Restructuring Announcement
automattic.com
automattic.com
I apologize for my erratic behavior which has tarnished our brand and created unnecessary turmoil within our organization. Regrettably, we will need to implement a 16% reduction in headcount to address the financial challenges we now face. I have decided to step aside and hand over control to my deputy, who I believe will provide the steady leadership needed to rebuild trust and restore our company's vision.
He considers Wordpress "his" even though...he took it over from the original author who was abandoning the project.
It reminds me of the rage-bender Jamie and Jim Thompson went on, attacking OPNsense for "stealing" their work and doing a lot of immature things taking over opnsense's domain, their subreddit, etc. via legal actions. And at least one lawsuit. They lost on every front - reddit gave the subreddit back to the opnsense developers, ICANN gave them back their domain name, etc.
Attacking OPNsense for "stealing" pfSense was pretty rich given pfSense's origin; netgate slapped their logo on m0n0wall and started working on their fork. Which is exactly what opnsense did that enraged them...
Especially as pfsense software started getting more user-hostile and shifting functionality into the paid versions, pfsense has rapidly become less and less popular. I almost never see anyone recommend it anymore.
Non Wordpress user here, not a blogger, don’t use CMSs. Curious about this line. Reading the history on Wikipedia, the original b2 was the precursor. It was pretty small and being abandoned. Matt proposed forking it in January 2003, and worked with Mike to bring the first version to fruition a few months later. 22 years later it’s a goliath.
Given that history it seems totally fair for Matt to consider WP his thing. You don’t seem to think so, can you explain?
>> There are no layoffs plans at Automattic, in fact we're hiring fairly aggressively and have done a number of acquisitions since this whole thing started, and have several more in the pipeline.
https://old.reddit.com/r/Wordpress/comments/1hxnh73/automatt...
It seems to me the obvious, from both a business & human perspective, is to stop hiring at first signs of trouble, before layoffs. To do so otherwise is cruel.
I doubt Matt had zero idea about this possibility two months ago.
The best part is that the pawns keep getting sacrificed and do nothing to change it; not only that, they refuse to support anyone trying to change the game to make their lives better. It's amazing.
I'm of the mindset that any time a company does layoffs, they should start from the top And work down.
Oh, to be young and idealistic again! So in your world, the people running the business should fire themselves first?
so, yeah. the people ultimately accountable for fucking shit up should probably be held accountable first and foremost.
(this is why CEOs often resign in the wake of a scandal)
If they are needed to continue leading, they should consider cutting their own salary until the problems are fixed. Let them take their entire compensation in just their equity for a time.
However we all know this won’t be the norm, and that’s OK. Not great, just OK.
This let us get through a short rough patch without layoffs.
I once heard wise words from some CEO. In harsh times, clients do not want cheaper and worse services from us. They want less services. So we are moving out headcount down, while keeping pay and even execute raises for those who stay.
From where I am standing, leeches that are only there for fat bonuses left. Where's the loss?
And the measure you described also doesn't follow. Bad times always end and then you have a worse product. Will the execs pick up the new tech work?
That's one story surrounded by a hell of a lot of shitheel stories.
Bob Mercer and Peter Brown laid themselves off from IBM when they were told to execute 10% across the board layoffs. They had argued their team was one of the highest performing teams in the company but were told that they had their quota. 10% of their team was 2 so they took the hit.
From there, they went on to run Renaissance.
IBM should have kept them.
Not that they will-- too much self-interest.
You were questioning whether they should, not whether they will. That's what people are responding to. They understand perfectly well who will get fired first.
Its really important to discuss idealism for that reason alone
What you say is true in some cases, but not in all cases.
If enough people take talk into action, we could reasonably see a change in behavior. It may come from sources than we don't expect, but it can happen all the same and we only have a chance at getting there if we are wiling to talk about what is ideal and raising that awareness. Its an important piece of that puzzle
But even if they were idealistic, arguing with people for wishing the world was better is a genuinely odd thing. If you followed your beliefs, wouldn't you understand that telling people not to wish for things is pointless? If you actually dealt with the world as it is, you would not argue with people on the Internet because changing somebody's mind, particularly in the way you are attempting to do it, is just as much wishful thinking as hoping that CEOs will fire themselves.
That idealism.
"I believe I will be a millionaire by age 30" is idealism.
"I won't be a millionaire by age 30 unless I rob a bank, but I should" is not idealism; it's just a factual statement about one's preference for wealth.
And, again, why are you arguing with me at all? If you followed your advice, you'd understand that it is pure idealism to expect me to change my mind. As somebody once said, "There’s not much to be achieved by wishing the world was a certain way; it’s generally more useful to deal with the world as it is."
It's odd to scold people for stating their preferences, and it's even odder to scold them for something you seem to be doing yourself. If you actually believed in the things you advocate for, you would not be in this thread.
Now imagine there is a Super-boss, who is exactly like the "people running the business" (attribution needed), but one level above them.
If the Super Boss were to look at the situation, I think it'd be pretty obvious that the issue would be "The people organizing the company at the highest level" who are responsible for the failures of the company. That may involve over-hiring, which is itself a bad practice that causes unnecessary pain and (personal, financial) suffering, and would be a good cause to fire them for almost crashing my beautiful super-company that I, the Super-boss, super-founded.
You're saying that if we return the Super-boss to the realm of the fictional, then suddenly it isn't the C-suite's fault anymore?
If we're discussing should, then yeah, their heads should be the first to roll. I agree its idealistic to imagine them having the sort of decency this requires, but I agree it should be the case!
I'm off the mindset that employment should be voluntary: both by the employer and the employee. It makes employers reluctant to hire if they know they can't get rid of people again.
(I'm a socialist at heart and think it'd be pretty nice for the government to take care of people who lost their jobs. Just tax the companies a little more!)
Corporations and management basically exist to buffer this uncertainty. Employment is actually a really bad deal in good economic times; owners reap almost all the windfall of having a successful product. But in bad times, the company keeps paying you even if they're losing money, at least up until they don't. You get a raw deal, but not as raw a deal as the people paying you.
Likewise with strategic direction. The market's needs change faster than senior executives can adapt: if they always produced what the market was actually clamoring for, the company would run around like a chicken with its head cut off (this actually happens when the CEO panics, and a key CEO skill, and part of the reason they're paid so much, is the ability to ignore every piece of market data saying "You're not hot anymore. Nobody wants you, and the market has moved on" and keep doing what you're doing even though your intuition is telling you that you're doomed and going to lose your cushy $20M/year job). Much of the job of middle management is to buffer senior management's freakouts and tell the ICs "Keep calm and carry on; let's see if he still cares about this new hotness next week."
Mullenweg lost his mind and attacked a competitor to Wordpress hosting (WP Engine) and kept doubling down and only served to demonstrate how much of an unhinged asshole he was.
Along the way he pissed off the Wordpress community - the worry was that if anyone else pissed him off (which could include he'd accuse them of using the Wordpress name or even "WP", even if it was descriptive (which is entirely permitted use of a trademarked name) and run up a bunch of legal expenses for them.
Angry-at-the-world blog post after blog post doubling down over and over. Taunting people as he banned them from the Wordpress slack, that sort of stuff. Then he blocked WP Engine from accessing the Wordpress.org plugin and theme registries which meant a huge number of sites couldn't update plugins or themes.
Then he announced Automattic was going to cut back engineering hours to (if I remember right) one full time staffer. One person to keep up with security updates and bugfixes of a very complicated piece of software used by a lot of organization.
Incredibly childish and thoroughly demonstrated to the world that he was unsuited for leading a company and being the sole person almost completely in charge of a piece of software used by a 20-30% of the websites in the world.
This was absolutely foreseeable, especially when he cut back Automattic's engineering to 40hr/week.
I advised a client a few weeks into the drama to at least keep in the back of their minds that they might have to migrate at some point as "the CEO of the company is off his rocker, they probably will start to struggle with security updates, and the company may go out of business."
Once a single customer is 1/3 of your revenue they can start extracting considerations from you that may not be what your employees thought they signed up for. It's a good way to end up being a body shop. I don't have a philosophical problem with body shops per se, it's just that I don't want to work for one, so I pick places that should know better, but sometimes don't.
It can also be problematic if 2 customers account for 45% of your revenue and they both get the same idea, which can happen particularly when the market shifts. You have no way to call their bluff and move enough people to other projects to make it stick.
You know what I absolutely hate about this take? It ignores my shared experience I've had with others (IE, its not just me). I've worked in this industry a long time. So I've inevitably worked for places that ran into financial trouble. In multiple of those cases, it could have been prevented if upper management actually listened to what those of us developing the product had to say about shifting customer behaviors and expectations, that what we were seeing was different from what they were trying to sell and have us develop. It always ended in disaster.
They refused to listen, but never paid the price for that failure, my colleagues did and in one instance, I was on the receiving end of a layoff along with others as well.
https://www.ribbonfarm.com/2017/11/09/ceos-dont-steer/
A good CEO will let in just the little bit of information that saves the company - this was Andy Grove's pivot to focus on microprocessors over memory chips, or Steve Jobs's turnaround of Apple. You didn't have a good CEO, and got your average mediocre CEO that sets a strategic direction and sticks with it regardless of what the market says.
I'm curious though, if you knew your employer was going under, why not jump ship to the competitor that actually did understand what customers wanted? Employees are economic agents too, and oftentimes competitors are more than happy to hire out of their competition.
Still too simplistic. Yeah, they need to filter information and say no to things constantly, I get that is a core skill. If something is repeatedly being brought up by members of your core teams, you should at least look at what they're saying and ask where they are coming from. That is simply good sense. There is a persistence factor in involved in each of these cases that are the source of the frustration.
If what constitutes a good CEO is allowing in the 'little bit of information that can save the company' (really thats a call about identifying useful information before anyone else), objectively most companies have terrible CEOs, and I question the value of the position entirely on that basis, especially at larger public companies.
FWIW, at each of these companies I worked at, the headcount was at most in the hundreds. I was only 2 clicks below the executives in the company tree, there wasn't a lot of barrier to interaction there, which is what I find even more baffling about the whole thing.
>I'm curious though, if you knew your employer was going under, why not jump ship to the competitor that actually did understand what customers wanted?
I did this twice. In the one instance I wasn't able to get moving faster than things were going down hill. Partially, this is a symptom of just how long interview cycles have become over the years. Took me longer than expected, but moreover, the company conducted the layoff faster than I really thought they would. I got the timing wrong by a little bit, it happens.
Its not like you identify an issue one time either, its the repeated ignoring of what happens despite repeated sustained efforts to raise the awareness where it needs to be.
You are going to invest significant resources into hiring, onboarding, and injecting new staff into workflows for people that will not be there as soon as they are actually productive.
So its not just the cash burn - its the tieup of 3x team members to getting new people trained to become effective and successful contributor. Time is finite.
It makes no sense to throw away all that time spent by your team, who could have use that same time to get a few more features out, proposals sent , or projects spec'd instead.
I have had too many experiences where I thought my current employer was about to start circling the drain, and I've ended up some place that was circling faster. At a guess I'm about 50:50, which I suppose I should count as 'lucky' but has never felt that way.
Fish-tailing is a common flame-out mode for startups. VCs are partly to blame. They don't like to discourage you in case you come up with a miracle, but neither do they want to put good money and time after bad if it turns out you're going to be a break-even play or a loss.
We might argue about the parameters in this situation, but structurally there's a bias towards the low-pass average.
You can't assume fundraising will always go swimmingly. You have to always be in survival mode, and if that means not hiring aggressively, then you put on the breaks until the money comes in .
Either as a leader you are clueless about your business cash needs, you are clueless about risk management, or you are clueless about the market, all of which make you not a suitable leader for a long-term company.
https://fred.stlouisfed.org/series/FEDFUNDS
Now, you'd have a point if you complained about how centralization of government and economic power with the President and Fed chair, respectively, is a problem. That is the root cause that allows the economy to change faster than any leader can adapt. There used to be a time when people would complain about centralization of executive power on HN, but for some reason that moment seems to have passed.
"Unheard of in modern economics" is carrying quite a lot of weight there. The last time the rates were increased by 0.75% was 1994, and while that's not recent, it's pretty silly to imply that CEOs should be making long-term investments assuming that it would be literally unprecedented for that to happen. Interest rates have changed only a few dozen times _at all_ since then, so yes, they haven't been increased by that much recently, but there's never going to be enough of a sample size over a period of a couple decades that it would be reasonable to assume a precedent that will never be broken.
The crux of your argument seems to be that because the interest rates happen to be set a certain way at a certain time, it would be irrational not to make decisions based on how profitable they'd be at that exact moment in time. The problem with this line of thinking is that plenty of investments are only realized over long enough period of time that by your own admission, people can't possibly react fast enough to avoid those turning into a loss. My question is, why put yourself in a position where you can't adapt fast enough in the first place? The way interest rates are set should not be news to the people making these decisions in companies, so it's not crazy to expect that maybe the people who are betting their company's success on something from less than three decades before being "unprecedented in modern economics" could think at least _a little_ longer term than "literally anything is profitable in this exact moment, so there's no need to think about what might come next".
Small-fry who operate secretly are able to take the long view and enrich themselves off the masses' stupidity. CEOs of a multi-trillion-$ company that is ~10% of the retirement portfolio of every American are not. At that level you have to go with the market consensus, because you will be ousted and deemed not a fit steward of the enterprise that you are entrusted with otherwise.
From my math, you're off by several orders of magnitude, unless somehow we're not talking about Automattic anymore.
You're basically making the case that it happened fast, and went up high, but everyone who paid attention to interest rates understood it was only a matter of time till it had to at least revert back to pre-covid rates (whether you think that's 1.5 or 2.3 or something, depending on how you measure), and that obviously there would need to be real layoffs after.
The excuse is really saying "it turned out more extreme than we thought", but was the behavior take responsible assuming non-extreme rate changes?
Bingo
The issue is that they're a publicly-traded company, with a fiduciary responsibility to shareholders. If they're investing in an internal product that will make back 1% of the money invested in it over the next couple years, but they could have been investing in Treasury Bills that make back 4.5%, they are committing financial malpractice and will be sued accordingly.
The idea that choosing a 1% strategic internal investment over a 4.5% T-bill constitutes actionable "financial malpractice" or a breach of fiduciary duty leading to successful lawsuits is incorrect. Courts recognize that running a business requires strategic choices and risk-taking, not just maximizing immediate, risk-free yield. A lawsuit would fail unless plaintiffs could show the decision was tainted by disloyalty, bad faith, or gross negligence in the decision-making process, none of which are implied by simply choosing a lower-yield strategic project.
Hence why no one ever gets sued for this. It doesn't happen. It lives in the minds of HNers and Redditors to provide a very convenient excuse for their employers, or in general companies, making abhorrent decisions purely based on feels and short-term next-quarter profits/stock price, regardless of the negative externalities they inflict on soeciety.
If you are the CEO saying 'we are planning for bad things in the future' while every other CEO is saying 'the arrow only goes up' guess which company the stock market punishes and who gets removed by the board versus who's options become worth more?
By the time they lay off truly essential people, you're burnt out, and you're lucky if you don't have to sue to get what you're owed by law, let alone whatever policy they had for paying out vacation time or what have you. You also get to enjoy a fun period of survivor guilt when they laid off people who you think have contributed as much or more than you have, and then know that you'll be next if they laid of <person> already.
I never heard of this drama before.
This was crazy:
https://www.reddit.com/r/WPDrama/comments/1hlp08d/what_drama...
Trying to publicly argue the moral high ground was a stupid, unforced error.
It didn't need to be moralized at all. Just make the changes you want to make, piss off a vocal minority, then get back to winning and making boatloads of money by executing exceptionally.
The problem, I suspect, is that Matt values how certain people perceive him more than he values winning. It's unfortunate, because he's clearly a very good executer and strategist. He's getting in his own way.
The extremely erratic behavior, the ego, the fixation with vengeance, harassing organizations legally using the Wordpress name, abusing his power at the wordpress foundation, using it to punish Automattic competitors...
He pissed off a lot of people, but worse: he made a lot of people nervous.
Through his shitshow, he tried - and failed - to curry favor with an OSS puppet. Not any particular software... like one might think, but the whole "thing".
There was never any moment where WPEngine was beholden for offering WordPress services. Everything was strained to the point he was trying to redefine OSS.
He got in his way, ours as members of the public, and that of WPEngine. Repeatedly... and I don't see enough reflection/reason from Matt to believe this will change. Personally, I'd hesitate to promote his strategies or skills.
Hamfisted is a better message. Or none, take the wind away. We don't want his ambition or to hear about it. It's demonstrably shit.
Edit: just in case this needs saying, I've never been affiliated with either company. Don't waste your limited time looking for me, Matt.
Apparently not. I'd argue he was perceived as such but has thoroughly proven the opposite by now. There were so many stations to get off the train.
Probably the most salient detail for non-Automattic employees. Everything else was generic fluff.
I was thinking this is a boilerplate firing email though!
With so many countries and legal frameworks to comply with, there's never going to be a single answer for this.
non-Automatticians. Yes, they literally used this term in TFA.
It doesn't mean that employees have some cultlike adoration for the company. It's just very convenient inside the company to have a single short word to refer to all employees of the business.
> “Automattician”
The word you’re looking for is employee.
No, but it does mean that the company wishes that employees had some cult like adoration. The line between proud of the company one works for and being cult like is not rigid, and moves depending on the company
if so, that's what we in the narcissist-identifying business call a "tell".
Yes.
If that wasn't enough of a tell, his behavior in the last few months spelled it out clearly, circled the relevant parts with a big fat red marker, and installed a blinking neon sign saying "narcissist".
to decide whether it is actually a tell, we need to look at statistics of company names containing references to the owners/founders and their behavior. and i don't think that statistic bears out. naming your company after yourself is the traditional thing to do. "automattic" is just on the more clever side.
the tradition is changing only because it is becoming more and more popular to name your company after the product you are selling. now, putting your name into the product name, that maybe could be a tell. but even here there are exceptions: debian for example.
Justifiable evidence of Matt Mullenweg's unhealthy/excessive narcissism only surfaced within the past year or so (I'm fuzzy on the timeline, cut me some slack ya?). Automattic the company has been so named for, goodness, close to twenty years now.
It could be Matt's been a narcissist from the start. But people also change and not always for the better so maybe he became a "narcissist" much later in life and his chosen company name just so conveniently fell into the narrative.
There are CEOs in bigger spotlights with a bigger case for narcissism who don't put their names on any of their companies (emphasis on the plurality). One of them has a name with a similar inflection pattern to other well-known albeit fictional narcissist, Tony Stark.
I don't know what "Automattic" as a company name says about Matt as a person. I'll tell you what it is though: a damn good pun, one I would gladly score myself given the chance.
And he's full of himself and completely wrong in this crusade he launched for some reason, completely indefensible acts left & right for over a year.
Both true.
Probably apocryphal. A lot of people these days only know it from Star Wars.
Presumably, the real world is a bit more nuanced than that.
There is no reason why you cannot run a company for different motivations than "get as rich as possible" while still accepting investments from people whose sole motivation is "get as rich as possible". While difficult, it is possible to align people even when they have different motivations.
Conversely, investors can be mission-driven or otherwise aligned with you on something other than "maximize my return," but those investors rarely give you the best price.
My understanding is that the investors signed proxy voting rights over to Matt. They are mostly ordinary shares, and may be revocable. [1]
Layoffs are always awful, but seeing companies talk about "changing economic realities" amongst continuing revenue and profit growth - often all time highs - is a real morale killer for those who are left behind.
Microsoft/Amazon/Alphabet/Google are trillion dollar megacorps who are insanely profitable, but they're firing people because they no longer have to pretend we care about you at all and will instead try to cater to Wall Street (who will never be happy - if I had $10000 for every quarter where a big tech corp "beat expectations" and the stock dropped anyway I'd retire). It's a hard pill to swallow and will increase bitterness and cynicism in the remaining workforce and kill any chance of your employees caring about your vision or putting in any extra effort.
The tone being set is not a good one to be sure.
On the other hand, why should a company keep people around that they don’t need?
And the last point, speaking more about Microsoft/Amazon/Google, if you have worked for either company for any length of time, there is no excuse for you not to have a nice nest egg to tide you over especially considering the severance amounts they give you.
You might be forced to sully yourself and become an “enterprise developer” and make around what most of the 2.8 million developers in the US.
And yes, I did a bid at Amazon and within three years, I paid off some debt, saved a chunk of change, got my 3.5 months severance package and found another job quickly that was my target compensation (not enterprise dev).
The company isn't "catering" to wall street, wall street is their boss. The owners of the company vote on what they want the company to do, and hire the person in charge of the company. And besides, do you care about your company? If you got a job offer to make twice your salary doing something you'd enjoy more than what you do now, would you stay with your current company out of care for them? Maybe you would, but I know of almost no one who feels that way towards their employer, outside of those working for small tech startups with their friends.
For almost everyone I know, their mindset is that they're going to do the best job they can right up until something better comes along, at which point they'll switch to something better. And I fully expect that if my best work is no longer worth more to them than my salary, they'll lay me off. In the meantime, they're paying me a ridiculous amount of money to do a job I enjoy. It's a deal that 99% of the world is envious of, and I don't think it should inspire bitterness and cynicism
> It's a deal that 99% of the world is envious of, and I don't think it should inspire bitterness and cynicism
First of all, I think it takes a lot of guts to continue to have this attitude in the current economic climate. Or, in your case, immense skill, but not everybody - not even everybody in the big tech companies - has that.
I think the bitterness and cynicism stems from not enjoying the work. As crazy as this sounds - it's the intangibles as much as the cash: for example, knowing the company will fight your efforts to improve things.
"Our revenue continues to grow" doesn't matter if unnecessary expenses outstrip it.
I hope the RIF'd employees can pay rent with that gratitude.
If I were considering using Wordpress for anything, which I am not, this would end those plans. If they're laying off and keeping the CEO, they must be in dire financial straits. That message says "we're doing all the right things and have good leadership with a track record of making good decisions, but we have no alternative but to fire a sixth of our employees". That's not a good sign.
Who among us can really say they haven't gone off the deep end, burned every drop of good will that ever existed towards them and their projects, sued a competitor and got hilariously burned by the judge, all while burning hundreds of millions of your companies value (blackrock marked them down 10%, which is 750 million)
This is just a normal thing that happens. It could have happened to anyone.
I hope WordPress (and Automattic) turn the ship around but its not looking good at this point.
What does this mean in term of monthly wages?
I was a technical lead for the Romanian branch of an US company. They fired me along with my team and other teams. The reason was they were profitable but they missed the ARR by a million or something. Last year they did the first firing round, this the second.
When they announced they will fire us, they also announced they will hire more sales people. The ratio of business people/tech people was already 7:1 before that. They also said a programmer should produce 5 times the money the company spent with him, and we were at 4 point something.
Now I have found a position at a local company which takes care of its people even in harder times.
https://www.reddit.com/r/Wordpress/comments/1glejno/comment/...
...1 month later...
https://www.courtlistener.com/docket/69221176/64/wpengine-in...
Still, I'm concerned too. But I guess only time will tell...
Hard to read further than that…
You can wipe them fully (which would be the recommendation for MacBooks) and remove just work-installed apps on an iPhone.
Let that sink in. They're not even willing to <<sell>> old laptops, they would rather scrap them and contribute to pollution and overall waste.
One choice won't get you fired, the other might save you a bit of cash.
> A large bunch of big companies, including some of the biggest on the planet don't even sell past-end-of-life laptops to their current employees.
It's good that Automattic is doing it, I was wishing it was an industry standard procedure, for all past-end-of-life hardware, not just layoffs and not just laptops.
Right now FAANG, for example, which you'd expect to have the very best of everything, as far as I know don't give old laptops (and other old hardware) to employees, they don't even sell them. They send them to be recycled or whatever, but the best action is to reduce and reuse, recycle should be the last option.
Plus an employee is likely to be willing to accept their old device since they know it's performance and general behavior.
However what large companies do is to get an agreement with a refurbishing company, which will collect and refurbish them and and pay the corporation some share.
This works in some mix calculation - the well treated machines can be sold well, some machines can be used to reuse some parts and some machines are nothing but cost for disposal.
Is "please arrange for a courier to retrieve it" not the end of your obligations?
There are questions online about "what if a former employee doesn't return their laptop." They almost always end with "send a threatening letter in legalese." They stop after that because the the next step is get a $300 per hour lawyer involved for a $600 laptop.
I still have the laptop. And a hard copy of the emails.
Also, as an aside, it is ABSURDLY easy to bypass MDM and DEP on a Macbook Pro, even a later M series laptop. Absurdly so (anyone here could do it in about a minute or less, and have a de-MDMed, fully updatable, no weirdness laptop. Theoretically).
I wish more did; it really is such a small goodwill gesture to departing employees.
Trump, who betrays everyone for personal benefit, there's a sociopath. Mullenwag's just got some personality vices that served him as underdog, and didn't adapt to when he gained power