Someone told me FaunaDB the company had a strict "no one gets fired" policy. However, they also hired a few toxic people, and that created a dilemma for some folks because it was either leave or learn to tolerate toxicity.
Don't fire employees immediately when they make mistakes, sure. But not firing them at all, even if they are obviously bad for your company? That's just bad management
* Second only to having to field questions about and spin upper management decisions that you also disagree with.
Apparently their VC investors were not seeing the hockey stick growth, so they decided to cut the losses. Taking VC money is a more risky bet than other forms of investment. If your business is profitable, but small and is growing 5-7% a year, and no acquisition is sight, most likely it's going to be shut down.
But if you take the rocket fuel of VC financing, you either accelerate so fast as to reach the orbit, or you crash back to earth. There's no glider option then.