part time but would have preferred full time employment). And neither job growth nor the unemployment rate has anything to do with “averages.”
Can you provide any data to refute the numbers I shared? Because again, the job market is looking pretty good to me.
This is why everyone hates economists. They have zero insight into how lives are for ordinary people. I applied for a job at grocery stores and fast food restaurants. I did not get ONE call back from any of these places.
Also another thing -- they keep saying rate of inflation is now under control. Well guess what, the prices went up and have not come down. Wages did not keep pace with the high rate of inflation so unless you can have negative inflation somehow, there is still constant pain every day, every month. I mean it is so obvious and yet economists chase spherical cows...
I understand your frustration with your personal situation, but at least regarding unemployment, how else would you propose we measure it? Unless there's some flaw with the methodology or the data that was collected, your situation is very clearly not the norm. Until we identify any possible problems with the measuring process, the number that's released is the best view we have of the employment situation nationwide. Are you saying that "ordinary people" are somehow excluded from the data? Or what?
> Also another thing -- they keep saying rate of inflation is now under control. Well guess what, the prices went up and have not come down. Wages did not keep pace with the high rate of inflation so unless you can have negative inflation somehow, there is still constant pain every day, every month. I mean it is so obvious and yet economists chase spherical cows...
The rate of inflation is under control, and I realize you might know better and are just speaking for "the average person," but comments like this reflect a gross misunderstanding of the concept of inflation. This is a perfect reason why education is so important to an informed and effective electorate.
BTW, you can, in fact, have negative inflation, and it is widely considered to be bad, for a multitude of reasons. [0]
> The rate of inflation is under control
Stop saying that because that message is clearly not resonating with people. They don't understand and they don't want to understand. Don't shoot the messenger here but this is a spherical cow. It doesn't matter that a car that has you pinned against a wall is no longer accelerating but it is merely attempting to crush you at a steady, cruising speed.
Yes, this was a big achievement and clearly we failed to communicate this message because the next question is ok great but how do I stretch my paycheck to meet my expenses.
And that goes back to the original problem -- there are fewer jobs than there were before. I have ZERO data to back this up but just my own personal anecdotes but it feels like at least for web developers that companies are laying off people AND hiring people back at lower wages. If they are not actively laying off, they are taking any excuse they can get to end a contract or "return to office" to force people to quit and come back at a lower salary.
I’m not a politician running for office, so fortunately I don’t have to make it resonate with people. I will continue to say it because it’s true.
> And that goes back to the original problem -- there are fewer jobs than there were before. I have ZERO data to back this up but just my own personal anecdotes but it feels like at least for web developers that companies are laying off people AND hiring people back at lower wages.
I prefer to believe things that are based on data and evidence rather than feelings, even if it goes against whatever preconceived notions I may have.
Here’s an anecdote for you: I’m a developer and found a new job about 2 years ago, after the big tech layoffs started happening, and went from starting my search to offer signed in about 5 weeks, give or take. I still work for this same company and since the whole company is fully remote, there are going to be no RTO mandates, ever. I make more money than I have at any previous job in my prior 20 years in the profession. I have several close friends in similar positions as me. The job market is doing great!
What do we do now?
I am happy for you. I know people use this kind of as a backhanded way like "bless your soul" in Texas but I really mean it. I am happy for you.
I hope I can get there as well. T_T
I find it hard to believe you can flip enough burgers to pay that mortgage and still survive. Not many fast food places will pay over 30 hours a week to burger flippers. Managers yes. You would barely survive.
To keep a $1,400 within the 28/36 rule [1] you need to make $60,000 a year. That's around the median wage for a fast-food manager [2].
[1] https://www.investopedia.com/terms/t/twenty-eight-thirty-six...
[2] https://www.glassdoor.com/Salaries/fast-food-manager-salary-...
like it's not an amazingly complex job, but you can't just hire some rube off the street because he had a CS degree and knows a bunch of node.
I'm guessing remote work, or a high position in the midwest or some other place?
In SF/Seattle/NYC, 250K is not enough for a studio apartment.
The term itself sounds absurd and oxymoronic to me, but also I know NYC housing is absurd and I can imagine that there are places that do nice interior finishes on studio apartments and call them luxury so maybe it's real?
But most of history relied on a labor market focusing on retention and training. We're far past that. We're a gig econnomy in all but name with these kinds of evonomic swings.
You can't eat cash either. If "can I eat it" is your metric, buy army rations.
My financial teachings were always emergency fund -> 3-6 months of savings immediately accessible -> consider stocks (hire a financial planner if you don't know stocks) -> consider asset management. your first foray into saving if you're barely spacing by isn't to rely on the S&P 500.
You can't eat cash either. If "can I eat it" is your asset metric, buy long-lasting preserved foods.
That's why a budget is necessary, and you plan for emergency (of which a layoff is one). Saving up for an emergency fund means you don't spend on luxury until it is saved, which means no broadway or restaurants (unless you're super highly paid, in which case it'd be quite fast).
The restaurants and broadway shows are gone.
I’m all for spending on experiences btw. But you have it backwards financially.
And selling your house is a last resort. rent is still more than mortgageso you're losing both asset and liquid wealth with that move just to buy some time. You're better off taking out a second mortgage if needed than selling off entirely.
...not to mention that if you're losing your job and can't find a new one readily, chances are you're in an economic calamity and you'll be selling near the bottom.
Getting fired/laid off is about the only thing that can save you.
Maybe disappear into the woods, or change countries. Or self delete.
That said, I think it is a pretty bad idea. Use of public funds dont increase with property value, it just means you have deeper pockets. I would be more in favor of flat taxes on homes independent of value, so people pay their fair share for community resources consumed.
Or tiny homes like the luxury single occupant container buildings on a bit of land?
Tiny homes are not the solution, they are hipster semi-cottage-core fashion homes. You're probably thinking of regular apartments, but for some reason they aren't built at the rate needed. Build ten million apartments (for starters) and the cost of living will go down. Satisfy / saturate the market first, then think of gentrifying with fashion homes.
crabs in a bucket. Those who got in and got theirs don't want their property value falling. Americans treating housing as a stock instead of a necessary resource for living really ruined a lot of the dynamic of city planning.
One main fault in the analogy is that in an economic crisis, there is a vicious cycle of income loss which leads to lower demand leading to more lost jobs. This coordination failure can be handled by fiscal/monetary policy. Whereas server failure, even when widespread due to a virus doesn't happen recursively like that.
That doesn't seem the least bit weird to me. If I choose to leave a job (or relationship), I could quite sensibly feel differently if that same job (or relationship) chooses to leave me.
Really? You think its weird that someone leaving impacts that person more than their manager, team, or company?
A manager doesn't care that you leave because he still gets to bring home a salary, all they have to do is hire another person and maybe cut back on scope for a little while. When someone is layed off or fired they have to go find a new job, their income streams dry up, and are forced to rely on savings. People often have long term financial commitments they cannot back out of, and not knowing how you'll make rent, if you can afford your child's school fees, or even maybe having to cut back on how much you eat, _is stressful_ and emotionally taxing.
Are you fucking kidding me? "Which is a bit weird" I'll tell you what's weird: management who doesn't understand that their employees rely on them more than they rely on the employee.
Of course its fine when someone chooses to leave their job, they've made contingencies and planned around it. Whether it's through savings, another job, or the lottery, people have at least some idea of their plan when they leave a job.
Yeah, I'm curious how someone can have an opinions on workplaces and workers and not seem to have personal experience with the subject, especially in a community like this.
Do they just come from a wealthy family so the stance is "Getting fired isn't a big deal, just ask your dad to cover expenses until your next job."?
I can't imagine living with only 6 months of savings. There's no guarantee that I could find another job in 6 months, and unexpected expenses (medical, car trouble, housing repairs) can easily wipe out a month of savings anyway. In fact, given that a layoff means likely also an economic downturn, finding a job at the same salary within 6 months seems highly unlikely.
I have probably 3 years of no-risk savings at this point, have managed to reduce my living expenses to the point where I could work a 40-hour minimum wage job and still pay for my expenses, and have multiple back-up careers, and I'm only now starting to feel that taking money out of savings is an acceptable risk. That took years of frugal living on a high tech salary. People in their first few years at a tech job or with families will probably never achieve that.
> Please tell us briefly about your background.
> I grew up in the Netherlands, and I was interested in technology from a young age. I started a gaming website when I was 13. Later, I attended Erasmus University Rotterdam before founding Fashiolista, my first startup and an early social network similar to Pinterest. It grew to millions of users...
I'm sure people making >200k/year and getting a 4 month severance package will be cutting back on how much they eat.
What you say is true about low or even medium income jobs. But most of the cuts are to tech workers and their managers, ie. people best equipped to manage in this kind of event.
I agree they should be in a better position because of their income, and I'd say more than an average amount are. But there are still a lot of people in that bracket who absolutely would have the floor pulled out from under them.
People are often caught with their pants down assuming the good times will keep rolling. And even when they see the market downturn or have a generous severance, it still can be very difficult to scrape together the 6+ months emergency fund required on short notice.
Meanwhile if you've lived an easy life you may not have learned how to cope when the hard times come.
Also your estimation of HN users is probably out of date with the current state of the employment market.
[1] https://help.glassdoor.com/s/article/Tips-on-writing-a-revie...
> your estimation of HN users is probably out of date with the current state of the employment market
You're probably not around start-ups if layoffs are a top concern.
Well yes. If you're at a startup you should assume you're always a few months from being laid off. Everyone should assume that. You're fighing to survive; the default is dead.
Dropbox, on the other hand, is not a start-up. It's had to file WARN notices [1]. "Nobody can do a background check on a company to see who they laid off or fired before they work there" is false.
It’s one thing to be laid off from a startup in general. Another entirely to be laid off right now.
The number of recent layoffs is everyone’s concern right now because of how hard it will be for you to find a job afterward. Layoffs always were going on, and always will for startups, but the days of turning down job offers due to small uncertainties are mostly paused or gone at this point. The demand crunch is very real.
What? I don't want you to know when I was fired and why. Employment reports typically don't contain the why either because that's litigation bait.
We're talking about the information asymmetry in hiring and firing. Why does knowing the titles and time periods of those laid off in the past help you estimate your lay-off odds in the future?
>Why does knowing the titles and time periods of those laid off in the past help you estimate your lay-off odds in the future?
I don't know. Why does knowing my titles and time period help businesses judge how useful I'll be for this new position? It's the same issue but that's where the asymmetry is. People seem fine with big business being able to do that but not prospective employees who may care about retention rates.
But to answer your question: retentions rates let me know how hard the company will try to keep me during bad/down times. Someone who can't even retain for 2 years probably has smoke.
And the changes were the part of a system wide (civilization wide ?) response.
Someone has to take the garbage, and be paid for it.
If the job isn’t attracting workers, than by market logic the pay should be increased.
If the pay is being kept artificially low though, then there is inefficiency in the system.
What are you talking about? real (ie. inflation adjusted) wages have gone up more for the lowest quartile of americans[1]. Is paying people more to get them to work "re-enslavement" now?
[1] https://www.atlantafed.org/chcs/wage-growth-tracker, click the "wage level" button
Too many focus on equal outcome instead of equal opportuniy.
A rule applying across the board to everyone doesn't really imply that it provides equal opportunity.
Equal opportunity, not equal outcome.
> high tech salaries
Just the other day I clicked on the website of some random law firm's career page. I wasn't happy with what I saw (in the context of my own career). Some researchers with 1 year of experience with starting salary of 450k+... tech salaries look high as long as you don't check other professions.
A lot of tech roles are intellectually stimulating and have a wage in the upper distribution of salaries. I think we have a very nice situation going for us.
Tech is high earning. It gets beat out by high finance and partner-level roles in e.g. law though. If someone is earning 450k in their first year it's probably similar to a quant finance role.
This is just one random firm that I picked from google: [0] - $235k - $365 - with 1 full year of experience, lol [1] - $310k - $390 - real estate contracts [2] - $260k - $390 - real estate contracts, with 2 years of experience
Can you get $350k+ in tech? Well, yes, but with including a lot of luck and ifs. Can you get $350k+ in tech with 1 year of experience? Realistically, only if your dad is called Nadella or Musk.
There are definitely jobs that pay much worse than tech, no question about it. And if you are happy with your salary, than good for you. But nowadays people are mostly made to believe that tech salaries are still extraordinary.
Looking at the best paying professions[3], tech makes only the very end of the list (and only manager level, not code-droid level).
[0]: https://jobs.phextranet.com/PH-Attorney/viRecruitSelfApply/R... [1]: https://jobs.phextranet.com/PH-Attorney/viRecruitSelfApply/R... [2]: https://jobs.phextranet.com/PH-Attorney/viRecruitSelfApply/R... [3]: https://www.investopedia.com/personal-finance/top-highest-pa...
The first role is a 2nd-5th year associate. $235k is for a 2nd year associate, $365k is for a 5th year associate. Each year they get a predefined pay bump. Third role is the same kind of thing (3rd-6th year associate), second role it says mid-level so not 1 YOE.
This firm is also a Big Law firm, the equivalent of FAANG, if not harder to get into. Notice how law is not on your list of top paying professions. Most lawyers are not super well paid.
Also, being an associate is not like being fresh into tech. I don't think it's like a tech new grad role. Average TC for an entry level SWE at Google is ~$200k, and you can be making that as a new grad. Average senior comp is ~$400k, and it's possible to reach that level in 5-7yrs.
Entry level: https://www.levels.fyi/companies/google/salaries/software-en...
Senior: https://www.levels.fyi/companies/google/salaries/software-en...
Another thing to consider is hours. You will work so many more hours as a lawyer in Big Law than a SWE at FAANG.
Tech workers have it very good. Relatively high pay with relatively low hours. Higher comp professions have much higher barriers to entry and work much longer hours.
Do you have any evidence of this? There are unfounded claims of “productivity metrics” but I have never actually seen one.
E: I realize this is a poor choice of words after saying productivity metrics don’t exist. What I mean is my tasks are easier to complete in a WFH environment than they are in an office.
I have been far more productive from home. The constraints around communication necessitate effective documentation which enables asynchronous communication which alleviates scheduling challenges which improves delivery.
Maybe managers need to go in to the office to rub elbows but ICs definitely don’t.
Same. It's been a boon for me, and I genuinely enjoy my work, so it's win win. But anecdotally, I know people who abuse it.
On net, remote work is a plus: less commute, less pollution etc etc. And even the abusers, it's not like those people were highly productive in the office, I'm sure.
If you can't tell remote employees are slacking then you also can't tell if they are slacking in the office, you are just getting fooled by thinking presence implies work.
So tired of hearing this "argument".
There is, it's called Medicaid.
Not a single person in the US is denied healthcare based on inability to pay.
Yes, because that's the law. Then they hand you an exorbitant bill on the way out, which you can't pay. Then you get hounded by collections. Then your credit score tanks. etc. etc. etc.
Not everything is a direct line, the end result is the same.
This is not true. Emergency rooms are required to take you in and stabilize your situation even if you can't pay. Everything else is not available if you can't pay.
Think of something like cancer, which an emergency room can't treat since it develops over time. You will indeed be left to die on the streets if you don't have the money or coverage from somewhere.
I shouldn't have to sell my house to get medical care.
That's because people have a single employer, while companies have several employees.
That's also why employees are protected, while companies are mostly not. And yeah, the US doubles down on the problem by linking health insurance with the job.
Do you mind expanding on this? How does remote work change the standards of how much work somebody has to get down?
When you leave, your manager loses 1/N of team productivity. When you get fired, you lose 100% of your income.
I bet the manager would be more upset if the entire team quit. But even then, they'd still have their job—for a while, at least.
I do understand that it can be challenging to save for young people with student debt starting out in a HCOL area. But I see older tech workers who ought to know better buying luxury cars and fancy gaming PCs and taking exotic vacations. Good luck to them when the next recession hits.
Yes, but the problems start in severe economic crises. Specifically, when those several months turn into years.
Many filters during the hiring process, prior to interview will discard those candidates who have gaps since last employment regardless of circumstance. They may use AI as a third-party company to review and obscure the fact that they aren't hiring anyone over 40, female, or otherwise protected classes but that is what is happening regularly, along with other elements such as degrees being weighted higher than experience algorithmically.
> I do understand ...
I can tell you from personal experience, this opinion of yours isn't reflective of the whole. I've been in Tech for a decade, I was unlucky and was laid off before the major lay offs (2022) as I was involved in workforce reduction for a buyout merger. I've been looking ever since, and I've had to find work elsewhere in the interim once my reserves were expended.
I was extremely frugal, cooking everything myself, nothing luxurious. Inflation destroyed my reserves, the lack of jobs forced me to look wider than my given profession since there are no jobs, and I had more saved than most (>50k in liquid reserves at the start).
This isn't some recession like before. This is a great depression, potentially a big debt crises like Germany pre-WW2.
70% of my professional network in IT/Tech right now, across the board, is out of work. I'll let that sink in. 70%.
We are at peak hiring for seasonal hiring and unemployment is 7.0% in August? Hiring freezes guarantee this will be double digits by the annual count. National unemployment is 1.5%. That's a 4.6x national distortion between the national average unemployment and one sector that impacts everything else as a labor multiplier, and that measurement only counts those currently getting unemployment, any long-term displacement outside 18 weeks isn't counted.
Its looking more like we're in the middle of an economic collapse, which makes sense if you know about ponzi's, economics of boom-bust cycles, and how we are entering a bust cycle related to the petrodollar agreement abandonment (by the Saudi's); all those dollars printed for abroad use are now flowing back to compete with the same goods despite high interest rates.
BRICS largely isn't about attacking the US economically, its about sheltering from the global economic fallout of fiat money printing, for more than half a century. The bankers are and have been doing this to us since before we were born, and this happens every time large fractions of global assets get concentrated into few hands. Its cyclical. Large market-share companies are funded by preferential loans made by those same bankers. This is how you sieve wealth and marketshare, then drive prices up, and eventually end in deflation or hyper-inflationary collapse, because unlike normal systems economics is both sticky psychologically, and mathematically chaotic (3-body-problem).
There is no beautiful deleveraging, the bill always comes due. If this worsens, and I don't see how it cannot, this will be known by the survivors as the folly of one big generation.
No, it's not even close. Unemployment in 1933 was 25%.
Unemployment calculations from data recorded during that time have since changed. The same unemployment numbers are not the same mathematical objects being compared.
At this point, we can never know the true scope of unemployment to make any comparison definitively, because the measurements no longer accurately collect the necessary information for such a comparison.
You don't see engineers turn sampling data into an average rate of change, and then use it for safety-critical applications that require instantaneous rates of change.
In my previous response, I said unemployment today isn't counted after 18 weeks, so you should be aware that these objects are not the same.
Just because you have no visibility on a problem doesn't mean there isn't a problem especially when objective measures indicate there is a problem.
No definitive comparison can be made objectively, claiming its not even close would involve delusion when no external objective comparison can be made, definitionally.
We can look at the number of people on payrolls and the number of people claiming unemployment.
You are in a deep tech bubble if you think we're in a recession let alone depression. (What we are in is a cost of living crisis.)
Depressions typically have stagnant growth, starting in one sector, and expanding; with no prospects and a duration that can last years (plural). You can have a depression where everyone says they are hiring, but no hiring actually occurs.
Cost of living crises naturally occur during the latter crises given the chaotic nature of deflationary and inflationary forces (money-printing). They are not mutually exclusive.
Payroll data collection has problems with accuracy, people claiming unemployment also have data collection problems. Its not uncommon for the government to withhold unemployment benefit approval until some arbitrary bureacratic requirement is met with no means to contact someone to resolve it timely. I know several people who received their 18 month unemployment effectively as a lump sum and they spent days of labor trying to overcome those hurdles.
This causes a delay of action, and bursts in time (temporally) which cannot be compared except as an average. Revisions are subject to problems too.
There absolutely is. A slowdown in growth is not a recession.
Even in IT circles, it's still better out there than it was during the GFC (2009, 10% US unemployment), and way better than it was after the dot-com bust (2000, <6% overall unemployment, but much, much higher in IT).
BRICs isn't even a real thing, it's a total joke. They've been talking about an alternative reserve currency for years but have made zero real progress.
Something uncommmon for Gen X and unthinkable for Boomers. But think about how modern America structured all these payment plans...
>This is why people working in volatile industries subject to boom/bust cycles
you just said everyone get fired. I think today it's harder to find a job that isn't on bust/boom. Especially a public company that will slash employees simply to make number go up, no even because they are struggling per se.
>several months of living expenses (including health insurance premiums) in low-risk, liquid investments.
Low risk invesements are talking 2% on a great day and 4% on an excellent day. There were people above talking about 8% interest rates from S&P to outrun inflation long term.
>But I see older tech workers who ought to know better buying luxury cars and fancy gaming PCs and taking exotic vacations.
odd we compare a 6 figure luxury car to what's at best some $5k gaming setup that can in fact be used for more work in this tech sector. my 2.5K laptop was probably a better investment pre-bust than my new bed (I guess we'll see in 20 years with my back, but the bed isn't making me money).
https://fred.stlouisfed.org/series/UNRATE
Current money market rates are above 4%. So I guess today is a really excellent day!
You should bring a chart on the average tenure at a single company.
Put simply, these kinds of things are going to keep happening until our wealthiest (individuals/families/companies) are a lot less rich.
A couple months ago interviewing.io posted something bragging about how "we do anonymous mock interviews. If people perform well in those interviews, they get introduced directly to a decision-maker at top-tier companies, regardless of how they look on paper." ( https://interviewing.io/blog/i-love-meritocracy-but-all-the-... )
This annoyed me enough that I sent in an email complaining that their introduction process specifically notes that I am not eligible for anything, despite performance measured by the site as "highest ever achieved: 94th percentile" (so, knock that down a bit for being a high water mark), because of an insufficient number of years of experience.
They responded:
> It really sucks, especially in this market, but this policy is a function of us having tried for years to get companies to take junior intros, and it didn't work. We offered to do it completely for free, too, fwiw, and no dice.
How competitive is the market for talent? Let's stipulate that, because of a lack of prior employment, I'm not qualified to have a job. How exactly would that situation change?
Clarification: Just because companies don't want a 3rd party like us providing them with junior candidates, it doesn't mean they don't want them. Even back in 2017-2019, when the market was booming, we couldn't get employers to take our juniors... because they generally have their own robust pipeline.
So the solution is to go to companies directly, rather than relying on a 3rd party service like ours, which companies tend to use specifically for roles they can't fill on their own.
You seem to be confirming that the market for talent isn't competitive - in your view, companies have more applications than they want.
Or maybe you're going for a different point? For the suggestion, my experience is that companies won't consider direct applications either, and in the general case do not ever even list junior positions. (An observation which is not unique to me; see e.g. https://marginalrevolution.com/marginalrevolution/2022/07/fr... )
If you're worried that I'm implicitly slamming interviewing.io for claiming to do something very different than what they actually do, I don't think you've rebutted that - "if people perform well in our interviews, we will introduce them to top-tier companies as long as we think their resume looks good" isn't particularly similar to "if people perform well in our interviews, we will introduce them to top-tier companies, regardless of how they look on paper".
The point I was making is that even though companies don't want to hire juniors through us, they still DO WANT to hire juniors in the absolute. So junior hiring isn't dead.
Here, saying "the market for talent is competitive" clearly means that hirers are competing with each other over potential employees. Deciding that you already have too many potential employees is the opposite of that. It would mean that the market to sell talent is competitive, which isn't what was claimed.
How is this weird? Your take is like the famous saying about the chicken and the pig both contributing equally to the egg and ham sandwich.
The market has been slowly shrinking into fewer and fewer hands over time, which is why it has become more competitive over time. This has also led to cooperative behavior among the large marketshare companies in the sectors to disadvantage competitors, and employees.
Companies do not bid up to the max they can, because the executives take their cut first. The companies bids can only ever be the max of what is left after that, and varies by the greed of those people.
Interest rates would be the shock you described, but Tech unemployment as far as I can tell has until now been bulletproof, and uncorrelated with interest rate rises or falls. Its not rational to assume this market shock is a result of interest rates, AI is the only competitive alternative.
The issue is not that you're getting fired. Its that you can no longer get base goods needed for survival arbitrarily and without notice, and without capital reserves which are finite you are living on the street.
When the entire market as an entirety is contracting, there are no new jobs to move to in other fields.
Worse, the concentrated market is naturally incentivized to impose high costs on any job seekers to interfere in labor relations to create barriers to entry for competitors while suppressing wages for prospective workers.
This natural progression occurs when anti-trust fails, and money printing makes it worse potentially leading to either deflation (a collapse to non-market socialism) or hyper-inflation (a collapse to non-market socialism). Debt issued as preferential loans from a money-printer makes a company state-dependent/controlled apparatus even if its claim is that it is held privately.
The economy today is worse than 2008, much worse then the dotcom bust, and if you plot the trend with good data going back and starting around the 1970s, the trend shows progressive ruin as time passes, with seiving and consolidation occurring regularly. That is the force driving this problem, and it doesn't enable tech salaries.
> There should also be some reasonable government provided safety net so people can reskill/learn.
There is a limit to what government can provide, it takes awhile to get to those limits (we're in a super-cycle going back to the 1920s) but we'll be there in the next 5-10 years thanks in large part to deficit spending and the FED picking winners and losers.
The main issues with academia also applies to government. They are structurally the same. Education today is not about learning skills, that is always secondary to instilling the qualities a loyal unthinking worker. That is what the entire prussian-model of schooling is about (which is what we have in this country).
These structures for training follow the same structure as guild socialism, and the same intractable failures (ref Mises for related details).
It inevitably ends up being a cult of qualification, where you are automatically considered unqualified without a piece of paper even if you have the actual skills to do the job. Once a target market size is identified and reached, new candidates are put on an endless escalator of suffering with arbitrary filters/requirements where the claimed outcome is nothing but an unobtainable pipe dream.
It's weird that the average person working these jobs has bills to pay, and perhaps additional family members to care for?
No the issue is that I get fired after the prior townhall saying "we are not doing layoffs". Companies will outright lie to get little ounces of productivity and treat you like a criminal the moment they break the news, as if we're all school shooters waiting to happen in anger and rage over betrayal.
The circus of the 2023/2024 job market doesn't help either. Even pre-pandemic the process was padded, but now I'm not even convinced 80% of companies have a human reading my resume.
>There should also be some reasonable government provided safety net so people can reskill/learn and move to other fields.
I'd rather not "hit hard times" while shareholders are making a killing and make a conclustion that my entire career needs to shuffle so they can save pennies.
Somehow overhiring and maintaining said headcount long enough to need to do a 20% cut is probably less commendable, but not exactly an outlier there in the current climate.
I've always wondered about all these standalone "point solution" companies and how durable the model is. In the current climate of reduce M&A, and cost consciousness there is no one to sell to. And as the big platforms - AWS, Azure, GCP continue to grow.. it strikes me that more big companies would rather have a one-stop shop full of 80% solutions than pay for 100 different SaaS.
This kind of no-win complaining is tiresome.
Does it suck? It means that someone got a job where they didn't really have to do that much and got paid anyway.
An alternative is where that job was never offered. And then we're complaining that there's no jobs.
Also, no, the solution is not to "just hire the perfect amount". Sure if we could just do anything perfectly everything is great, but how is that a reasonable demand.
Source?
All you are arguing for is that Dropbox should never have hired these people in the first place. Why is that better? At least these people got some years of high pay, experience, networking relationships, etc. Obviously it's disruptive, and it could be a big net negative for people who maybe jumped ship from more stable jobs only to be quickly laid off, but that's not the broad experience.
Also, you're missing another obvious argument. Most tech companies that are doing layoffs could afford to keep their employees. Dropbox hasn't done 3 rounds of layoffs because they're on the verge of bankruptcy but rather they're just following the trend and pleasing shareholders or whatever.
So I'm not arguing for less jobs but rather less corporate bullshit.
How do you expect this to work? Companies hire because they think the extra man-hours is going to give them a competitive advantage. Companies agreeing not to compete each other seems suspiciously like a cartel.
That's still cartel behavior. If Google and Apple formed a cartel to fix handset prices, they could still theoretically compete with each other on features or whatever, but that'd still be a cartel.
Claiming that it’s to please regulators when it’s far and away better than the average severance package is an irrational claim.
16% in 2023: https://blog.dropbox.com/topics/company/a-message-from-drew
Or, before that, another 11%: https://dropbox.gcs-web.com/node/8916/html
I wish them well, things look rough.
Strongly agree (unfortunately I might add, because I'm not a fan of "the big just keep getting bigger). When it comes to data management, tons of companies are really concerned about access controls, policies and DLP (data loss prevention). In my experience setting up these policies and rules correctly, and appropriately monitoring them, is very difficult and easy to get wrong (many data breaches are a consequence of this). This is especially common when you need to bidirectionally share content with third parties, you may want to give some of those parties access control rights on some data buckets, etc.
I was at a previous company where we were essentially all on Google Workspace. Google Drive's access controls for sharing with third parties used to really suck, though they've improved in recent years. We had teams that wanted to use Dropbox enterprise because their third party sharing features were much, much better. The problem is that I spent a ton of time learning all of the access control and management policies in Google Drive (which aren't great, mind you), and then I needed to spend another large amount of time learning an entirely different interface and set of rules for Dropbox. I almost had a breach because a checkbox buried down somewhere was checked incorrectly. Also, adding Dropbox meant I had a host of additional SOC 2 compliance checks that I needed to validate.
Meanwhile, sharing features in Google Drive (of Google Workspace) have largely gotten "good enough", as of the past couple years.
Meanwhile, every single desktop OS, mobile OS and cloud provider basically has had this functionality in some form for maybe 10 years now.
If you are a home user in Google or Apple ecosystem, its all native and seamless. If you are a corporate setup in Microsoft or Google ecosystem, its all native and seamless there as well.
Not clear what the standout features of Dropbox would be now.
I think we need another one for "An update from <company>", as this has seemingly become the standard subject to use when you're announcing layoffs or data breaches. I saw an identical headline earlier today from Sony announcing a studio closure:
https://sonyinteractive.com/en/news/blog/an-update-from-play...
These messages are obviously never going to be well received, but at least people can find comfort in the fact that it's because Dropbox is shifting direction and strategy and not because they were bad employees. Stuff like this happens in business. Maybe you've focused on private sales and want to shift to enterprise sales or fund investments at which point your company no longer needs it's sales and marketing departments because the company mission will be radically different. Changing course is a CEO taking responsibility for the company.
It is what it is.
There is no empathy whatsoever involved when someone says "I take responsibility" and then faces zero consequences. It's just a slap in the face.
If a CEO did not take full responsibility, what would be different?
Very early in my career I accidentally deleted every IP phone in the municipality where I was working. It was because they didn't have a test setup and the documentation didn't the SysAdmin gave me weren't updated. It was still my fault though and the first thing I did was to tell the IT manager thinking I'd get in trouble. I didn't. He told me he wasn't happy that I had deleted all the phones, but that it was good that I had come to him directly and taken responsibility.
Because when you take responsibility in the adult world, it means that you can work from there. As such it's both ridiculous and disingenuous when you compare a perfectly normal consequences of doing business with committing a crime. It's also a little weird to do so on HN considering this is a VC site.
Executives from these billion dollar companies would do just fine if they went a year without pay. How many laid off employees can say the same?
That would be “taking responsibility”.
People get mad because these phrases prove how wide the gap between them and executives is. How deep into capitalism we are.
Nah, screw that. So may CEOs get told by workers this is a horrible route, drive straight into a wall, then show "empathy" for their bloody nose as they throw the passengers off a cliff?
That's not empathy, that saving face.
>Stuff like this happens in business
Stupid stuff always happens. Doesn't mean we shouldn't call out stupid stuff every-time it comes up. I won't accept "it is what it is" when livliehoods are at stake.
Changing course and immediately resigning would be that.
It's a layoff. Yeah, it sucks, and no matter what the CEO says people will be pissed. Better to just take the same good advice as when starting a new relationship: "Just ignore everything they say, and only consider what they do." I.e. is the severance package good? Are folks given some assistance/recommendations finding new jobs? If so, I couldn't care less about what the preamble in the layoff announcement looks like.
It's professional passive-aggression. That's more angering than just saying "we need more money, we are laying off people". That "language" is what you're expected to do in the office half your life and it's a tiring waste of time keeping up false pleasantries.
If you don't know, look up the Umbridge effect. Sometimes the petty evils that pretend to be civil stings harder than the pure evils. Not many of us have a Voldamort in our lives. We all have an Umbridge.
Like it's probably not good for our society that people have to up end their life every few years and probably move to find a new job.
Both my parents stayed in the same job for their careers and it meant they could stay in the same place, have kids, build ties to the community, etc. Seems important if you want to not die out as a society.
My father was the same, BUT.. this is an INCREDIBLY risky thing to do career-wise in the modern era. Given how much tech advances and that we actually face international competition that a lot of our boomer parents didn't during their career, I don't see really any going back either.
Some of the worst layoff situations I've seen were guys who worked in the same company for 25 years.. long enough that their knowledge & skills was too company-specific, but not long enough to retire. Just because someone seems indispensable doesn't mean they are safe.
Having to drain savings for 1-2 years jobless after a layoff in the last 10 years of your career and reset at a probably lower salary can set back your retirement 10 years.
So it's no wonder that "some people losing their jobs and needing to move for a new one" is irrelevant, when the only goal is profit maximisation, even though we don't even understand what for.
The thing is, Dropbox is done (as in feature complete). Like when the construction of a building completes, many people are "laid off" because they aren’t needed anymore. Yeah, you need to keep some people around for things like maintaining the building, but not to the scale of the original workforce required to build it.
It is "good" that the excess labour is freed up to go work on the next "building". What may not be good is that the workers didn't think to associate with each other like construction workers do. Construction, being a much more mature industry, typically keeps a clear separation between the workers and the building so that then construction is done the entire excess group of people can be lifted on to the next project instead of all going their separate ways.
Software will undoubtedly go that way eventually. But it is, in the grand scheme of things, still early days for it as an industry. We haven't yet learned the lessons that older industries have.
We see this ad hoc in software now. When there is a mass layoff, someone will go get a new job, and then try to bring on all of their previous coworkers. Or a group will go off and start a startup which (if they're lucky) will get acquired and they get to keep working together.
Which now makes me think, if you're a big company, maybe it behooves you to offer a highly functioning team a seed round instead of individual severances...
Dropbox is "done" but Dropbox didn't employe 2700 people just to work on dropbox.
They toyed around with other services, weren't as gamebreaking as dropbox, and in hard times (not necessarily for their business) they deided to just abandon those other experients or products. This isn't some "the job is done" scenario, it's "we're hunkering down for the storm that we pretend isn't happening out loud" scenario and people are still falling for the idea that "the economy is soaring". It's disgusting.
>It is "good" that the excess labour is freed up to go work on the next "building".
sadly there is no "next building" in these times. When everyone is "feature complete", you just have a purge, not a new opportunity.
>Software will undoubtedly go that way eventually.
given the 3rd wave of attempting to outsourcce large software out, and the AI bubble, I don't think companies are ever going to truly appreciate proper mature software. Just the bare minimum to pretend the machine is running until the next CEO deals with the fire.
At one company I worked at, a whole division got laid off because the director didn't like the manager of said division.
In my experience, this is often an after-the-fact rationalization by people who "survive" layoffs to explain them, and a convenient justification by leadership for layoffs. If you've ever been in the room when layoffs are planned or discussed, the actual process is way more focused on blunt cost, personality of the people involved or on the chopping block, and is often practically a tossup considering "performance" is not really a clear or meaningful metric (actually, more often it's arbitrary for most companies --- they will find the metric they need to justify laying off someone). This phenomenon is greater the bigger the company and the more abstracted managers and leadership are from their lower level employees.
There are rationales behind it. The simplest one is that the product is matured enough so you don't need these so-called 10x engineers or seniors.
Then the lowest performers.
If the marginal product of labor is lower than the marginal cost of labor, the company should reduce headcount. If higher, the company should increase headcount.
That would require leadership to take a hard look at the value they bring to the table as well.
It's a lot easier to just lay people off than do that though, conveniently.
2640 employees seems like a ridiculous number for a company like Dropbox. I work at a company that's about half of that and you wouldn't believe how many different services this company runs and I still think there's a lot of inefficiency.
Except when the engineer leaves for a $500k postion. Companies basically moved towards this churn market in a way not as far off from an assembly line as you'd expect. They prefer some inefficiency if the cogs are easier to replace every 1-2 years.
Whether in the long term this is net-beneficial for a given actor in the typical case, is at best unclear. This marginal-labor-cost/benefit-in-a-given-moment accounting misses a large proportion of the harmful effects of a layoff.
When a bunch of companies in one sector do it, it does lower wages and reduce labor power to e.g. demand better working conditions. That part, is a benefit for companies. But it's not the result of one company doing what's best for their particular situation—it's a result of coordination, even if only by the understanding that "this is what you do, when there's an excuse to, and especially when you see others doing it". It's merely best practice then, not... collusion.
I'd hope tech workers on a community like this could empathize with other tech workers in such an environment.
It makes sense to keep some high performers and a few redundancies to stabilize/modernize it and make small improvements, but it feels like tech got really bloated with these massive corps who were trying to burn as much as they could to keep all the VC money flowing. Take like Uber having a team that built and maintained a chat app just for internal use, and every single big org having a bunch of teams responsible for various "some_dumb_name" that is the "custom X for 'Y'" where smaller teams just use the OS solutions to those problems.
This is not generally the case, except in monopoly situations.
Your software product generally has a competitor, and they're busy trying to make theirs better than yours -- whether with more features, better integrations, whatever it is.
So your staff size generally stays about the same in order to build more features desired by customers to prevent customers from switching to your competitor and you go out of business. And certain features, by themselves, can be more complex than the entire v1 of a product. And/or involve massive refactoring, etc.
The companies that get to reduce their team size are often because they're in a monopoly position, and then customers suffer because the software gets stagnant and the features they need don't get built. That's capitalism failing.
Also, something like an internal chat app isn't always a bad decision. If your company is above a certain size headcount, it can literally be cheaper to build small tools than to license them. Especially when you can more deeply customize and integrate them, which you often simply can't with off-the-shelf software.
Unless you are selling a commodity. There is a good case to be made that what Dropbox sells is a commodity.
> That's capitalism failing.
That's government failing.
1. You can't dig the moats necessary to establish a monopoly without regulation to support it.
2. If/when the government screws up, the onus is on it to fix the problem before the situation gets out of hand.
Is there? I argue Drive and OneDrive surpassed Dropbox a while ago. Box is dirt cheap if you came in early as well (I still have some 50 GB forever deal from like, 2012). And there's a dozen others if you look into it. It's not very hard to drop any one cloud storage solution (or all of them if you invest in a NAS setup).
> It's not very hard to drop any one cloud storage solution (or all of them if you invest in a NAS setup).
software can generally be 'done' in the same way building a skyscraper can be
Maybe, if the company can foresee and realistically assess the problems it's about to face, it may gradually prepare for the transition. I've seen this happen at my friend's job at Dell storage division: some storage product failed, they tried to reshuffle the teams to start working on something else, with some code reuse from the previous one. It still didn't go well, and a lot of people were still let go (because the initial effort of developing a new product cannot really accommodate an army of various kinds of extra personal that's necessary for mature product). They sort-of survived, but with a huge loss.
I think a lot of the low hanging fruit in tech has been eaten up, bought up and consolidated, or actually was recognized as much more difficult and expensive than they actually thought. The leadership talent and vision in a lot of these companies is also painfully lacking. In short, to answer your last question: probably not. And I think they're terrified that Wall Street is going to notice.
I also do agree and think leadership talent and vision in a lot tech companies is painfully lacking. This are the companies that could burn some money and use their wedge in the market to build some really cool things, but they wont. I guess to some degree, ironically, the money they're making might be part of the problem.
Tho in honesty, 500 if overkill unless you really are tapping into some multi-disciplinary project that needs experts in a dozen backgrounds.
The whole is often more than the sum of its parts. A company is not just a bunch of people, but it's also the company culture and the established ways of doing things. It's common that a company can't make something work, but the same people in another company could, because they can organize their labor in a different way.
Software development is often an investment. Hiring a developer is often an investment. Most companies eventually reach the point, where the rate of investment slows down and the company chooses to return the profits to the shareholders. When the company no longer believes that it can invest the money more profitably than the shareholders could, it's rational to lay off people working in R&D and use the profits for dividends or buybacks.
And some interesting part of this announcement is the mentioning of the grown overcomplex management. This kinda smells of some shrinking for health-benefits. For some reason or another, they grew into a wrong direction, and maybe now remove the unhealthy parts to be able to operate better.
I think I prefer the severance, the full disclosure, the opportunity to find another job and the possibility to keep teams together at a new thing.
Many of the answers in this thread have been perfectly reasonable. And I'm probably kidding myself when I think that "if I were that CEO, I'd do things differently".
At the end of the day, the american market place is distinguished in that venture capital, especially in tech, is very accessible. Being laid off seems to be a bonus in the hunt for VC money.
It's the same reason companies return dividends. Sure, they could use the money for R&D and launching a new product, or they could send the money to investors so that they can scour the marketplace for a new technology of their own choosing for investment. The first one unnecessarily takes investor money for a project they may not have signed up for, whereas the former maximizes their freedom to invest in what they find interesting
According to their financial statement, Dropbox has more liabilities than assets. So yes, they have a large cash reserve, but with an even larger debt offsetting it its hard to argue they are in a good overall financial position.
Five or 10 years ago, they were doing a lot of this. Dropbox Paper ("a collaborative online workspace that allows you to create, share, and edit documents and notes with your team") for one. It's still active but it never took off. I was just notified that there is some sort of migration taking place which is probably related to the RIF.
Neither exists anymore.
This all came about because this company had built a couple of hugely successful, and profitable, enterprise software products. So this company then decided to plow a ton of money into building out other products. The company was also pretty famous for having a high employee bar, and their college recruiting process was kind of legendary for attracting top CS and other tech grads.
However, this company discovered that building follow on successful products, even with lots of really smart people, is extremely difficult. As a not-perfect analogy, think of all the "one hit wonders" out there in the music industry. Beyond those one hit wonders, the vast majority of the rest are basically two hit wonders. Point being, once you've built a really successful product, even if you have tons of smart people, there is no guarantee that plowing money into another product will give you a positive ROI.
So this company realized this, and then saw there were a lot of other small-to-midsize software companies who were similar: they had one or two really successful products, but then were trying to use money from that to expand and grow into other areas, usually with little or no success. So this original company pivoted their business model: they went out to buy these "one hit wonder" software companies, immediately stopped any investment into other products, laid off as many people as possible and outsourced the operations and maintenance of the few successful products to low-cost locales (at the time, India and China) and then essentially just milked the subscription revenue until the product slowly petered out. That is, they weren't really investing in big new features in the product, but the product had a lot of existing customers who didn't (or couldn't) move off of it right away, so often they had at least a couple years of milking the existing revenue dry. I called it "the world's most successful and depressing business model".
My overall point in telling this story is that when you ask "Are you telling me that no one in such a big, wealthy company of clever engineers has any use for a bunch of talented people?", that often times the answer is "Correct!" People tend to underestimate how difficult it is to build successful products, even if you've already knocked one out of the park.
Google has killed products that could be entire companies if they weren't attached to the Search Ads firehose.
A $100 dinner could be an annual splurge if you're making minimum wage, and an arbitrary Tuesday if you have a quarter million dollar salary.
Executives think the same way about revenue streams. When they have one product that makes $$$$$ in revenue, they think "not worth my time" to consider another that makes $$. Really frustrating for the people making and using the lower revenue product, but it's why Google feels like a "billion users or bust" company.
well that's just a dreadful experience. Couldn't innovate so they instead became a very alluring anglerfish with no intent to help stimulate the American economy at all. Successful and depressing business model indeed.
Such a shame how little respect tech gets unless we're spamming buzzwords to rich people. really ruined the reputation of "tech will make everyone's lives easier!"
And they did indeed later buy multiple companies, including Tableau, in that space.
Very bold assumption
And somehow, the P/E of its stock almost always increases... Forcing it to double down on growth, that it can't do anymore.
Corporation governance is broken nowadays.
New products take time to mature into revenue generating things.
Cost savings from layoffs are immediate.
Also, they've repeatedly tried to create new products. Carousel, Mailbox, and others. Dropbox has had little to no success outside of its core business. While it does that core business very well, it has stiff competition, and the market seems to be already tapped out.
For example with AI alone we've seen an incredible number of new file services dedicated to just serving models, and DropBox has totally ignored that need.
Instead they regularly add bitsy, poorly implemented, "us too" features to DropBox which adds friction to common workflows - then provide no way to customise these features away for people who do not want them.
Perhaps to them they see this as evolving the product and keeping it relevant, but their approach doesn't address why Google and Microsoft are eating their lunch, nor does it take their eggs out of one basket.
>Are you telling me that no one in such a big, wealthy company of clever engineers has any use for a bunch of talented people?
not the shareholders. they never cared about clever engineering. Not unless [buzzword] is involved.
they need $$$ from enterprise, everything else is a distraction.
I'm on Google One at $100 per year, getting more services than Dropbox can offer with their $120 plan.
Maybe they have a future in enterprise sales, but they are outcompeted even by Zoho in consumer space
I don't doubt that Jobs might have seen Dropbox as a feature that Apple could have implemented across the Apple ecosystem, but that's a pretty limited view of where the value of Dropbox lies.
That's what I'm saying. From Jobs' perspective it was a feature for Apple, because Jobs believed only Apple devices matter. For everyone else that's a pretty limited view of the world that doesn't really apply, and measuring Dropbox (as a company) by that standard is nonsensical. It should be obvious that there's value in sharing files more widely than just within one ecosystem.
Steve Jobs was wrong about many things, and this was one of them.
Maybe people like bad products, and make bad products rich all the time?
You can make a good product and go out of business, sometimes through actually no fault of your own too.
I agree, Dropbox is a feature - and it shouldn't be a product.
Either you never give it to them in a way that can be sold (e.g. fully encrypted), or you expect them to sell it when the leaders need to increase cash flow.
https://help.dropbox.com/view-edit/privacy-settings-dropbox-...
> “For eligible accounts, […] The Third-party AI toggle is turned on”
I just logged in and checked and don't have the "Third-Party AI features" tab, but I only have an old free account and am probably not at the tier where this appears.
I agree it's annoying it was enabled by default in places, but I'm trying to either correct the incorrect "for AI training" part, or find a citation that shows they are actually doing AI training with it.
What's the matter? You like the sound of that crusty, slow Linux NAS that this site has derided for years?
Honestly, it's a lot more enjoyable than I expected. Internet enabled, easily expandable (my setup is 5TB), can quickly setup a plex server for media, and can easily up/download any files needed from anywhere I have connection. And I feel I only scrathed the surface of potential. One of the more useful investments I made this decade.
Now I pay for google drive instead.
It's not often you see this. Netflix used to do this if your equipment wasn't brand new, and with any phone[1]. And the very first startup I worked for let me buy my laptop, desktop, monitor, and cell phone for $50. But you don't see it too often.
[1] There was a "joke" at Netflix that if your manager told you that you should upgrade your phone, it meant you were gonna get let go soon, because sometimes people really did get let go just weeks after getting a new phone, and they got to keep the phone.
1. 4 months pay + 1 week per year of tenure. 2. Receive Q4 vests. 3. Upcoming approved leaves paid in cash. 4. Year-end bonuses paid. 5. Keep company devices.
If you're actually good at your job, you typically end up with an even better job: https://hbr.org/2018/10/research-when-getting-fired-is-good-...
> a 10-year study of over 2,600 leaders showed almost half (45%) suffered at least one major career blow-up — like getting fired, messing up a major deal, or blowing an acquisition. Despite that, 78% of these executives eventually made it to the CEO role.
An executive can make a series of awful decisions and still advance in their career.
I wouldn't wish for you to get laid off to understand thee current circus, but I'd urge you to at least spend maybe an hour in some of the "Who wants to be hired" threads to understand the scale of the impact, and how even HN workers can be struggling.
Industry standard is to offer 18 months of COBRA, not 6. Job searches frequently take way longer than that.
COBRA is a huge deal for departing employees. My single largest expense is health insurance for my partner and I, more so than even rent.
job searches taking 6+ months is exactly why this whole process is broken. I I could get quick rejections and considerations, being laid off wouldn't even be that bad.
There exists such a mode: it's called dividend distribution. But currently DBX and many other tech companies aren't paying any dividends to stock holders. So if it's not growing and not paying dividends, what is the company doing?
A company that is relatively stable and holds no grand world-domination-to-feed-shareholder plans is still nice
https://investors.dropbox.com/static-files/df1fe33d-3995-452...
Dropbox's EBIDTA is 14.67, but most Software Companies tend to have an EBIDTA of 28.
Dropbox is significantly underperforming compared to their peers.
Furthermore, cloud file storage has become commodified and Dropbox missed the DLP, DSPM, and AI Search train.
> Have we reached a point where tech companies have been around long enough that they can / should enter a sort of maintenance mode
Absolutely not.
If you do not innovate as a software company, you risk becoming commodified.
And if BUs within a company fails to execute on their innovation or GTM strategy, they will be let go.
Yes, absolutely.
There is value in new features and functionality but there can be so much more value in a predictable, stable tool that can be depended on and returned to.
There are people who cancelled their first account with us before dropbox existed and have returned, post-covid, to find a familiar tool to be picked right back up again.
This has been immensely valuable to a great many people and we wouldn't dream of ever changing it.
Takes full responsibility - check
Layoffs are still there
There needs to be more explanation on where the CEO screwed up that badly and the consequences for the management.
Both options should directly imply that the CEO should earn less. Either you're running a smaller, simpler company, or you sucked at your job.
Eat the loss.
They reached market saturation, which isn't the same thing as failing.
If I'm on-call, I'm responsible to carry my laptop with me and be available immediately to fix critical issues. I don't just say "I take responsibility of being on-call", and the leave my laptop at home, get drunk and fall asleep in a bar for the weekend. That's called being irresponsible.
So this CEO is saying, "if I do my job poorly I understand I could get fired."
But, did he/she do their job poorly? That's the thing I can't figure out quite yet. It seems it was bad for the laid off people, but maybe not for Dropbox?
If I got a million dollar parachute when I do my job badly, I would love to "take responsibility" as well. Fuck the people, I get paid either way here.
> But, did he/she do their job poorly?
in a fiduciary sence short term, no. So shareholders are happy since that's all their care about.
Long term, who knows? I don't see them closing the gap with Google nor Microsoft so this could just accelerate that downfall.
in a spirit of, as some politician say, "creating jobs and stimulating the economy", absolutely awfully. We have 500 more workers out on an awful job market and it's not because DBX wasn't profitable. They simply dropped workers to prepare for a bad time that the US economy doesn't want to admit out loud.
I guess the government for not regulating this kind of thing to begin with. but that's a bit out of DBX's purview.
then they probably should
not saying I should go work for McKinsey, just noticing that unnecessary payments are likely happening. companies don't exist to employ people. employees exist to help companies. just make everyone a decent shareholder with decent liquidity and move on when the employee isn't necessary.
Companies in society exist to serve the customer, provide labor opportunities, and overall stimulate the economy (all of which is needed to make money).
This mentality above is exactly why the latter half of Millensials and Gen Z were demystified by the labor market and simply don't take the kind of "loyalty" narrative of the older generations. You can't talk family, layoff "family" every 2 years regardless of talent and pretend that "hard workers get rewarded". So you'll get the bare minimum, you will get no overtime when you request it (especially if you aren't paying 1.5x), and you probably won't even get the long dead 2 weeks notice when I move on.
You can't expect much more "help" when you can't give the basic modicrum of respect to your help.
> just make everyone a decent shareholder with decent liquidity and move on when the employee isn't necessary.
most jobs don't have RSUs. Not even in tech.
If only we had the equivalent on the other side to balance the equation. Some kind of a group of individual employees, who work together to counter wage suppression efforts.
That's really the main saving grace for this industry; the scalability that a few employees can still provide a solution that makes corporations with hundreds of thousands of workers sweat. That's why they surged salaries so aggressively in the 00's and half the '10's
That's also the reason why unionization will be a hard argument among tech workers. Slowly starting to happen in the games industry, so that at least confirms there IS a breaking point somewhere for that to happen.
None come to my mind, do you have any examples?
Well run companies laying off 20% of the global staff a year after laying off 20% of the global staff?
Saying e.g. what is the impact on the situation for those responsible might be nice - no bonuses for next year? A plan in place so that this doesn't happen again? Stepping down as a CEO?
I mean, if I take responsibility for e.g. wrong tax filing, I pay the fine penalty, and/or go to jail.
Saying "I take responsibility" some kind of failure while having no consequences for said failure is not taking responsibility.
If you knock a girl up and you "take responsibility" it means you getting married.
If you are in a car wreck and you "take responsibility" it means you are paying for repairs.
If you commit a crime and "take responsibility" you are going to jail.
So if a CEO is "taking responsibility" it should be something like that second case, dollars from their own pocket to the effected party.
I'd love to hear you explain how I can get out of paying my car insurance of alimony though with this line of reasoning, though. Could be useful one day.
Much like employment, each party can cancel. You didn't sign a lifelong contract for insurance.
As CEO, it's his responsibility to make/approve the decision to do the layoffs, or not. The buck stops with him. That's all that it means. It doesn't mean he's liable for any hardships.
The moral meaning of responsibility here means that the CEO takes responsibility for the lives and livelihoods of those affected -- which does feel a bit hollow when the CEO presumably is not only not affected negatively, but probably will be rewarded for increasing shareholder value.
If "responsibility" only constitutes "I pull the trigger, and I don't care what happens as a result", then that is a fairly weak kind of leadership -- ostensibly not very different from a child doing whatever they want in a consequence-free manner.
I want to believe that "responsibility" not only constitutes "I can make things happen", but that "I am willing to Make Things Right if my actions cause things to go sideways".
If I'm wrong, then we live in a world where "taking responsibility" means "using power", and "I take full responsibility" means "yes, I used my power to do that" and that's Not Good Enough to call such people "Leaders".
You may have it in your job description the responsibility to do performance reviews on your reports. Those reviews can make or break a career. If you do them honestly and with the consideration they deserve, you should not be expected to personally bear the consequences of giving someone a deserved poor review.
It's too bad we don't live in a perfect world where everyone has a job and is never at risk of losing it. But if wishes where horses.....
Fitting for a movie from a studio made out of spite for another future trillionaire empire.
Feels like a weird hill to die on, and more like a crabs in the bucket mentality that doesn't change anything in the grand scheme of things. In the end I'm still unemployed and whatever happens to my ex-CEO doesn't change my situation one bit.
As I grew older and experienced my share of layoffs, I stopped caring about what happens to those responsible for me getting laid off, as my energy is better spent on improving my situation and my life instead of ruminating how Krama vengeance would make me feel better.
No, of course not. But he is the leader, and he guided the company to a point where certain areas became "over-invested or under-performing." In other words, he didn’t do a good job. So, it should be him stepping down. Nobody ever said being a CEO would be easy.
And now he's fixing it by cutting those under-performing areas.
>So, it should be him stepping down.
Why? How would that help the company get better? Do you think competent CEOs are like cogs that you can pick a new one from the stack of LinkedIn applications whenever the old one makes a mistake, and then slot him in the existing machine and everything will magically work better?
>Nobody ever said being a CEO would be easy.
Exactly. That's why you don't rush to replace the devil you know with the devil you don't.
It's the same devil with the same playbook. They all know each other at that level.
And yes, they are doing that in some sectors (and some CEO's want that). Less in tech, but I suspect more shakeups once the AI bubble ends.
Why don't you start your own company so you can be a model angelic CEO then? Why bother working for these "evil" guys? Or work for a local mom and pop shop instead of a publicly traded company?
>work for a local mom and pop shop instead of a publicly traded company?
I'm open to it. They literally aren't hiring tho. They get the most impacted in a downturn, so I get it.
I'd like to point out that there are other possible outcomes, like (say) the CEO and entire C-suite cutting their salary to $1 for a year (it's not like this will render any of them homeless).
IMHO, that would actually constitute "taking full responsibility", as opposed to parroting words that don't connect to the reality of the situation.
What's the point of being CEO then? Have the stress of running a company while working for free? Who would ever want to do that?
I don't know. As you said, it's a waste of energy to wonder about other people and their endeavors. Better to focus on me.
And I need the money. CEOs don't. Feels odd to go from "don't spend your energy thinking about other rich people" and then go "but rich people 'want' money" when someone makes a suggestion.
>Have the stress of running a company while working for free? Who would ever want to do that?
Again, don't know. But I suspect that most people at a CEO level are not just in it for money. There's easier, less stressful ways for millionaire to accrue money.
That's some silly delulu shit right there. Imma end this conversation with you right here since you're not arguing in good faith as you've already made up your mind, so it's a waste of my energy and time to continue this any further.
Please don't break the rules if you want to stay a part of this community.
What did you expect productive about this whole conversation?
Did you expect to see the magic formula/solution to people getting laid off from well paying tech companies and somehow I got in the way of that?
We're all just chatting here speaking our minds which has the real world practival equivalent of shouting into the void. There's no real value to be had here.
but it doesn't work like that in the western world.
>As I grew older and experienced my share of layoffs, I stopped caring about what happens to those responsible for me getting laid off, as my energy is better spent on improving my situation and my life instead of ruminating how Krama vengeance would make me feel better.
The tree remembers. If I have nothing else it's my pride for my craft. I'll probably never have some revenge arc, but I sure will take it personally the next time that company tries to make deals with me later in my career.
Call it cultural; I don't like being treated as a slave. Respect your fellow man, regardless of background or walk of life.
You don't do deals with companies who fire people? You wouldn't be working for any company in the world then. IIRC in communism they never fired people, maybe that system will serve you better. Oh wait...
>I don't like being treated as a slave.
"Sent from my iPhone sipping my latte in California"
I wish you all spoiled rich western workers would stop using the slave word so easily whenever an employer does something to you, as it dilutes the meaning and the severity of the word. Similar with the over misuse of the words woke and nazi.
Please read up on what slavery actually meant and the lives of actual slaves. Working in tech in the richest country in the world, and being fired by Dropbox isn't even remotely in the same ball-planet as slavery.
I don’t think I would be upset (unless I was extremely passionate about a project I was working on)
If we're laying off 20% of the company, I'd expect the package to be somewhere in the 6-12 months range. To me, that would seem more fair, considering they are completely restructuring the whole company.
In the US luckily the job market is still quite dynamic (and extremely tight by historical standards) so only in an extreme scenario would someone with Dropbox on their resume need 12 months to find another job.
They might have to take a pay cut from a 99th percentile salary to a 96th percentile salary though. Rough, I know.
https://en.wikipedia.org/wiki/Worker_Adjustment_and_Retraini...
When you are leaving on your own term yes.
When you are laid off you are technically still an employee for those 3 months but nowadays many companies will just tell you to not show up for security reason.
Even worse, you might have to miss one contribution to your FATfire investment account to deal with the extra risk. Compounded, that missed contribution might mean you'll have to retire at 46 instead of 45.
How dare these companies treat these people this way. They took the massive risk of working for an already-successful company at $250K/yr with a $200K stock package, and now fat cat Drew Houston dares to leave them with just an abnormally large severance after they are no longer needed.
I realized though that I was probably going to be okay, and what I actually needed was some perspective.
Sometimes the contrast of "sarcasm" is the only way to shake you out of your bubble and give you that perspective.
I thought so too... that was 13 months ago.
I still am okay, but only by pure blind luck. And okay in a "rice and beans diet" way. The actual interview gauntlets are worse than my first job search.
And yes, luck = preparation x opportunity. But I was literally cold called by a founder. My experience spoke for itself, but it only helped me tread water instead of sink into the abyss. Sure didn't work the other hundreds of times I kept searching.
>Sometimes the contrast of "sarcasm" is the only way to shake you out of your bubble and give you that perspective.
Again, the guidelines
>Be kind. Don't be snarky. Converse curiously; don't cross-examine. Edit out swipes.
Assumptions are horrible on the internet because it only enrages those who do not fit your strawman. I did everything "right" and I end up laid off twice, draining all my savings and a bit of my stock, and being gaslighted for over a year when I could grab multiple offers in 3-4 months the last few job hunts.
I work in games, I'm not making 500k salaries and was well prepared for layoffs. but I was doing very well for myself. So it's tiring hearing people deride my decade of experience with "well maybe you weren't actually a good worker". I'm definitely not a 10x-er, never have been. But it's backwards hat I have more experience now and am desired less for my experience.
It's just bad times. The sooner we can accept that, the easier it'll be to come together and weather the storm. But with layoffs it seems like all the elitism comes out instead.
I don't agree. If you don't prepare at all for an interview, it shows. Aside from leetcode, it's also important to research the company.
My point is mainly that I might be upset if I were in that group that's laid off today. I don't want to prep leetcode for several weeks. It feels like a waste of time.
Looks like enough time to prepare, take a vacation, ect.
It really is a circus out there.
I was laid off from a different company with access to 18 months of COBRA. Dropbox is offering a third of that. Lots of job searches take longer than 6 months, so the employees are going to be left high and dry right when they need it the most.
For the non-Americans, my COBRA expenses are about USD$2,000/month for me and my partner. I’m paying as much for healthcare as I am for rent. Even so, it’s still financially better to take COBRA than pay out of pocket for my prescriptions.
Plus, they're getting 16 weeks of salary. At $140k/yr, that's $2,692/wk. Lets say their severance starts next week. There's 8 weeks left in the year. So they'll get 8 weeks of pay in 2025. $2,692 * 8 = $21,538. So no, they won't qualify for Medicaid at all in 2025 if they make that much as a single person.
I'm just pushing back at the idea someone can go from making six figures and turn around and hop on Medicaid. It's not that simple. It should be IMO, but it isn't.
https://www.dhcs.ca.gov/individuals/Pages/Steps-to-Medi-Cal.... sez “Due to the high volume of new applications, the process is taking longer than normal”, and I have secondhand experience of six+ month wait times.
Expenses incurred during the coverage gap need additional approval for retroactive repayment, meaning you have to have the funds to pay upfront for however many months/years the sign-up process takes, then once your coverage starts you have to apply/wait/hope to be paid back for everything paid out-of-pocket which might just get denied: https://www.dhcs.ca.gov/formsandpubs/forms/Forms/mc210a0907....
https://www.dol.gov/sites/dolgov/files/ebsa/about-ebsa/our-a...
"Q11: How long does COBRA coverage last? COBRA requires that continuation coverage extend from the date of the qualifying event for a limited period of 18 or 36 months. The length of time depends on the type of qualifying event that gave rise to the COBRA rights. A plan, however, may provide longer periods of coverage beyond the maximum period required by law."
that's a function of how low the bar is in the US
If I had more time, I would love to understand the fss market better and also what impact ai is having there. I don't see a Q3 earnings report from Dropbox, but as others have pointed out in other comments, Dropbox seems to have been doing fine financially.
Not really.
The issue is Dropbox's core product is heavily commodified (Cloud File Store for Enterprise and Consumers).
Dropbox's EBIDTA is much lower than peers in the Software industry making it a much less attractive investment - even public companies need to attract investment.
Furthermore, Dropbox has missed out on multiple trends that it had the right ingredients to execute on, such as DLP, DSPM, AI Search, AI-leveraged Business Tooling, etc.
It's not that Dropbox didn't try building these teams - they did and I know plenty of people who were hired to work or lead these initiatives - but tech is competitive and they got outcompeted.
At some point they have to initiate layoffs in order to retool internally and concentrate on the BUs that actually generate outsized revenue along with strategic bets that can help make Dropbox more enticing.
> every engineer should have 6+ months of savings. Market isn't great but our salaries can help build those savings easy
Pretty much. Layoffs have always a thing in the tech industry.
And compared to previous cycles (early 2000s, 2008-2013), the current job market is fairly standard for mid-career.
I think this tech downturn is just the first one that a lot of 2011-22 grads went through and it makes them feel like it's the end of the world.
Keep saving, keep upskilling, and keep networking - these are what save you when we all (inevitably) get laid off.
I did. Even stretched it out to 9 months (getting a freelance gig out of nowhere helped). But it's been 13 months with no full time work.
>Market isn't great but our salaries can help build those savings easy.
It did not. Not everyone's making 300k at Google.
>If I had more time, I would love to understand the fss market better and also what impact ai is having there.
nothing short term, but the usual suspects come about as usual. Trendsetting from Twitter, ZIRP, tax code changes affecting how to amortize tech salaries, an anticipation of a downturn in the evonomy, and AI speculation (not really affecting tech, but other areas).
Those are each worth their own post, but this is againa topic talked about a lot . Since this has happened a lot.
And yes, this wasn't a layoff of necessity. That's the "venomous" part about it. Why Wouldn't I be mad at blatant greed?
What is there to say or inquire about? The human element is way more important.
>to think that a layoff is the end of the world and the absolute worse possible thing that can happen to someone.
Short of sickness or death of a loved one, I struggle to think of anything worse than losing my livelihood out of nowhere.
I guess if I owned a house and it burned down? I can insure that at least. Job insurance seems to be dead these days.
Car accident? if no one was hurt that's much less worse. I can rent a car until insurance figures itself out.
What kind of dismissal is this? Have you ever been laid off? I'm genuinely wondering what your mindset here is when you made this comment.
It's not venom, it's an appropriate response by workers to the "shareholder-value-at-all-cost" race that the industry finds itself in; an industry that has prided itself, and often built companies on, values that are the opposite.
That, and the fact that CEOs have no accountability for these decisions.
- "You shoud have saved more money"
- "oh well you'll get a better job soon" (have not seen the job market the last 2 years)
- "They were probably low performing workers anyway, they deserve it"
- "It is what it is. Business is going to business"
- "The CEO's are just doing their job"
I hate it. We can't even come together as a community, which consists of many tech workers, to empathize with our peers. No wonder we can't rise up and bring about change from grassroots.
But why is every ceo feels obligated to use this kind of meaningless corpo speak in these emails? "Macro Headwinds", "full responsibility"?
Everyday they email me telling me I’m over my limit. They always “threaten” to delete the data but it’s been two years since I cancelled.
My Qs are: why are they hoarding my data for so long? Why would they want to do this? How cheap is storage for them to want to do this? How likely is it that they have sold my data to train various LLMs with?
I'm not forcing them to do anything. I terminated my service and they're still keeping my data. Seems like shitty consumer rights that they'll just keep the data regardless of what I do.
That's what I'm trying to figure out, if others have similar stories.
But they aren't keeping it regardless of what you do. You can ask them to delete it and they will. The power is in your hands and you are refusing to use it.
You don't find that misleading and poor for consumers? Companies shouldn't have carte blanche to do whatever they want. Especially when I terminated a service years ago.
Dont expect them to read your mind and complain about it.
Hopefully something breaks through your mind, maybe you're understand why the majority of the public don't trust or like big tech.
The part I dont understand is feeling helpless, complaining, and dealing with daily emails when it would take 60 seconds to log in and delete the files.
It is like someone who cant be bothered to wipe their butt complaining about the smell.
Sure the license agreement would not legally permit that.
I wonder what kind of legal recourse you would have. There's obviously copyright infringement, but I think state laws like CCPA include remedies for violations.
I am reminded of Slack which has a similar history of rapid growth followed by a very competitive market and then significant slowing. Maybe Salesforce could acquire Dropbox and bundle it into their offerings or some other similar company?
If this isn't the full picture, let me know. I was at multiple companies trying to move away from Slack as the cost was not justifiable
In the end, Microsoft is IMHO once again abusing its stronghold on the market. Just the enterprise-compliance-integration stuff is more than enough to cause any medium or large company to move off of Slack or its competitors (e.g. Mattermost).
Slack displayed alot of hubris and didn’t pivot. Their goal should have been Microsoft or Google acquisition.
So we're making more significant cuts in areas where we're over-invested or underperforming while designing a flatter, more efficient team structure overall.
So a lot of middle management getting let go then?
As with other CEOs who say such things in similar situations - does this "responsibility" amount to anything? Like loss of salary or options or seniority. Or is this just empty words?
I appreciate that this action is probably necessary to safeguard the business but, as someone who has been at the sharp end of a number of redundancies, I wish leaders would be honest:
"We tried stuff but it didn't work. I was and am in charge, and I'm staying. We're making you redundant because we need the money more than we need you."
Obviously no leader would say such a thing. But the people affected (and thas not just those being made redundant) deserve honesty, not platitudes.
tldr: the redundancy is not the announcement
I think people (and I include myself) do understand that companies need to adjust their workforce. I think that decision is not wholly moral in nature. But it does have a moral component - and Dropbox seems to appreciate that somewhat in the assistance they're providing the people who are leaving.
But what isn't moral is an individual announcing publicly that they take responsibility for acts that cause trauma to others (however constrained that decision was) while in reality that responsibility-taking involves no consequences at all the individual. None.
In the large train station in the city where I live, the automated voice announcements "apologise" for train cancellations. I'd argue that this is as empty and insulting as this CEO's email - because no responsibility has in fact been taken. The CEOs words and the announcement software are as morally empty as eachother.
-- Some famous person's quote that I paraphrased.
> According to our data, Dropbox, Inc. ... paid its CEO total annual compensation worth US$1.5m over the year to December 2023. That's a notable increase of 34% on last year
via https://finance.yahoo.com/news/heres-why-dropbox-inc-nasdaq-...
Even if Drew took minimum wage, that would save ~15 jobs assuming $100K all-in comp (which seems low to me for a tech salary). 500 employees is more like $50M/year, and probably more.
Of course, Drew Houston's net worth is ~$2B and he could technically loan Dropbox Inc money personally to save the jobs, my guess is a lot of his net worth is actually Dropbox stock that he would have to liquidate and would affect the stock price materially. He would also need to follow insider trading laws too and can't just up and sell vast amounts of stock on a whim. Most executives are on pre-approved schedules to sell any stock to avoid triggering insider trading.
The severance package Dropbox is offering is pretty good - 16 weeks of pay + an additional week for each year of tenure, impacted employees get their Q4 equity vest & prorated bonuses, everyone keeps company devices, an offer for extra time + help for people on visas, and job placement help for everyone.
Dropbox is a public company that is profitable, but not really growing through their flagship product. No growth is more or less bad on Wall Street. They also haven't really had a major hit since their initial file-sharing product and missed some shots they probably should have hit (mainly vs. Notion with Dropbox Paper, Mailbox acquisition, etc). With many systems moving away from "files" and to "cloud objects" like Figma, Notion, etc, their workhorse product might be going away over time too. They need the time and focus to find that next S-growth curve.
Layoffs suck and no one wants to do it, but sometimes it's needed to save the ship.
COBRA is the single largest expense for departing employees. Industry standard is to offer 18 months, not 6.
Many job searches take longer than 6 months, so employees will be left high and dry right when they need it most.
Are we in the same industry, where are you based? I got 2 months when I was laid off last year.
I also know many tech people who got just 1 month.
Life pro tip: Do not use COBRA!!!!! It is almost always much, much cheaper to find an ACA compliant healthcare plan on your state's health insurance market. For one thing the plans will often be cheaper (though with fewer features). For another ACA plans qualify for tax credits, etc and COBRA doesn't.
When I got laid off I made one of the worst financial mistakes of my life keeping my employer's high-deductible plan via COBRA. I stupidly figured it had to somehow still work out to be cheaper than shopping for private insurance. Boy was I wrong! Between the "high deductible" part and the fact the plan wasn't able to qualify for tax credits I overpaid my medical expenses by about $10,000 over the course of a year. Had I gone with even a "bronze" level ACA compliant plan that would have been cash in my pocket that would have helped out a lot while I was looking for work.
The big reason was my medication was like $800/mo. And on my employer's plan once I hit my $3500 deductible it went to $0/mo. This wasn't a problem when my former employer picked up most of the insurance premium for my high deductible plan but with COBRA you are paying the entire premium! And for my use case, medication was my top medical expense so I was paying a hefty premium for a fancy health plan that didn't actually cover my expenses.
A "regular deductible" ACA plan would have made much more sense in my unemployed scenario as the premium was not only lower but the medication was generic and would have only been like a $23 copay!
Always, always bust out Excel and compare the full cost of healthcare on different plans. Compute the total cost of your medications, how & when you'll hit things like your deductible, what tax credits & deductions apply, etc. What made rational financial sense while employed might not make sense when unemployed or buying your own health plan. But you have to find out for yourself. Rarely does it make sense to continue paying your employers health plan via COBRA. After loosing your job you have like a 30 day window to switch plans before you will be locked into your COBRA plan for the remainder of the year -- do not dilly dally around, figure it out now!
[1] As another example, I asked if I didn't work Jan - Nov, and then made $10 million in December, would my kids qualify for mediacid Jan - Nov, and he said yes.
Although obviously if you're working at your company, you are not unemployed and do not have zero income expectation.
Also you can game the COBRA enrollment window. You have 60 days from your loss of coverage to elect COBRA and once you elect COBRA you have another 45 days to submit payment. You can elect on the 59th/60th day and then pay 45 days later if you ended up needing the coverage. If you don't need the coverage don't pay.
Exactly. The message here is it is incredibly important to re-evaluate your healthcare plan. Every household is going to be different! Bust out excel and crunch the numbers.
This is the conclusion I came away with as well. It made sense back before there was the public health insurance marketplace.
...but I tell you what there was nobody out there who told me "hey, revisit your health insurance" and it cost me a non-trivial amount of real money to learn that lesson!
When I was laid off in 2023, my mom and aunt told me to go on Medicaid. I thought it was a bit ridiculous since I had already made well above the poverty line, and was planning on still pulling in a substantial amount in the same year despite the lay off (I was laid off in January). I was going to pay several thousand a month for COBRA, and I thought my mom and aunt were crazy, since they are the sort to claim everyone's using welfare (my aunt retired early and is on medicaid, since her income is zero, so I guess she has some evidence to support her claim).
Anyway, so I did look into it mainly for the 'I told you so' aspect, to 'prove' to her that the social safety net did not exist as she imagined it.
However, to my surprise, it did, and within an hour of filling in the form online, I got free medicaid for my kids, and highly subsidized marketplace plans for my wife and I. In my state, medicaid eligibility is based on expected income / week. According to the man on the line from the state, even if I did end up making more, since my expected income was $0 (being unemployed), I still qualified! My wife's premium / month was like $100 (she was pregnant so qualified for more).
I did tell several colleagues about this, but they didn't believe me and forked over thousands of dollars.
In my state, medicaid is superior to my old PPO plan. For one, there is no co-pay and my daughter ended up needing major orthopedic intervention (severed finger) and we paid $0 out of a total cost of $150k. Although you're assigned a doctor, it's still essentially a PPO plan (you can see whomever you want whenever you wanted, so we stuck with our old doctors).
So, please avail yourself of the very safety net you pay for. COBRA is basically always a bad deal. There is almost certainly a subsidized plan out there for you. There's a pervasive myth that the social safety net doesn't exist in the USA and I almost lost $10k (or more with my daughter's incident) because I didn't do the obvious. I also learned that should I ever want to leave my job to start a business, I honestly really don't need to worry about health insurance.
As is standard. My recommendation to anyone that works in a corporate environment is that if you want to know whether the company will be at risk of layoffs in the future, become good friends with someone in sales. When the sales leads and activity start to drop (or growth rate starts to slow), you can usually be assured that layoffs will eventually follow. In my experience the sales folks were always the first to clean up their resumes and start the job hunt because they knew what was coming.
That is insanely low for the CEO of a public company of Dropbox's size. But I suspect he owned a lot of shares in the company so when it went public, so he doesn't need salary, it is just a rounding error in terms of his wealth.
EDIT: Yeah, he is worth $2B according to Forbes: https://www.forbes.com/profile/drew-houston/
Also remember once you have that much money a lot of things become basically free, both figuratively ($100,000 to a billionaire is nothing) and literally (comped rooms, gifts, etc for basically every event and your company(ies) end up footing the bill for most of your expenses).
There's plenty of people who make $5-50 million in a windfall and are never heard from again.
Just to rant a bit more: the Wordpress situation makes this point even more crazy to me. Mullenweg has about 400m and instead of retiring and enjoying life, he’s arguing with anonymous users on Hacker News. No offense against hacker news but defending my life decisions on HN isn’t exactly the first thing I would do if I could do everything I ever wanted. Like, go buy a plane and take flying lessons, or go scuba diving? Nah, I’d rather justify myself on the internet.
In fact, internet communication is much closer to dark-age "public square" type communication. Bring your soapbox to the square, talk loudly, gather a crowd, and listen to the crowd jeer or clap. We haven't had that since the industrial revolution pre-1800s (i.e. at the earliest 1700s)
For the forseeable future, we are in a situation where people will "feel" that the most authentic communication is intentionally said in-front of the internet bystanders. So a CEO posting an intimate reply to an individual with billions of people able to see the intimate reply is more "authentic" than everything else.
(Much closer to dark-age communication implies that we are closer to "old" methods of communication that disappeared for the last couple of centuries. We used to have industrial revolution-type communication medium, one-direction broadcast medium.)
But there's a lot more at play when you are rich enough to not worry about money.
Some might be driven by money, but at a certain level it probably switches to a sense of responsibility, but also, it's intoxicating to be at the top where you don't really have to work in the same way, but get to direct what happens. People enjoy power. People enjoy the secrets of what happens at the top. People enjoy the recognition (within their peer group). etc...
Kids are another example. They're expensive, they're annoying, they ruin your health, they take up your free time, they consume all your resources, and they're inherently needy, selfish, and largely incapable of being grateful. Yet raising kids can be profoundly rewarding and fulfilling, in part because of the hardships, and in part because you're contributing to something bigger than just yourself, which is another crucial ingredient of meaning.
Sitting around on a yacht doing nothing is not so different than moving into your parents' basement and doing nothing, save with better scenery. It's the kind of thing you crave when you're burned out, overworked, and jaded, the same way we crave sleep when we're tired and food when we're hungry. It's a reaction to a state of being. But we only desire sleep until rested and we tire of eating once we're sated.
If you ever get to your tropical yacht vacation you may find that, in much the same way, what you thought was a permanent desire was only a temporary one.
Are you not critical of that "personality type"? What point are you trying to make?
I see a lot of people that say “If I won the lottery I’d….” and then describe something they could definitely do without winning the lottery… which makes me think they still would not actually do so if they won
The sea doesn't care how rich you are, and being a helpless dependent is boring and infantilizing no matter how big your boat - and you don't develop skills without taking risks.
Ultimately, I don't think people are often that conscious of their real goals and motivations. It's easy to say you have no choices in life because of financial and time constraints, but I don't think those are the real reasons most people choose to do or not do things.
Peter: ... Nothing.
Lawrence: Nothing, huh?
Peter: I would relax, I would sit on my ass all day ... I would do nothing.
Lawrence: Well you don’t need a million dollars to do nothing, man.
I'm working part time anyway, because it keeps me busy and interacting with people outside my home, and it gives me access to interesting real world problems that I can't really access as an individual person on the interwebs. Having other people depend on me to get things done provides motivation to keep moving on things that I can't seem to manage on my personal projects.
If I liked the kind of organizational management work a CEO does and I was good at it, I'd probably get roped into being a CEO.
Ultimately he mentions that being CEO is a rare opportunity to play a more infinite game and practice the craft of getting really good at something that doesn't have an end
But for me, if I had that kind of business success I'd cash out and go do something that feels actually important. Go get a PhD and take a crack at curing some obscure disease, or setting up a Dyson swarm around the sun, or making a great work of art, or thinking about how to improve elementary education a la Khan Academy; something like that. Then you get to have a real purpose and work toward something that most people don't just by virtue of the fact that it doesn't pay well enough, and you still get to spend plenty of time on your yacht!
Also it's nice to boss people around, probably for the same reason.
You and lots of people say would do something or other. I submit that it's different when you're actually in that position, as opposed to imagining it. Lots of us imagine we're going to go to the gym for years, and give up after a month or two.
Listen to Snapchat's founder and CEO Evan Spiegel[0] why he didn't sell to Facebook for $3 billion. He even didn't sell to Google which offered 10x more ($30bn) for Snapchat.
Nope … the Mozilla CEO makes 6.9M a year which is insane.
In comparison Drew is underpaid by a factor of 50 or more.
It's so misleading that these "CEO compensation is 100x employee pay" stats always get kicked around like it is an apples to apples comparison. It's not.
CEO's get paid in stock which they need to redeem from shareholders. Employees get paid with cash which them redeem from the company's checking account. They are different sources of money.
It's so annoying that this keeps getting repeated, on and on and on. It's totally disingenuous.
If the CEO’s stock compensation has a monetary value of $100 and the employees salary is $1, it absolutely is fair to say the CEO is compensated 100x the employee, regardless of it is stock or cash. The CEO can borrow against this and use it as effectively cash, if they are unable or do not want to exercise the options. This is such an insanely common practice and absurdly pedantic argument that I wonder why we’re even having it. Does the distinction matter? Of course it does not.
If a company does layoffs and the CEO still gets paid, that is perfectly logical because the company was never paying the CEO in the first place. Whether or not the CEO got his $5 million compensation package has no impact on whether or not the company could have laid people off, as just about everyone portrays it (and thinks how it is).
The remarkable thing is how readily shareholders will accept narratives which give the CEO very large amounts of compensation. The notorious $50bn is a high mark: https://www.forbes.com/sites/antoniopequenoiv/2024/06/13/tes... - but that is very much taking value away from shareholders and handing it to the CEO in huge amounts.
But that doesn't change the fact that employee's are paid with money that is generated by the business itself. Stock compensation comes from the wallets of shareholders and is totally disconnected from the operations of the company (although generally proportionate).
Not having worker protections is a political choice. It's not something the market or technology will solve.
Many countries have laws that prevent workers getting laid off with no severance. It is a solved problem, but it's inherently a political problem.
1. all tech jobs pay well. Well enough to expect 1 year+ savings. They don't
2. that we all have the same cost of living or family situation. Even living frugally, supporting a spuose and kid on savings is not trival.
>I honestly don't see how anyone can claim tech workers are not compensated for the volatility inherent in the industry.
Come work in the games industry for a while. 30% more hours, maybe 60% of the pay in a "good studio", and near guaranteed layoffs when the proect ends.
There's also unemployment benefits for US workers.
Haters gonna hate, I guess.
Not everyone is looking forward to US working conditions.
if you consider a few hundred a week "benefits", sure.
> people still vie from all over to work at US companies and we still draw the best talent.
yes, because like companies, the USD is coasting off of successes from long ago. We corrupted the tech boom, but fell behind on the FEV boom and manufaacturing in general.
USD is great to earn. It's horrible to live in the USD to utilzie it though. That's why companies are trying yet again to outsource.
Layoffs are the trolley problem but you get to pick how many people are lying down on each side of the track and if you want yourself to be one of them.
That said, if one reaches the conclusion that under their leadership they were forced to downsize by 20% (either due to over hiring, failure to reach revenue/growth targets, whatever) that should make that person one of the people on proverbial tracks. Compensation has little to do with it.
That's a satisfying thing to say, but as practical advice it's absolutely terrible.
Often that person's leadership wasn't the problem, but even when it was, that doesn't necessarily mean that the company will be better-off without them. And that's the question -- what will make the company most likely to be the most successful going forward? Even if the current trouble is because of some of that leader's mistakes, the answer is often to keep that leader. Sometimes it isn't.
Then what is the problem? Ultimately you’re paid the big bucks for being held responsible. Why isn’t it never something like the CEO doesn’t get any stocks that year. I’m not saying he needs to leave the company but maybe he should take a substantial hit to his pay. He has enough money to put food on the table for many years, unlike the people who are let go where it’s mostly a mixed bag.
Them doing layoffs doesnt mean the people become destitute.
It is better to layoff people who are not adding value to a company, so that those newly unemployed folks can join a different company and build great products and add more value to the economy.
Ofcourse this only applies to US tech sector where hiring is tight. Especially when coming out of top tier companies like dropbox on your resume.
I don’t think its that dramatic, folks who tend to hold similar ideologies like you state, tend to not even bat a single eye, when average americans who lack the privilege of a tech worker lose their job to automation (with tech) or outsourcing or due to overburdened climate regulations and redtape leading to fewer factory jobs in America.
This is not the titanic, those people will move on to places where they’ll have a chance for promotion.
Grandparent is not even saying that it should be avoided, just that the CEO should face some accountability from it. In many cases they have none at all, whereas the impact on the employees can range from actually quite low (as in your example) to very high. In fact there is no upper ceiling to impact to the worker which is the real problem. From the horror stories I've heard about the US they could even lose health insurance and end up with someone in the family dying because they can't afford treatment. Accountability is good precisely when there are such asymmetrical power imbalances, where one person makes the decision and someone else bears all the consequences. Either you add some feedback loops or the imbalance grows unchecked until it becomes unsustainable, and eventually you end up with a war of independence, or a French revolution and things like that.
With just a bit of empathy it should be easy to understand why accountability is needed in such situations to keep a good social dynamic long term. Someone with the empathy of a river boulder might think it's just people behaving irrationally, but I suggest you look into game theory and you'll see how some seemingly irrational behaviours like tit-for-tat are not as irrational as they seem.
>Ofcourse this only applies to US tech sector where hiring is tight.
So, which is it? Will we move on or wont we?
>tend to not even bat a single eye, when average americans who lack the privilege of a tech worker lose their job to automation (with tech) or outsourcing
They keep trying to re-outsource tech every decade and we're in another wave. Why would I not be batting all my eyes at outsourcing?
Performance based compensation is absolutely standard for CEOs- Both in terms of options and stock grants.
We know they do implicitly because laying off people makes the company more profitable, but is there any penalty for killing jobs?
If not, shouldn't there be?
From the perspective of society there are tons of answers. A common answer is that companies provide goods and services that give consumers more value than they cost, thereby enriching the lives of consumers.
It seems like some people, especially those who take issue with layoffs, tend to think the social purpose of companies is to give jobs/money to workers. This leads to a lot of frustration for those people because the entire economic system is set up such that jobs are an optional byproduct of making goods, not the other way around.
That's why I made the comment that layoffs are the trolley problem. It's an ethical question and companies don't always make the ethical choice, for example choosing profit over jobs in a downturn.
If you think companies have a ethical obligation to provide jobs and do so continuously, of course you will find issue with the rest of it. All objections stem from this, and it is controversial.
One example of people making a promise is hiring. A layoff is fundamentally breaking the promise you made to a group of people to keep them employed - whether that's the most ethical choice or not circles back to the trolley problem. If 20% need to be laid off to save the 80% then it's not an unethical choice. If 20% need to be laid off to make up for the mistake of a small group of leaders in order to benefit the small group of shareholders, then it's unethical.
> All objections stem from this, and it is controversial.
It's only controversial when you pretend that you can absolve an unethical choice by placing it behind the corporate veil. It's not controversial outside of Milton Friedman disciples.
Neither employers and employees are under the impression jobs are for life. If you're concern is primarily honesty and promise, would this piece satisfied by a written declaration and acknowledgment that the duration of employment is not indefinite and can change based on the arbitrary whims of the employer?
If you remove the corporate veil, what do you think the promise is for one human hiring another, and the ethical requirements. If I hire a housekeeper or babysitter, what am I committing to?
I dont see how corporations are held to anything but a higher expectation than individuals, not lower. Can you expand on this?
If the contract says you'll get 60 days notice and you don't, that is a broken promise (and an actionable breach of contract). Firing someone you hired is not a broken promise. You don't have to be a Milton Friedman disciple to refrain from gaslighting about employment being a promise to keep people employed forever.
It's called the "social contract". You do good work and make me money, I keep you around and let you keep doing good work. It's equally a cynical and fair interpretation of a company.
This was broken long ago, so I understand it being a foreign concept, but it's something my grandparents told me about when giving me my bootstraps to pick myself up with. Now it doesn't matter how much you make them because you can't outpay their ability to save on tax breaks or make funny monopoly number go up. So we're all doomed.
>Firing someone you hired is not a broken promise.
depends on the contract and laws around it. This is far from universal unlike the social contract described above.
If it's more profitable not to fire someone, because they're making the company money on net — given a big picture perspective — then they don't get laid off. There's no profit in laying off workers who are making the company more than they cost.
Where workers often miss perspective on this is in looking only at the smaller picture. Things can be making money in the small picture while not being profitable in the big picture, e.g. Kodak's film production operations before the rise of digital photography. If the business needs to be building digital cameras and the capital needed to do that is currently tied up in traditional film, the fact that employees working on film production may be profitable on net given the current capital allocation doesn't mean they're profitable in the big picture. And it's often a very, very good thing for society when a company in that position lays off a bunch of people and reallocates that capital, as it would have been with Kodak had they fully committed to digital earlier.
Yeah there are. If a worker is paid $100k, makes 1M for the company, but you have a 20M dollar tax incentive to bring people back to office: it doesn't matter if that worker is a 10x-er. It is more profitable to tank your productivity so you get a cushy tax break if that worker can't/doesn't want to RTO.
That was my core point on this "social contract" being broken. Companies are more interested in finding loopholes to save money than ways to make their products more attractive and grow other revenue sectors. There are a dozen more examples of this. It's not that they aren't productive, it's that the company found non-labor ways to make or save money.
>Where workers often miss perspective on this is in looking only at the smaller picture. Things can be making money in the small picture while not being profitable in the big picture,
And it's where companies miss when they look at next quarters earnings call instead of years later. Boieng is reaping it's rewards from over a decade of doing this. You can't screw over your employees and degrade quality to a point of costing lives and then suddenly wonder where it all went wrong.
Do you believe there is no such thing as an ethical layoff?
The objective of a company isnt and shouldn't be to run a charity. Some amount of layoffs are desirable just as a matter of housekeeping. Layoffs can be a hard part of doing a good job.
I think there are extreme examples and tactics where layoffs cross a moral line but not a legal line. for example, I think the humane thing to do is freeze hiring before layoffs so you dont relocate someone only to let them go.
That said, there are already a lot of business incentives to avoid turbulence in headcount. It is slow and expensive to hire people and let them go.
Yeah firing people is so tiring - might have to skip my tee time!/s
I do.
>The objective of a company isnt and shouldn't be to run a charity.
Charities pay employees too. 501ks don't mean you run on all volunteers and that it's okay to remove them at your whim. Horrible metaphor.
Anyways, a company has 3 goals
1. serve the customer
2. support your labor to enable efficient production
3. overall stimulate the economy and society
These all help the bottom line of "make profit". Shareholders have little stake here so it's annoying that that is all they prioritize lately. because you then break all 3 rules just for them, who will leave on a whim for some other speculation. And then they wonder why they lose money as workers burnout and leave, as customers get frustrated and move, and the economy gets worse as money is pocketed to the rich instead of the public.
It'a all a horrid death spiral. It needs to stop. It will stop forcefully if not voluntarily.
>It is slow and expensive to hire people and let them go.
And who's fault is that? I don't remember shouting in glee whenever I hear 5 rounds of interviews, including 2 rounds dedicated to trivia.
>Its actually incredibly hard to to figure out which people to cut in an efficient manner.
it is. That's why Hanlon's razor simply tells me they aren't trying very hard. They need to cut numbers, maxiize money and care about next quarter next quarter. efficiency wasn' prioritized before the layoffs, why would it be now?
By the way, the charity comment wasnt about volunteers. Companies are not run as a non-profit charity with workers as the beneficiaries.
If you're cynical about your peers to think that the default of them in the field is unprofitable and unproductive, we have nothing to say to each other. Learn some empathy.
One of the failure modes of 401ks and investment funds are large investment pools that don't vote at AGMs, leaving boards largely dominated by CxOs, to their own devices.
Im saying CEOs have financial skin in the game tied to company performance. They get less, often much less when the company shits the bed. This was in response to a parent post that seems to think CEO comp is entirely isolated from performance.
My thesis is that the boards of public companies have been captured by the executives, and the diffuse shareholding has been ineffective in providing oversight to the boards at AGMs. If SWE (or teacher) remuneration were determined by a (nominally independent) subcommittee dominated by other SWEs (or teachers), I posit that incomes for that role would outstrip other roles at the same organization over multiple decades, due to biases and knowing who butters their bread. It would become standard practice, naturally.
You raise good questions about how prevailing compensation is set and the relative power of corporate governance. I tend to agree that executives have a lot of leverage and it seems like boards are relatively weak. They don't have a lot of incentive to pinch pennies push back on CEO compensation. There's a pretty huge cost to shareholders if they want to fire or even replace a CEO, and uncertain upside.
There might be some class/roll solidarity going on as you propose. However, I think the bigger factor is that minimizing CEO comp simply is not a priority for boards and shareholders, despite the attention it gets from outside critics.
Yes but you’re still making $1.5M after a 34% haircut. That seems like a reward, and not any real sense of taking responsibility when you have to let go 1 in 5. Wouldn’t it be better if he just got a base salary of 200K or something and no stocks for that year? He already has a bunch of equity and if he does well at the end of the year, that equity will be worth more anyway.
it really doesn't matter. Because you don't just apply on linkedin and get interviewed for a CEO position like this. You're already a millionaire if you're being considered for a million dollar position. It can be charity work and I wouldn't care because you probably accrue money passively anyway.
>They already have millions on the line.
and if they fail they have millions left. oh no!
the outcome can be equal but the opportunity never was. And it's a real shame people with these safety nets actively work to erode the pittance of safety nets he government gives to people who make less than them in their careers than they do in a few months.
How convenient (for them)! When the company is doing well, they get millions in bonuses because their irreplaceable leadership skills - which make them 2000x more valuable than the least paid worker - were instrumental to the organization's success.
When the chips are down, it wasn't their fault per se, and the company still would be allegedly worse off without them, so laying-off waves of those who don't have decision-making power is the correct remedy, until the good times roll again, and senior leadership is ready to claim responsibility.
It must be nice to claim "macro-economic headwinds" as justification for poor performance and poor planning, but still get paid bonuses for the never-mentioned "macro-economic tailwinds"
Founding a company doesn't make one infallible or irreplaceable. Though to be fair, it doesn't feel that way when it's your company though!
1. I will note that this is an incredibly low bar.
2. I plan to one day. I very much plan not to rely on a VC for that. The purpose for my company is to not require millions to ship products users want/need and to stay extremely lean. A small team of "full stack" developers, to put it roughly. I should already be in a very solid position by myself before I come to such a crossroad.
3. I will admit I am not this "full stack" dev yet. I will still need some months/years to get to this point myself. So I'm a "student" as of now.
And right now I barely have a Plan A.
What would you do if you owned a business? Fire leadership every time they make a wrong call? Or ban them from admitting they made a wrong call?
Have you owned a business? Worked for a manager who thought like this? You’re describing the sort of mercurial boss who fires people for disagreeing with them.
Right, this is micromanaging leadership. You're looking for a manager to execute your vision. Not a leader. Short termism is a problem. But layoffs aren't proof of short-term thinking. If anything, they're a sign of past exuberant optimism.
- Find the issues, the ACTUAL issues. not "the stockholders are unhappy" issues. Not the "we overhired" issues. tangible issues hurting my bottom line. Economic head/tailwins is not a tangible issue for anything (let alone performance related) so much as a means to adjust projected earnings.
- Make an action plan, give tangible, reasonable goals. Not speculation on what appeals to monopoly money. We're a software company; if we can't collect internal data, how are we handling client data with any integrity.
- If anyone in leadership acted maliciously, they are gone. Full stop. Others are corrected. I can correct ignorance or incompetency. I won't stand deception and trickery among what should all be an aligned company with aligned goals.
(note, I won't codify a need to "fire someone" everytime a mistake is made either. a mistake is a managerial failing at best and a company failing at worst. Operate in a “a rising tide lifts all boats” mentality, not blame culture)
- if action plans and projected revenues look dire and we absolutely need to, introduce cuts. Try to cut my (assuming I'm earning anything) salaries first, then other execs. If absolutely necessary after they, we do layoff rounds. Ideally this should not happen because I have a proper savings chest for the worst times, but I'm not 100% opposed to layoffs as a last resort.
now of course, all this is unnecessary because dropbox is in fact not at the point where any of this is needed. Except maybe for Monopoly money. But yes, I have thought quite a bit about this scenario. And I still know this is still a shallow exercise since I'm missing tons of looholes and other scenarios.
What's the basis for this claim? I would rather think often it was the problem. Not absolutely every time, but most times. After all, the C-suite makes the decisions. I can not believe management decisions do not influence the course of a business.
Sure, it's possible that outside circumstances were such that no decision could avoid a bad outcome. But that's a rather unlikely possibility. Most of the time, outcomes depend on decisions. Otherwise businesses would be some headless automatons. And if that was the case, we should not pay execs much at all.
It's an obvious cheat: when times are good - it's all because of the leaders, when times are bad, it's all because of the environment. This is what they claim, but it is not the truth. Again, what's the basis for this claim? Any proof, studies, anything?
So sometimes a doomed strategy will be pursued far longer than you'd expect, barring some board or activist intervention.
Some of it is self interest, some of it is hubris.. but also one can easily blame a bad run on some broader economic situation, specific competitor actions, or right strategy with wrong team (so fire the team) .. this works for a while until it doesn't.
But they always fire the weak employees, not the ones that can easily help themselves.
Maybe we should have some laws that randomize the layoffs ...
This is definitely not the case. Companies use a lot of different mechanisms to choose who to lay off, and it's rarely entirely performance based.
Some combination of personal dislike and unfamiliarity.
The people making the cuts are not line managers and are sometimes given very short amount of time to make their cut list. So "oh I know that person" stays vs "I have no idea what they do / they asked me a pointed question in a meeting once" goes.
once i was on a team of 2 ICs and a Manager - only the manager stayed - the company is now about to fold. Other time i was let go as part of the entire US arm
There's just too many people, the decision making is too quick, at too high a level.. and more driven by cost / future strategy (so which teams to cut deeper).
There's no consistent layoff strategy. Especially not in times like this.
> Impeding this flow with regulation is a great way to create a malfunctioning economy.
yup, and look where we are heading next year...
No, it's a very poor idea to force companies to lay off at random.
We have attached shame and this idea that it is "hurtful" likely because it is so rare. At a place like a hedge fund, firing the bottom 10% of people is relatively normal, so being fired can sometimes just mean "you had a bad 6 months" not "you am a terrible person who does not deserve to work anywhere" (which seems to be how tech people and Europeans think of it). In that environment, there isn't any shame involved in the firing and everyone gets on with their lives (usually including a cushy severance package).
These layoffs do not generally happen when executives and companies fail; they happen as a matter of course. They are, of course, accompanied by rhetoric about executive failure (again, a cultural cover), but nothing more. When executives actually fail, executives get fired.
Also, can you explain the layoffs at Google this way? The layoffs at Meta? Microsoft? TikTok? Are all of these the result of underperforming executive teams? Are they even related at all to business trouble?
Or is it perhaps something closer to what I am suggesting?
Layoffs happen in waves at these companies. It really has nothing to do with performance. They do it every time they can, and the best explanation for that is that they are trimming the fat. Companies all say "we hit hard times" when they do this, but most of them really didn't. The issues with Dropbox's core business have likely been foreseen for 5-10 years.
Yeah, but we'll blame the workers anyway for "underperforming". nevermind that the only real change was that they got harder to get tax breaks on.
>Are they even related at all to business trouble?
I kinda agree with you, but also: yes they all had business troubles. Meta fumbles with VR hard and shuttered its in-house VR studio that otherwise put out well acclamed games. Microsoft is on shakey ground with OpenAI and their Xbox division is fumbling from the worst time to spend $70m on an aquisition. Tiktok may or may not be banned from the Unites States and that will take a hit (this one isn't really their fault, but alas).
We used to live in an age where leadership meant something, when people took responsibility for their failures. Now executives make excuses, they even have people like you making excuses for them, and instead of forgoing a bonus or handing over the reigns to more qualified team, they play with peoples livelihoods and you think that's perfectly acceptable, even called it cultural.
Anyway, given the age we live in, I'm not surprised at all to see people kissing their asses.
"Not working out" is doing a Herculean amount of lifting. In this case, "not working out" is "we want to make earnings calls look better and do more work with less people". Yes, you are hurting everyone in your company by doing that.
>We have attached shame and this idea that it is "hurtful" likely because it is so rare
Yes. I'd really hope that the singular good thing from this 5,6,8 round interview cycle for hiring that you somehow didn't hire someone who managed to underperform on the job. Maybe I'd even agree with you about firing culture if I believed for a second that it meant they'd be more lax in the 4 month interview process and do more probation trials.
But that's just hopes and dreams for now.
>At a place like a hedge fund, firing the bottom 10% of people is relatively normal, so being fired can sometimes just mean "you had a bad 6 months" not "you am a terrible person who does not deserve to work anywhere" (which seems to be how tech people and Europeans think of it)
Again, tell that to the recruiters. You're seeing it among peers, but there's a lot of stigma that if you got laid off you must have been "one of the bad ones". It's absolutely not true, but with so much fascination on "why did you leave your job" you can see how people really feel.
>there isn't any shame involved in the firing and everyone gets on with their lives (usually including a cushy severance package).
Yeah, I wish. Not all tech companies are created equally. Mind you I hate stack ranking, but if you're going to something as fast paced as a hedge fund, those 6 months will pay you well. So you're rolling the dice youself there.
Yeah, I agree with you that this is mostly on the risk-aversion of recruiters. There seems to have been this vicious cycle of firing being harder and more stigmatized combined with companies being more picky when they hire. Nobody really benefits from this, though.
Have you seen the industry lately? They don't care unless they have leadership who actually has tech experience. The company will float long enough for the next executive to worry about the consequences.
To put it more charitably: They may want to care but there's too much beuracracy to holistically figure out performance, and the stats measured are horrible 99% of the time anyway. So yeah, it all comes down to "vibes". Which is probably worse than random for tech workers. They won't feel short term consequences, so it's not a big deal for them if they lose a few "best and brightest" (they will probably leave after the layoff announcements anyway).
If not, I think you have a highly unrealistic opinion of who the company operates for.
Employees, acutely aware that their efforts might be disregarded in the next round of cuts, become increasingly disincentivized to exceed expectations. The result is a workforce more focused on survival than excellence, fostering an environment where mediocrity thrives.
What you are referring to is called rightsizing and it's taught in business schools, but almost never implemented well. I would guess it's because it takes to long to figure out who's weak and who's not and they are in a hurry to cut costs.
It's also insanely low for a CEO, but about right for the CEO of a company in decline (which dropbox is).
Drew is developing a habit. 16% last year
edit: 11% before that: https://dropbox.gcs-web.com/node/8916/html
Their revenue has only been growing ~5% (and slowing to just 1% most recent quarter).
When you aren't growing, you must focus on operation efficiencies.
Rule of 40, now being applied to margin.
>We continue to see softening demand and macro headwinds in our core business.
This isn't a matured business strategy. This is a business predicting a cold winter and trying to bundle itself up. Of course, the less people to warm up the better.
Companies should be managed to be profitable, while paying employees and business expenses.
Anything other is a pipe dream that eventually blows up, but since only employees suffer while the MBA guys go to become CEO of yet another adventure, who cares. /s
No one is pushing for exponential growth. If a company wants to stop, declare a dividend, and be done with it, and let investors choose a new rodeo.
The one signing off on X% might even get a bonus for doing that, and enjoy some Bahamas vacations.
But, I do get a chuckle out of what you believe is a "diss," when you're actually stating that MBA holders will not only do better in life, but they'll also control your fate.
Keep that narrative alive; I love it!
It is like assuming generals can win wars straight into the battlefield after graduation from military school.
Some get lucky, most of them do not, then again the little soldiers are the ones thar have to worry with the actual outcome.
Good that you're having fun.
This doesn't mean it is not a diss - most parasites fare quite well, and definitely determine fates of their hosts.
Not if I can help it. America is doomed but I can scavenge out my own little hole to settle in and see if that survives the fallout.
If there's one thing I learned, it's that tech has an amazing ability of scale that can even topple titans if you strike at the right time and place. You won't make trillions, but you can live very comfortably. And that's all I want; I don't need infinite money and exponential growth. And if I do get a company that achieves that I will keep it that way. a proper business, not a speculative stock to gamble with.
It means absolutely nothing to you, but you're the exact kind of person I'd avoid in my company at all costs. Our goals diverge too much, and that's not a bad thing. Comapnies need to have proper alignment to succeed.
ic1 at dropbox is 175k and ic4 is near 500k, ic5 near 700k.
https://www.levels.fyi/companies/dropbox/salaries
Do they really need such highly paid engineers? Are they really doing anything that innovative, new or first on market.
They could probably save these jobs by adjusting the comps.
Remember that Dropbox (like Twitter) is HQ'd in San Francicso.
On the consumer level, you need to have mortgages as I don't think most people have 500K lying around in order to purchase a home. As such, there needs to be some way for the common person to borrow the money to finance a home. Obviously there is no way to "sell" your mortgage, you can only sell your home. And yes, you can borrow money against your home in the form of a HELOC, but you doing so doesn't affect the price of the home or the market, just what you have to pay off.
Most banks on the other hand, bundle mortgages and sell them on the open market in order to recoup their cost of them rather than servicing the loan. To me this shouldn't be allowed. If a bank wants to sell their mortgage portfolio to another bank or group of bank, that's ok, that doesn't affect the market and is a private transaction. What I have a problem with is them bundling the mortgages and placing that portfolio on the open market as that causing collapse like we saw in 2012.
if they decide not to hedge, then it must be because they don't think they're exposed to much risk, which basically means they like the stock and would be willing to own it. it feels like it mostly works out.
In other words, this is to satisfy Wall Street.
i would love to use dropbox over icloud, but I just want a drive that works and a way to turn off all their weird features.
Most of the time, reducing staff is a healthy move for the business and the impacted employees. The company will not only save cost, but strengthen its culture of high performance. And under-achieving employees are often fundamentally unhappy in their role. While the short term impact of being made redundant can cause some distress, these people can still use the occasion to reset their careers.
So all in all, no reason for grief.
I realize that's difficult in today's performative world, where an quick perusal of LinkedIn shows loads of people that are "passionate" about banking compliance or insurance claims or whatever. Many companies have also have fostered this false idea that companies are a "family". That is always false. The best companies are more like a team, and when things start to go south, sometimes people on that team are cut.
Ironically, I think the professions where people really are passionate and see it as a "dream job" (think professional sports teams, actors, musicians, artists, etc.) generally have a much healthier view of their employment in the first place because they realize how tenuous it is to begin with. Point being, if you're considering suicide if you lose your job, you should be in therapy long, long before it gets to that point.
One final note: before I get the pushback of "that's all nice to say until you have no income and are living on the streets!", let's get real for a moment. First, I have a ton of sympathy for people who are laid off - it sucks and can be very destabilizing. But lets also get real - people were laid off from Dropbox with a very generous severance package and they are in a highly paid industry to begin with. None of these people are going to starve, and nearly all of them will be able to eventually find employment (if perhaps not at the same exact high salary as Dropbox). Any mental health issues folks have after getting laid off is nearly always the result of tying one's self-worth to one's job, and that's the link that should be broken.
We can talk philosophy all day long. I just want to pay rent, respecfully. People telling me to "upskill" seem tonedeaf to this.
And this isn't some thing unique to tech. All jobs dried up. I wouldn't be worried otherwise if I could find ANY work right now.
>But lets also get real - people were laid off from Dropbox with a very generous severance package and they are in a highly paid industry to begin with.
okay. Other companies don't. I got a month of severance and saved up 6 months.
It's been 13 months. What now? I'm not starving but only by dumb luck.
>Any mental health issues folks have after getting laid off is nearly always the result of tying one's self-worth to one's job, and that's the link that should be broken.
No it results from peopel stresse on how to survive. Maybe be real and look outside the FAANG bubble every once in a while. I'm not worried about Dropbox, but everything else in this BS economy that pretends to be soaring.
I don't belive you have any sympathy given this comment. You just want blame anything except the environment and people not magically being prepared for 6, 12, 18+ months of unemployment in what was very recently a "hot market".
I have spoken with professionals in ballet and they actually feel mental strain from having to file for unemployment when off season. Even though it’s considered normal practice it doesn’t mean it’s right to treat people like that.
Dropbox gave a generous severance? Maybe, but is that is the case everywhere? I can tell you, the start up I worked for before, Aurora Innovation, only gave people one week for every year worked and they were doing silent layoffs in groups of five. One of those people was a young father on H1B who had been there less than a year.
Saying you should be in therapy long before it happens is rather callous. How was that father, or any of the other people, know they would need therapy beforehand for something they have no control over? It’s like saying you need therapy before an earthquake destroys your home.
Dropbox has fallen so far behind many other companies. Google photos search is amazing, it merges people even if they don't have contacts, it has really good image recognition, it has some sorting/ordering amongst many various dimensions.
Why can't I make small edits to text files in dropbox? Why haven't they added any useful apps?
Why are they not the best photo organizer/searching system?
The titanic was warned over a day in advance. It then took 3 hours to sink. You can absolutely be sinking but look to be productive for a while. Especially if the company just wants to tread water instead of grow. And I hope they have enough lifeboats ready when that time comes.
Protestant work ethic got you by the gizzards.
We call it "rest and vest" here in the tech retirement homes of companies known for being "chill" like Microsoft, Linkedin, Salesforce, Oracle, IBM, Intel (historically), etc
Sorry, but I call BS on this
I guess Wu Tang was right.
And yeah, I do not pay for Dropbox either. I've got something like 17gb from pestering people for sign ups XD
In 2024, I wouldn't invest in any company that's based on "Files"
This eventually led me away from Dropbox and I am now an iCloud user - the convenience and cheap prices eventually convinced me, even though I wish a Linux client existed.
I honestly don't remember the fine-grained details, sorry, but it had something to do with waking up one morning to my remaining storage being consumed by every file in Drive being duplicated, with a title "(overwritten 21h4m)" or something like that appended to each one.
I can't remember what caused it, but what I do remember is that there was no way to remediate it through the Drive app itself. Meaning, if I wanted to return my drive back to its original state, I would be burning my own time to write the script to do it, or I would be burning my own time to research some other solution. I couldn't believe the feature was shipped in that state.
In my opinion, if there exists a feature that leads to all of my files being duplicated, then it shouldn't be released unless there has been thorough testing against that feature's ability to remediate the fubarred status that it has enacted to "protect" my files. In this case, I think the feature was version history.
So the three conclusions I could come to were that there was little to no testing, inexperienced engineers, or a project manager that isn't managing the project particularly well. In any case, I don't want to feel like I'm beta testing features with my most important files, so I went back to Dropbox and its more mature app. Haven't looked back since.
CEOs need to not say this, unless they're quitting too.
This just makes me respect the old school processes that apple and nvidia follow that much more. They are the best run companies in tech
Next - we have to raise our prices.
Probably lazy money invested for gains takes its toll on the rest of the society.
Surely that should fix things?
In plain English it means sales are crashing with no change forecast in the immediate future.
works both in Windows and Ubuntu?
Ah yes, there it is. Maybe roll yourself into the 20% at least.
I’m writing to let you all know that after careful consideration, we've decided to reduce our global workforce by approximately 20% or 528 Dropboxers.
Should be replaced with
I’m writing to let you all know that after careful consideration, we've decided to reduce our global workforce by approximately 20% or 528 people.
You should never use your pet names for employees in a layoff announcement. It makes an otherwise serious announcement seem tone-deaf.
Then again, I'm also of the mind that email addresses (or whatever other contact methods) ought to belong to functional areas/positions rather than to people (other than for person-specific topics such as time off, personal development, etc.) so turnover doesn't lead to questions of where to send questions/requests. I assume this is an unusually inhumane outlook!
They're not Dropboxers, they're not associates, they are employees. Pretending otherwise is foolish on both sides.
---
Listen up: 20% of you—528 people—are out. This isn’t a discussion. I’m pulling the plug on your roles. That’s it.
Why? Because we’re not making enough money to keep this bloated mess afloat.
We’ve been weighed down by too many damn layers, too much bureaucracy, and soft sales. We’re not here to carry dead weight. If your department wasn’t delivering, you’re gone. We’re only keeping what’s absolutely necessary to survive.
What’s next
This is a brutal market, and we’re not interested in getting left behind while our competitors rake it in. We’re cutting back hard and doubling down on what we think might actually make us cash. This is a no-BS, keep-up-or-get-out game now. You’ll hear more about our plans for 2025 soon.
What you get if we’re cutting you loose
Here’s what you can expect, take it or leave it:
Severance: 16 weeks’ pay, plus an extra week for every year you put in here. If you’re international, you’ll get what’s legally required. No more, no less.
Equity: We’ll throw you your Q4 vest.
Bonus payout: If you were on a bonus plan, you’ll get a prorated payout based on what we predict you would’ve gotten.
Leave payouts: If you had any paid leave left, you’ll get a check for it.
Visa holders: We’re giving you a bit more time and a consult for your next steps. After that, you’re on your own.
Healthcare
US folks: Six more months of COBRA.
Canada folks: One month of healthcare.
All of you: You can still use Modern Health for therapy. You might need it.
Devices
Keep whatever company devices you’ve got. We’re not taking them back.
Job placement
You’ll get some career coaching and placement help, but after that, it’s up to you.
What’s happening next
We’ll give the rest of the details later today. If you’ve got questions, there’s a Town Hall later this week.
For those who got cut: thanks for your work.
---I guess there's a very small number maintaining the core Dropbox stuff and most of them are working on speculative projects to increase revenue (e.g. this Dash thing they mentioned)?
No, the HN consensus is they are massive geniuses for moving out of AWS. Nobody here ever accounts for the extra datacenter, hardware platform, hardware ops, infrastructure ops, etc.
I just wish the language in the announcement reflected this reality. Instead, it feels like a lot of desperation measures from current tech companies: overly optimistic to the point of naively dismissing or ignoring reality, and believing that if we just keep building then we’ll continue to grow forever.
Jokes aside, how do you end up having more than 500 excess people than what you need? What is management exactly doing during the time they went from 1 excess person to 500? Did they just hope the "macroeconomic headwinds" would become tailwinds? Didn't they at some point see that they have more people than valuable work, and maybe we should deal with that problem instead of hiring another team to place even more bets?
Actually, I know why. It's because they have too much money and when you have too much cash, you start splurging without thinking and then one day the chickens come home to roost.
Honestly, I would not hire a single manager from these big companies because they operate in an environment where they're playing with monopoly money and don't know what reality is. There's something to be said about spending within your limits and not splurging on the next shiny object. Way back when it was called cost control and operating within a budget. All that management theory seems to have been lost in the age of cash injections and valuations based on everything except retained earnings.
Instead I think the company has plateaued in growth and thus they need to cut back spending otherwise they will have falling profits and no growth - which is worse than just no growth.
(Dropbox customer, pls just sync and store my data reliably)
Edit: Reply was as I expected, thanks bhouston, agree they are potentially at the mature stage
Not sure if you are serious or not, but understanding the output of knowledge workers is a famously difficult task.
That's why large companies don't look at individual worker output (performance reviews are mostly performative and subjective) and just look at stock prices and profits.
If "line goes up", it means workers as a whole must be doing a good job , even if individually many might not be good at their jobs, but as long as line goes up, nobody cares to look too deep into the hows and whys.
If line stops going up, then they start laying them off more or less randomly or forcing RTO, or such things regardless of individual performance.
Having worked in several startups through the early growth stage, it's just surprising how much you don't get more done with, say, a 500 employee company than a 50 employee company.
There is a ton of room to grow less and maintain more, and it's a real struggle for a business to decide its product is done with major growth and the associated need for a large staff.
If I see a manager put "led a team of 40" on their resume, in the interview, I ask "did you need 40 people? Did you need more, did you need less, and how would you have found out?" and the number of times this completely catches them off guard is staggering. It's like... did you choose that number for a reason? Or was that just the most you could fit in your budget?
And sure many hands make light work, but there's an inflection point where the sheer weight of your organization becomes a liability, where getting anything done or changed requires the involvement of so many people that most just don't bother unless it's an emergency. That's how you get corporate rot, and that's how you get all the massive companies we rag on here about all the time who have been making like, 5 products since before most of us were born that everyone fucking hates but everyone uses because everyone else does.
I'd like to emphasize further the but. The speed of tasks scales with the inverse log of the organization size.
In other words, as you get bigger, every project gets slower, regardless of how many people you have working on it. A project that would take a week in a tiny organization might take a month in a medium organzation and 2 quarters in a large organization. Sometimes there are good reasons for this, sometimes not.
Product roadmap probably had some ambitious ideas that got scrapped when earlier steps proved to not be marginal revenue generators.
Jobs said it best: Dropbox is a feature not a product. All their efforts to make it a product (let alone a platform!) have worked against usability and alienated a lot of users. I am hopeful these layoffs signify a return to sanity in a company that seems to be leading the charge in racking up unforced errors.
That said, I’d rather the company stick to its fundamentals with no further feature creep and focus on lower subscription cost rather than features to justify higher costs.
Are you sure that you will always be able to accurately tell if you need a fifth person or not?
Or you have a team of 5 people. Can you tell if you have a one too many?
I don't know if this is empirically true or not, I haven't seen any statistics. But I don't see any obvious logical errors in this reasoning.
It's also less labor intensive to focus on a few core areas, making smaller incremental improvements than doing that PLUS launching big ambitious greenfield projects.
Also, remember how people used to say "Startup X is a bad idea because <established tech company> could just clone you in 6 months"? Well, those ideas are now back on the menu for entrepreneurs because bigger tech firms are now running too lean for quixotic defensive plays like that.
It's actually a pretty simple risk/reward equation.
The risk of understaffing a company is greater than the risk of overstaffing a company.
If you overstaff a company, the solution is quick and easy. If you understaff a company, the solution is extremely painful and takes a very long time to fix.
E.g. it takes 1 day to fire someone, but 9 months to hire/onboard someone. So to ensure the staffing isn't a bottleneck for growth, the obvious answer is to err on the side of overstaffing.
TLDR: You need to hire and onboard people before you actually need them. If hiring and onboarding someone takes 9 months, you need to guess how many resources you'll need a year from now, and hope that your estimation is accurate. (And obviously a lot of companies over-estimated how many people they would need, hence lay offs)
These same macroeconomic headwinds have existed for some time now, and the fundamentals of Dropbox’s core business commoditization haven’t changed for the better.
So they muscle into a team lead or manager position and grow the team, because it looks good to post on linked in "hey I'm growing my team" and it doesn't matter if the team needs another person.
And who cares if the company is then stuck with surplus employees, not the person who hired them because they have moved on and up at another company.
Money was almost literally free for like a decade. I'm so glad that era is over, and I hope it never returns, but the period of adjustment as businesses discover that they have to actually have a business model again does suck a bit.
Isn't it for best if society keeps interest gathering, rent seeking, behavior to a minimum and instead encourages that more of the available capital is put to good use?
I suppose it depends on what the alternative was for that capital. Sitting in an index fund wasn't really doing anything useful for society, but providing high paying tech jobs to dropbox employees was probably very useful to society. Especially when you consider all of the downstream impacts of those employees spending.
Similarly, I would ask if society gets more good out of transferring the wealth to crypto-bro's or from it sitting in relatively low yield investment vehicles? I would wager that the crypto bro's buying lambo's acted as a better economic stimulus than non-productive interest gathering.
Now if the choice had been between investing in "good" businesses vs "bad" businesses I would agree, but I don't think it was.
I think rewarding people for dumping useful labor into a black hole is bad, yeah. If we're just handing it out, we could've split all that money to everyone equally and reaped much better rewards as a society (useful social services; more family stability; less poverty) than giving a few gambling addicts overpriced cars in return for nothing.
From a higher level perspective, we didn't give them those cars, they bought them. And buying them provided tangible benefits to the people who made them and the companies that serviced them, etc. The money was freed from the dragon hoards of the unproductive and actually SPENT on something. Spending is useful. Hoarding isn't.
Could it have been better spent? Sure, but spending it at all is better than leaving it to rot collecting a few points interest without actually producing anything of value.
This is an incredibly uncharitable and shallow take, on the level of that comment many years ago that said something along the lines of "what's so interesting about Dropbox? It's just rsync, I could build it in a weekend".
We don't operate in a perfectly legible world, especially more so when it comes to people. It's all bets and risks and whatnot.
If you or anyone has the power to create perfectly aligned and efficient organization, I'm waiting here to see you build large multi-trillion dollar companies. Let me know how it goes.
One possibility is they staffed up a bunch of projects on bets that ultimately didn’t turn into viable products, and are now pulling the plug.
It's difficult to go against Apple, Google and Microsoft when they're vertically integrated and can squeeze you on all sides offering an OS, email, browser, cloud sync, document editing, etc with seamless integration between them, while you're just a cloud sync service on their OS. You don't have any moat, while they do. There's no way you can compete with them from that position unless the government were to break up their vertical integration for anti-competitive practices.
That's definitely not something one can say about their BigTech competitors.
To me that's now become a red flag with these companies. Not speaking of Dropbox in particular but all these start-ups from the past that offered a free new innovative product/service for Android/iOS went to shit soon after Appel and Google copied and integrate similar functionality into the OS out of the box, leading to investor money drying up and the company suddenly paywalling and gouging existing users to make money to survive. Look at Evernote, LastPasss, Cerberus, etc. but also Amazon, Netflix, etc, enshitification galore.
Google and Apple are less likely to do that since they already make more money than God and tend not to want to fuck up their reputation just to squeeze a few more bucks from their users.
That's why I don't trust these small app companies anymore, since they'll get squeezed out by Apple, Microsoft and Google, and enshitification will ensure. The app is good in the beginning for a few years when VC money is abundant and their goal is user growth at any cost, but after that suddenly once you're locked in, you get paywalled, as the company tries to squeeze more money from you so VCs can get their money back. Rinse and repeat. So no thanks, I got burned a few times already.
But, as parent poster pointed out, taking on that new work requires hiring people to do it. But that's expensive, and those new products need to start generating revenue quickly in order to cover the increased payroll costs.
I am sure they're not trying to be a Microsoft of Google, but they're trying to make a niche in document handling, file sending, password management, a lot of those little things that are something of a pain for many businesses.
I think if you compare what Dropbox is offering at $15/user/month to Microsoft 365, there are a bunch of things that Microsoft isn't really covering or isn't covering as well (and vice versa, to be fair). For example, the ability to take e-signatures, document watermarking, facilitating out-of-organization file transfers, etc.
I also think they compete quite well with Amazon Drive, considering that Amazon Drive was discontinued.
> Open the "More" menu in your Dropbox interface and I think you may be surprised at how many different products they have.
The other thing is that the most popular features aren’t necessarily the most profitable ones.
Dropbox doesn’t make money on the millions of people with free accounts, and they are selling commodity storage for their paid users at thin margins. But a product that can solve business pain in a unique way can command better margins, which is why they are getting into other businesses like document signing rather than just sticking to selling bulk cloud storage.
Those 20% of Dropbox staff wrote a bunch of code, made a bunch of sales, and did a lot of other tasks that will have an impact even after they don't work there anymore.
Even though they are being laid off, their contributions still have a positive impact on the company. Even the government treats it this way from a taxation basis: software that is written by engineers is treated as a depreciating asset that is amortized over 5 years.
In other words, if I write some code that consumes $100 worth of my labor, that engineering work is considered by the IRS to be an asset to the company with book value from now until 5 years from now. If I'm laid off, the company still has that $100 asset on their books, which depreciates over 5 years.
It's perfectly normal for a business to plan out their future based on uncertainty and risks. If they only hired people they knew 100% they would need forever, they'd miss out on a lot of opportunities.
Extending this logic far out enough and we could say ridiculous things like "How could IBM be so irresponsible to hire hundreds of thousands of engineers to make business mainframes when their marketshare will dwindle to a sliver in 40 years?"
The truth is that businesses need the employees that they need at a point in time, and that number is constantly changing.
Another truth is that we've collectivly decided that all people must be working in order to "earn" their right to exist. So anytime there is a large layoff like this, there are a lot of new stories about people relocating, making major changes to their lives, some for the better, some for the worse, and some for the absolutely devastaing.
One must not forget that these 'human resources' are more than just a number.
I totally agree with the idea that the benefits of at-will no-notice termination employment are lopsided in favor of the company, but the flip side of that arrangement is that it's very easy to get a new job in the US compared to many other places. It's easy to be hired on a short conversation and a handshake in an at-will environment.
So is yours.
> We don't operate in a perfectly legible world, especially more so when it comes to people. It's all bets and risks and whatnot.
What bet was dropbox taking by overexpanding their workforce by 20%?
> If you or anyone has the power to create perfectly aligned and efficient organization, I'm waiting here to see you build large multi-trillion dollar companies. Let me know how it goes.
This is an interesting statement. Dropbox is a single digit $billions company, not trillions.
When asking this question, I think it's good to remind ourselves how much we don't know. We don't know if they overstaffed in a push to expand their business that didn't work out, we don't know if the had an older operating model that went from "efficient" to "inefficient" as scale and market dynamics changed. We don't know if advances in productivity to tools, or changes to major client accounts, impacted their staffing needs. Determining whether one is "overstaffed" is a multi-factorial determination that can be false one month and true the next.
Set aside whether it's uncharitable to just assume management oversight or idiocy - it's hubristic. Having said that, it doesn't mean the assumption is wrong, it could be exactly right! But it might not be.
The OP made strong statements with weak backing. Their statements were also placing blame. Your profile says you're an SRE--can you imagine a post mortem with that kind of attitude?
In part, to unpack why part of this glib take is missing the complexity, "don't know what reality is", is that finding reality is slow and costly. Perhaps your team provides a platform which is used internally by several other teams building various products. It supports a bunch of use cases, but it's hard to evaluate the actual ROI of the platform you provide, both because no one knows how much better/worse those products would have been without your platform. Would they have taken months longer to implement? Would they have not been possible without spinning up a team like yours?
Further, some of those products actually are used by paying customers, and others are still in development. Of the products used by paying customers, it's unclear which they would actually pay to use vs which they use because it's available in their subscription basket (e.g. is Dropbox Paper making money or is it just that some Dropbox customers use it but would pay the same sync subscription if Paper was killed?). Of the products that are not yet in customers hands, how should you value them? If your small team supports multiple in-development products, that must be worth something even if they're not revenue-producing yet.
Similarly, suppose you're a manager who runs a team building a product which has dependencies on multiple platform/infra teams -- do you really have visibility into the real costs that your team's requests create? Can you really know the ROI of your team, to guide choices about various investments?
This kind of ambiguity means that even when leadership wants to see which teams are really contributing value and how much, it's quite difficult to see. Teams may optimistically estimate their own value because they cannot see all of the costs to which they contribute, or because they cannot see which revenue-affiliated use is actually valuable.
It is usually not the case that these people are standing around and doing nothing. It is more that they are working on initiatives and projects which the company is discontinuing now.
When the company has a lot of money investors expect them to spend some of it in finding new directions and opportunities. It's not all just spent on keeping the lights on, and the servers humming.
If they don't do this people in 3 years will be asking "What has Dropbox been doing all these years?"
If they are doing it right you are just amazed by the steady trickle of new features and services, and improvements which keep the company relevant in the years to come.
There never is an excess amount of workers (sure, there probably are 4-5 exceptions). What happens is that they need those employees, but instead are going to demand that the employees that are left pick up the slack. Which they will because they need a roof over their head.
Those companies are merely cutting costs, they don't actually have any excess employee.
Obviously past results do not guarantee future, but what the masses follow is generally a recipe to disaster. I think that's why we're seeing the return/visibility of stacked ranking. Management theorists see one successful company trive or a former successful company fall, and then everyone follows suite because they're "data driven," not driven by first principles
When you're big, investors and banks and auditors don't like flat structures with a lot of individual contributors. A vertical structure is a must to go public. The rest is people playing the game they're forced into.
This comment should be at the top. Not just at the top of the thread, but at the top of HN homepage.
It's how during the pandemic many companies just suddenly doubled their headcount without any extra output in products or quality, and now we're seeing somewhat of a correction to that with all the layoffs.
It's how you see people in tech hubs climb to the top of some large companies despite never having worked longer than a year at any company. Nothing against job hopping but I ask myself what skills and value people like that actually bring, who have 10x 1-year of experience, as they're never in a place long enough get to see the end results of their work and decisions, if they're good or bad, they barely pass the onboarding stage.
It's also how many of these large orgs end up failing long term. Look at Intel now, or german auto makers, as the goal of each worker there becomes gaming the system to getting yourself a promotion at the cost of the org as a whole, instead of adding value to get a promotion, since the org is very bad at setting the right goals and incentives for the workers. Google and the like who have a monopoly with an impossible moat or an infinite money cheat can resist this enshitification much much longer than the rest of the companies.
I'm not even mad, in the end most people are just playing the game, they don't get to write the rules of the game, and the ones who do are out of touch with reality so they can't be mad when people try to game it for their personal advantage.
Might be the first time I've heard this hot take out. What makes you think banks care what the org structure is for a public company? Banks don't care for size as long as the company is fiscally prudent and can prove it. They do check silly metrics sometimes like revenue per employee, but they really don't give a damn how your company is structured. By that metric, 2012 frat club Facebook wouldn't have been touched - yet they had like 10 investment banks frontrunning their book. In fact, I'd say 2012 Facebook IPO was the trigger for a lot of banks not caring about such silly things.
As a counterpoint to your argument, there are 200-500 employee biotechs not generating meaningful revenue that are trading publicly (and which went public without a SPAC play). The decision on who gets to go public falls on the exchange, not on the banks - they simply sell your stock to their investor list, and a flat structure with fewer than needed employees is actually a great selling point for a bank.
If you want another job, make it a job to find it, and you will eventually find it.
If you bet on growth/new features but your current and future customer base are going out of business or downsizing and you have to switch to more of a survival strategy.
Well, part of the overhire spree was to prevent other companies from hiring the talent.
IMHO, that's both disgusting and abusive.
But that view might oversimplify things from a business perspective, especially beyond the case of Dropbox.
When a company has ample cash reserves, a common strategy is to leverage the opportunity cost. This can mean growing the team or investing in ventures with both planned and unplanned outcomes. Take Microsoft or Google, for instance: both have a long history of projects and acquisitions that might be considered failures, but these bets were possible because they had the resources to try, even if some failed to pay off. This approach acknowledges that some investments will succeed, while others are simply part of exploring new growth avenues.
Time is the resource that you cannot recover.
Twitter fired 80% of their staff; and they've been releasing features faster than when they had 4x more people. I suppose work can expand to occupy whatever available headcount - nobody cares whether it's useful work or not.
This question always gets posted to HN, and is always the top comment whenever an article talks about how many people Company XYZ has. It seems like a lot of people just have never worked for a company that's growing (in terms of both profit and the amount of _stuff_ they are trying to do). Companies' need for people grows quadratically in proportion to the amount they are trying to do, not linearly. If it takes a staff of 20 to deal with 2 "units of work", it's going to take many more than 40 to deal with 4 units, more like 80. For 10 units of work, we're talking a staff of 500. You need all of these people to manage all of the growing internal network of complexity and yes bureaucracy that forms whenever you need to get people to work together. For every N people you hire, you'll need a manager to manage them, and for every N of those managers, you'll need a second level manager, and so on. You also start needing to actually deal with legal and regulatory compliance (rather than the yolo approach most startups take), you need to deal with HR and payroll for all these new people, you need to deal with power-of-2-scaling training and internal documentation needs. And all of those people you hire to do these things need their own managers and on and on and on.
I've never seen a company successfully scale what they are trying to do without needing a ton of people. Maybe every company I've ever worked at is just inefficient but I don't believe it.
The leadership should have been rebalancing yearly and quarterly in small chunks so they’re not in a position like this. It’s also a strategic play, while they come out with their major AI move next. That’s my guess. Gotta satisfy that board somehow
Perhaps because there hasn't been a good answer yet.
> For every N people you hire, you'll need a manager to manage them, and for every N of those managers, you'll need a second level manager, and so on.
But clearly that's not absolutely necessary, because already we know that two uncoordinated companies can make 4 units with 20 staff each. If the second level manager isn't providing enough value in terms of eliminating duplicated work then they shouldn't be hired.
Of course diminishing returns are going to set in, and bureaucratic inefficiency is a law of nature, but I see your answer as more shallow a dismissal than the question deserves.
That's fine. The question the poster raises is how come they have 500 over the number of people they need, if the amount of work wasn't reduced.
As a proxy for amount of work, we can take Dropbox revenue: https://stockanalysis.com/stocks/dbx/revenue/
If those people were needed but now aren't, does this mean Dropbox plans to do less "units of work" and decrease its revenue?
I think a more convincing argument is they overhired even when taking your argument into account.
Because circumstances change and evaluation of projections and optimal employment numbers under them change, and it's never optimal to hire enough people to actually assess that with minute-to-minute updates.
> There's something to be said about spending within your limits and not splurging on the next shiny object.
There is something to be said for hiring and cutting slowly rather than rapidly in response to changing circumstances, and that is that, under the material incentives in a competitive capitalist economy, it is a poor strategy for a corporation.
> Way back when it was called cost control and operating within a budget.
Guess what happens quickly when you are good at operating within a budget and the projections on which the budget is based changed and so the budget changes going forward?
The Law of Multiplication of Subordinates:
> we must picture a civil servant called A who finds himself overworked. Whether this overwork is real or imaginary is immaterial; but we should observe, in passing, that A’s sensation (or illusion) might easily result from his own decreasing energy—a normal symptom of middle-age. For this real or imagined overwork there are, broadly speaking, three possible remedies
> (1) He may resign.
> (2) He may ask to halve the work with a colleague called B.
> (3) He may demand the assistance of two subordinates, to be called C and D.
> There is probably no instance in civil service history of A choosing any but the third alternative. By resignation he would lose his pension rights. By having B appointed, on his own level in the hierarchy, he would merely bring in a rival for promotion to W’s vacancy when W (at long last) retires. So A would rather have C and D, junior men, below him. They will add to his consequence; and, by dividing the work into two categories, as between C and D, he will have the merit of being the only man who comprehends them both.
source: https://www.economist.com/news/1955/11/19/parkinsons-law
So they attempted to use DB's position to leap-frog into new product categories, which require big spend on R&D and related teams, as well as new heads for supportive teams (sales, marketing, support, etc).
It's not working, so they are pulling back and re-trenching.
That all seems pretty transparently NOT a "having too much money" problem.
One of my dad's anecdotes, back when he was alive, was when he was interviewing someone for a job.
"Why did you leave your last position?"
"After six months, management noticed my entire floor was doing the same thing as the next floor."
Often with this sort of thing, the company is essentially sacrificing future revenue to cut current costs; projects get delayed or cut, but, hey, the balance sheet looks better for a bit!
The other reason it happens (and here the cuts would mostly be operational and sales) is if the company just isn't getting as many customers as it had expected.
What you need can change over time. As I remember, Dropbox acquired a bunch of companies of the years, so maybe some of them originated from there. They also had many new products and tried to move into new directions, which probably also brought many new people.
Given how much money there is in these industries this strategy works for a long time.
The alternative is a harsher work environment that is common in other fields. Despite the popular belief on this forum, tech work has some of the most genteel management of all industries.
"But make no mistake. Though they're the ones leaving, it is I who must remain and bear the heavy burden of their failure."
I just about had to change my underwear after that scene.
Why do we think they'd do any better next time if there are no consequences to their poor leadership?
I can think of all sorts examples.
And if a company hires too many people for a few years and then right-sizes, isn’t that better for the economy overall than if they simply stayed small the whole time? They still paid salaries for those years and added to the overall level of employment.
Do you want a system where CEOs are hesitant to hire? Or where they’re afraid to right-size the workforce and instead run the whole company out of business?
There’s literally zero logic to your position, just feelings and Monday morning quarterbacking.
What consequences do you want the CEO to face? A token reduction in pay? Being fired?
Considering dropbox is not facing some economic recession outside of its control we can only blame the CEO's incompetence.
Do you genuinely believe that the record profits are due to the layoffs, and not just because we just lucked out to enter a new bubble?
Lmao what? Outside of being absolutely skint and unable to make payroll, that's pretty much the only reason to fire someone (I mean other than misconduct, which is also a type of incompetence)
Let's say you believe you have an opportunity that will double the value of the company, with a 30% probability, or cost the company 10% of it's value. This means it has an expected value of +21%. This is pretty good, and exactly the sort of thing shareholders want from their management. So you increase headcount and pursue the opportunity.
In the 70% scenario when that doesn't work, you have to downsize. Failure is not just possible, it's probable. That doesn't mean that the CEO mismanaged...they may have, I don't know the Dropbox details. But in the scenario where they haven't mismanaged, what do you want? Do you want companies to never take these risks in the first place?
Probably the part where they very directly attributed the layoff to mismanagement.
> We’ve heard from many of you that our organizational structure has become overly complex, with excess layers of management slowing us down.
> [We're] designing a flatter, more efficient team structure overall.
If it's "just a bet" and not mismanagement, then we should tell people that, shouldn't we?
The reality is that these bets are only bets for the people getting hired/laid off, and they don't even know they are betting in the first place. Even worse because we're not talking about simply losing money here. Losing a job is many times a life changing event in real people's lives. It's not like someone betting on a stock.
That's why there should be consequences for the ones making those decisions. They get the most rewards, but none of the punishment. How's that fair in any shape or form?
Employees have responsibility to due diligence their employers.
But at the end of the day, employment is at will. It's a risk we all take.
I understand the anger in this scenario as employees, but I don’t think doing layoffs means leadership is clearly incompetent. Running a company is hard.
Doing layoffs definitely says something about the company’s values and current standing, but I don’t think it necessarily means the CEO is bad.
It occurs to me that there is no failure of performance a CEO can produce and be held responsible for. Are these CEOs really so irreplaceable that when they bet incorrectly they can't be replaced?
20% of employees have been fired. The CEO directly cited mismanagement as the cause. And yet, its impossible to fire him because "its a learning experience" or "think of the upside!".
A CEO being fired does not mean the company falls into the abyss. The company still exists and can hire a new CEO. I'm certain there are plenty of fools more than willing to risk the livelihoods of 20% of Dropbox's staff in exchange for a mansion in Miami.
That’s the thing though, another comment nailed this perfectly. If they made a +EV decision to hire more people, but the preverbal roulette wheel landed on 00, maybe it’s not a bad bet that they should be fired for.
The explicit reason given was "economic headwinds" and bad organizational structure. If in your role as CEO you have left the company in a poor position to handle normal, cyclical slowdowns then you are a failure. If in your role as CEO you have produced an org chart which burns money and slows progress then you are a failure. You should be replaced. Period.
So if you were an IC and were on a project that failed (or even just didn't succeed enough), God help you. Many folks just quit when they saw a project going sideways, or tried to escape/transfer. Alternatively, people would report green statuses and hope someone else fell over first so they wouldn't be the root-cause.
Obviously this caused many problems. It was very hard to execute projects with lots of people or teams, and/or that took a long (>3mo) time. It came to a head when finally a major initiative missed another deadline "just barely" and it finally tripped circuit breakers and someone went in and did a full Inquisition. Yeah no the project was f'd and they basically just gave up ("pivoted") to an adjacent goal. Their official diagnosis/RCA was "people were too scared to report red, so everyone prettied up their status reports a bit, and that was compounded by each roll-up status report also prettying up the status.
Literally no leadership changes happened as a result of this. Then I got laid off. (Unrelated, just the big layoffs of 22. I was not directly involved in this, I was in big data and this was all happening in the main product infra stuff).
So yeah. Your project fails? Bye. But your f'd up performance grinder culture causes literally hundreds of people to behave so out-of-alignment with the actual company goals? Nah man stick around for 2 more years and leave at your leisure over some other petty squabble.
putting an employee elected representative on the board
negotiating the layoffs and severance with employees (e.g., giving folks the opportunity to voluntarily take layoffs to reduce the number of involuntary layoffs).
If they overhired so much the CEO has wasted a ton of shareholder money. Pay for performance, right? Perform poorly, you should expect less pay.
For example, if I lead a team that fails, the team will be disbanded and I will be either fired or demoted. (obviously if there are external factors I/we might be reprieved )
If the CEO leads an aggressive strategy that doesn't playout, they rarely get fired and certainly don't get demoted.
If the company miscalculated, or mismanaged, to the degree that it suddenly has to cut 20% of its workforce in order to survive (or give shareholders what they want), then yeah, that's a pretty big mistake, and your head should be the first one to roll.
I bet you'd have a lot fewer CEOs calling for mass layoffs.
I suspect you wouldn't see these comments if CEO pay was on the same order of magnitude as the people who actually work at the companies they run. Watching someone treat your livelihood like a toy, while also being rewarded with more money than any person will ever need, is a bit grating.
https://www.cnbc.com/2024/02/13/nintendo-ceo-once-halved-sal...
I mean, this is actually taking responsibility for your decisions as CEO.
But what would that even look like? A fine? That would probably make no practical difference, and would discourage them from making changes that need to be made. Fire them? Then you would probably get a worse decision maker in the driver seat going forward, who also didn't learn from experience of going through layoffs.
Layoffs are awful. They affect lives and families deeply. But all businesses don't go up and to the right forever. Reductions are a necessary part of running competitive companies.
How big of a bonus will this CEO get this year? Last year?
> As CEO, I take full responsibility for this decision and the circumstances that led to it, and I’m truly sorry to those impacted by this change.
Not to be an apologist, but I bet Drew really does feel responsible. He’s not professional management, and he always acted like Dropbox was his kid, at least from what I saw working there. I’m sure this feels shitty to him, though it’s obviously worse for the people laid off.
Not saying it's enough, not saying that's the only way, but I find it peculiar that this seems to be unthinkable.
> Iwata ran the Kyoto, Japan-based video game company [Nintendo] from 2002 until his death in 2015. To avoid layoffs, Iwata took a 50% pay cut to help pay for employee salaries, saying a fully-staffed Nintendo would have a better chance of rebounding. [0]
[0]: https://www.cnbc.com/2024/02/13/nintendo-ceo-once-halved-sal...
Edit: to expand on my point re virtue signalling: the article states the CEO took a salary cut, not total compensation (and it doesn’t elaborate on the value of the cut). Salary is a small fraction of CEO total compensation - the bulk of which is stock based, and even in the event that stock grants were also cut, the CEO surely already had significant stock. Cutting a relatively small component of compensation in order to boost the stock price which disproportionately adds to the CEO’s personal wealth seems like virtue signalling to me. If the CEO said “shareholders be damned, morale and culture are all that matters in the long run, no layoffs etc etc” that would seem more meaningful.
What would someone need to do in order to avoid being reduced to a virtue signaller?
Right now, there is no actual downside for executives. Just less upside. Did they earn XX Million this year or XXX Million. Some tangible downside would be nice.
I mean, heck, why aren't they fired? And really, it's more then middle management where that'd make a huge difference. If bad performance led to actual shakeups in the entrenched middle management, we might actually see business practices change rather than continue on through the established fiefdoms and petty corporate politics.
[0] https://www.businessinsider.com/these-20-companies-have-bigg...
In other words this kind of behavior wouldn't be viewed as all that surprising locally.
There's an Indonesian joke based on the word "responsibility" which is "tanggung jawab". "Tanggung" in this context means to carry the consequences, and "jawab" is to answer. One can say to a friend "We have to share this responsibility. I'll do the answering, and you'll do the carrying of the consequences."
It's often offensively insincere.
Why?
> who also didn't learn from experience of going through layoffs
That's actually a valid point. We don't commonly fire normal employees for mistakes. The counterargument is CEOs aren't normal employees.
Cool, can we pay you intern wages then?
[EDIT] To make this a bit more substantive: I think this is a sign both that we need to stop with this whole professional-managerial-class horse-shit, promote people who know how to do the actual work of the business, and reduce exec wages because the job's simply not all that damn special and the comp shouldn't be so high that only godlike-perfect performance could possibly justify it, because in truth nobody's that good at it.
Step one of this would be reducing M&A activity (hellooooo antitrust enforcement) and reigning in the power of finance, since letting Wall Street suits put their HBS frat brothers in charge of everything is at the heart of why this stuff's how it is.
“As CEO, I’m truly sorry to those impacted. But I strongly believe that this change is what is needed now to make sure Dropbox can thrive in the future.”
"I'm the sole person who made this decision" is probably closer what they are trying to say.
There’s no need for a CEO to bring themselves and their feelings into the conversation. It’s this weird attempt at empathy that fails, because the CEO isn’t making any sacrifices.
Just say that there are layoffs. Most rational people who have been in any business for more than a few years recognize them as an unfortunate part of the business cycle.
Mass layoffs -- unless the company is actually tanking and on its last leg, which isn't the case with any of the tech companies who have been doing this recently -- cause the share price to rise. CEO pay, or at least bonuses, are often tied to the share price.
So a CEO is rewarded instead.
So all this crap is just cargo-culting our current management paradigm, and/or execs cooperating to suppress wages and weaken labor, which had gotten a bit too uppity after Covid (that's one thing waves of layoffs like this do accomplish).
Perhaps you've misinterpreted that statement? It is the board that takes on greater risk with executives as compared to other employees. The executives are given the keys to the kingdom, which means only an exceedingly small group of trusted individuals can be considered for the job. By the transitive properties of supply and demand, when supply is limited, price goes up.
No - as a consequence of poorly planning cost controls. It's not that the people don't need to be laid off for the health of the company, but that the executives who made the bad decisions don't get the boot along with them, in favor of more cautious or frugal leaders.
Well they're the one asking to "take responsibility" here, the fact that they claim responsibility yet nothing happens is exactly why people don't like this phrasing.
Also who the fuck else can be responsible anyways ? The cook ? The guy who mops the fucking floor ?
“you would probably get a worse decision maker in the driver seat going forward, who also didn't learn from experience of going through layoffs” or you would maybe get a better decision maker who didn't have to layoff — or hire unnecessary — workers in the first place? Ridiculous speculation.
Responsibility without consequences just means failing upward. That's why we have a gilded executive class of people who are barely qualified to run a local Taco Bell franchise.
Simple: they sure love to talk a big game about responsibilities and taking responsibilities. Until it's time to actually do it. For the good of the company of course (if the company is in such dire straits, as the most highly paid employee - and probably not the hardest working one - why don't you take a big pay cut? For the good of the company of course).
That's what people don't take well.
It's amazing this still has to be explained.
The other two options: blame employees(someone not you), or take some form of punishment as an individual.
I too do it sometimes, and I feel bad each time. I at least tell people what it is and that it's just the reality of the situation. I'm not gonna commit career suicide and jeopardize my family's livelihood but I also won't blame them. So I follow the meaningless middle road where the status quo mostly stays and we all at least learn from it.
At least they learned not to trust you, though.
Obviously you as a CEO failed at doing second.
Now question is do you fire yourself and try to get a better CEO or you choose to fire 20% and generate more profits.
If it's up to the workforce they probably choose to fire CEO. But if it's upto the CEO he choose to fire the 20%.
Do you also object to sales reps or athletes making less money after a long period of performing poorly?
Um... yeah. Yeah, that's pretty much exactly what I want.
I used to work at a Dairy Queen. One dude there had been working there for a couple years. Unfortunately, one shift his drawer came up a dollar short. Our cutoff was 5 cents - a nickel - over or under. He was immediately terminated, of course.
He cost the company one dollar. A Dairy Queen cashier making minimum wage is held to a higher standard of accountability.
Conflict theorists think that every event is a result of power struggler. So if someone gets hurt, someone must be punished for that.
Mistake theorists think that the world is complex and sometimes bad stuff happens because most people operate with good intentions most of the time. Often, that means no punishment needs to be metted out.
To mistake theorists, conflict theorists look like ideological blood thirsty savages. To conflict theorists, mistake theorists look like enemy troops.
This is a gross oversimplification but it always shocks me to see how much more conflict theorists there are on hn now than before. So many comments here blaming the CEO or capitalism, most of which are going off extremely scant information.
Keep ‘em coming fellas.
https://news.ycombinator.com/newsguidelines.html
> Please don't post comments saying that HN is turning into Reddit. It's a semi-noob illusion, as old as the hills.
https://news.ycombinator.com/item?id=926703
https://news.ycombinator.com/item?id=633099
https://news.ycombinator.com/item?id=582513
https://news.ycombinator.com/item?id=289254
https://news.ycombinator.com/item?id=253657
https://news.ycombinator.com/item?id=66057
But I will be glad to see that my salary and bonus increased a bit this year :)
https://www.forbes.com/sites/michelatindera/2021/02/17/here-...
Plenty of examples of how long "lifetime" licenses really last in the modern era. See TeamViewer for example.
I feel like the product could do just fine with 100 employees.
You're not wrong.
I've seen companies with less than 10 employees make around $9M ARR within the first 3 years, and some with around 50-100 employees that can't even reach 100K ARR.
The smaller your startup the more faster you can go, Dropbox's main issue is that they haven't implemented Founder Mode yet. I am willing to bet that that there are jobs in Dropbox that doesn't need to exist.
Companies develop a lot of bespoke features used by a handful of their customers. It might not be obvious to the average person what all of those features are. Additionally just scaling software to continue running with more customers using the product is not a trivial task as well. Adding more servers or making servers beefier only works until it doesn't.