| ▲ | K0balt 3 hours ago |
| It’s because, and I say this as a person who has made these calls, some leaders do feel a genuine responsibility for the people that work for them. Perhaps too, the ones that don’t, want people to think that they do. But as a founder and CEO by far the most emotionally taxing thing I have ever had to do is cut staff for the good of the company. You want to treat people the way you would want to be treated if you were in their shoes, but it doesn’t change the realities of the operation. This case is clearly AI enabled “right sizing”, and it is inevitable for companies that aren’t seeing explosive growth. It seems like they are handing it well, better than most. Good for them. |
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| ▲ | codegeek 2 hours ago | parent | next [-] |
| I am a founder/CEO myself (a very small company so I don't have experience of mass layoffs for full disclosure). However, I don't get this explanation. If you feel genuine responsibility for the people, then figure out a way to NOT fire them. Or be honest and admit that the company needs to make more money/cut costs. Trust me, no one wants to hear "we love you so much but we have to fire you and I feel so bad". It just doesn't land. Be honest, be open and be willing to provide a good severance. |
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| ▲ | dosisking a few seconds ago | parent | next [-] | | It's like that scene in Moneyball where they have to tell the player that they've been traded/cut | |
| ▲ | ryandrake 2 hours ago | parent | prev | next [-] | | It reminds me of that meme template. “I feel responsible for this layoff.” “Responsible enough to mitigate it or lay yourself off?” “Well, no, not that responsible…” | | |
| ▲ | an hour ago | parent | next [-] | | [deleted] | |
| ▲ | stronglikedan 2 hours ago | parent | prev [-] | | What an illogical and unrealistic meme template that is... | | |
| ▲ | scottLobster 2 hours ago | parent | next [-] | | It's not illogical, it's called leading by example. You consider it unrealistic because most corporate leadership, especially in America, never feels like doing it. Samsung executives by contrast have a tradition of taking serious pay cuts during bad years. Which is still largely performative given their existing wealth and status, but is at least is a measurable material sacrifice. | |
| ▲ | linkjuice4all 2 hours ago | parent | prev [-] | | Yes, much like the “we’re all family but we’re reducing headcount by…” Treat people like professionals: admit that you did a bad job but that you’d rather protect yourself and not give up any of your salary/benefits and instead you are going to layoff your “family”. | | |
| ▲ | an hour ago | parent | next [-] | | [deleted] | |
| ▲ | ponector an hour ago | parent | prev [-] | | We are all family! They just forgot to mention it is a pretty dysfunctional one. |
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| ▲ | keiferski 2 hours ago | parent | prev | next [-] | | This is a good idea in theory, and in a lot of situations it's definitely under-used. But I don't think it's realistic to expect companies to never have to lay off employees. | |
| ▲ | dylan604 2 hours ago | parent | prev | next [-] | | > then figure out a way to NOT fire them like reduce the salary of the c-suite staff by 50% so they are only making 300% more than the average workers. or reduce c-suite salary to the lowest wage while allowing them to live off of their stock and other benefits like company cars, expense accounts, etc. granted, that's for the larger companies, but the bigger companies never do anything like that | | |
| ▲ | fourseventy 2 hours ago | parent | next [-] | | 1.) The c-suite is like 6 people, reducing their salary isn't going to make much of a dent. 2.) The c-suite are compensated at market rate the same as anyone else. If the CTO at Patreon is making 400k/yr you can't just cut his salary to 200k, he will leave and take a job somewhere else. | | |
| ▲ | KellyCriterion 18 minutes ago | parent | next [-] | | Ah, no, for sure you can just cut the salary by 50%? And believe me, most people in well-managed company would accept it to keep the company alive. And y CTO with 400k wont "just find a new job with same payment" next day, thats an illusion. Especially nowdays in these times. If I would be asked: "reduce your salary by 50% or get fired", for sure I would stay if there is a perspective that the situation may recover in the future. If the company has no perspective future, then you would leave anyway (either implicitly or explicitly by them) | |
| ▲ | surgical_fire 7 minutes ago | parent | prev | next [-] | | > The c-suite is like 6 people, reducing their salary isn't going to make much of a dent. Depends on how much those 6 people make. Have you seem C-level compensation in comparison to worker's salaries? | |
| ▲ | Gud 39 minutes ago | parent | prev | next [-] | | Many of the C suite are just nepo babies. | |
| ▲ | buellerbueller 2 hours ago | parent | prev | next [-] | | >1.) The c-suite is like 6 people, reducing their salary isn't going to make much of a dent. It makes much more than a dent to the ~20 people not laid off, and a likely morale boost to everyone remaining. Edit: who are the sociopaths who downvote this? You don't think that someone not being laid off isn't going to have a much better outcome than had the been laid off? At least make an argument to the contrary... | | |
| ▲ | john_strinlai 23 minutes ago | parent | next [-] | | >Edit: who are the sociopaths who downvote this? there are some people on this venture capital company forum that are venture capitalists. layoffs to boost profits is just another monday | |
| ▲ | surgical_fire 5 minutes ago | parent | prev [-] | | > Edit: who are the sociopaths who downvote this? There's a large contingent of HN users that are all too happy to brown nose their corporate overlords. Also, this is still a ycombinator forum, it wouldn't be surprising if some people around are the ones that lay people off. You know, the sociopaths themselves. |
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| ▲ | miltonlost 2 hours ago | parent | prev [-] | | The corollary to 2 is: reduce all CEO pay across the board because of how disproportionate it is. |
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| ▲ | vanuatu an hour ago | parent | prev | next [-] | | if a company is doing poorly enough to lay off people the c suite has already taken drastic pay cuts from their stock compensation | |
| ▲ | dewey 2 hours ago | parent | prev [-] | | > Like reduce the salary of the c-suite staff by 50% Perfect way to lose your staff to your competitor. | | |
| ▲ | UmYeahNo an hour ago | parent [-] | | Let 'em have em. They already messed up this company, let them go mess up the competition now. Sounds like a plan. Encourage the lowest performers to go. | | |
| ▲ | dewey an hour ago | parent [-] | | There's perfectly fine reasons for a company to fail that are not the fault of anyone working there. Small startups relying on revenue from a bigger client at the beginning that shifts their spend, market changing quickly etc. | | |
| ▲ | UmYeahNo 30 minutes ago | parent [-] | | Which I think are all in the domain of the C-Suite to anticipate and handle, aren't they? If they aren't preparing for those situations then maybe they aren't the right folks for the job. |
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| ▲ | roenxi 2 hours ago | parent | prev | next [-] | | The paradox can be resolved by assuming they are fallible and limited human beings - they're laying a bunch of people off, they understand at some level that this is evidence that their poor hiring and management decisions have caused some amount of unnecessary suffering, so they feel bad. But they aren't foresighted enough to have handled the situation appropriately in advance. Or they might have run into the limits of their ability to empathise and only understand that they feel bad but not that the fired people probably feel worse. I'd bet more on the former. In many ways it is a triumph of modern society how ordinary the people are who head these large and complicated world-spanning corporate entities. | | |
| ▲ | scottLobster an hour ago | parent | next [-] | | Is it? Another is that modern society has created a system where advancing to the top ranks of corporate and political leadership requires mediocrity, and excellence is actively discouraged past a certain level of authority. The mediocre have just enough capability to do something right, but little enough that they're constantly surpassed by their more talented peers and never feel safe. So they go into "soft skills" that their more talented peers aren't interested in, and sandbag themselves with authority once they get it. For an extreme example, nobody is ever firing Mark Zuckerberg no matter how many obviously stupid bets he makes, and even if they did his family would have enough wealth for the next 10 generations at least. This problem is hardly new or exclusive to tech, but we've endured enough decades of Silicon Valley navel-gazing TED talks without now trying to whitewash them as "well they're just ordinary people". Yeah, and I wouldn't trust an ordinary person to fly a plane, why should we feel good about them running companies? | | |
| ▲ | roenxi an hour ago | parent [-] | | > So they go into "soft skills" that their more talented peers aren't interested in, and sandbag themselves with authority once they get it. Maybe their more talented peers should learn some of these soft skills and take an interest in authority positions instead of acting like losers? Is there some smart-person conspiracy to put idiots in charge that nobody has clued me in to? I don't want to be going too far in telling my talented peers their business, but if capable people aren't interested in doing anything to take a leadership position then the leadership is going to be incapable by definition. | | |
| ▲ | scottLobster 21 minutes ago | parent [-] | | In my experience, when someone (not being euphemistic, I've witnessed it many times) too mission-focused tries to get beyond program-level leadership they inevitably get sidelined and either coast to retirement or demote themselves back down. At a certain level making good products on time and on budget is no longer the game, and feeling an obligation to do so is looked down upon as naive. Additionally, failure is not punished in any material sense. Boeing's leadership doesn't care about their aircraft quality beyond legal liability, Meta hasn't cared about the quality of the facebook newsfeed in over a decade, Elon Musk doesn't care about making cars or colonizing Mars anymore, and rest assured Pateron's leadership will be just fine in every material sense, the worst they have to worry about is reputational loss that will likely be short-lived. Put it all together and you get an incentive structure where outside of small companies/divisions, and the rare exceptional leader, the people who care about the products the least are the ones that make it into leadership, and good luck convincing that club to change their priorities. |
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| ▲ | buellerbueller 2 hours ago | parent | prev [-] | | >In many ways it is a triumph of modern society how ordinary the people are who head these large and complicated world-spanning corporate entities. But I was told that CEOs were descended from Mount Olympus itself! Billionaires too! | | |
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| ▲ | stronglikedan 2 hours ago | parent | prev | next [-] | | That's a whole lot easier to do in a small company, but not very realistic beyond that. | |
| ▲ | zer00eyz an hour ago | parent | prev [-] | | I have been through the process of cutting staff in a few different roles (director, outside consultant), more times than I care to count. > If you feel genuine responsibility for the people, then figure out a way to NOT fire them. I have never seen that end well. One deep, clean cut, is far better than many little ones. If you have to do back to back cuts because the first wasn't deep enough people start to panic. If you cut back the niceties, you're telling folks there is trouble and you're likely putting off that inevitability (and making the eventual cut deeper, with smaller pay outs for everyone). The moment you sense the issue, look at the numbers. Figure out what the worst case scenario is, and look at that. Does a deep cut get the people going severance, and the "lets save everyone" approach mean your locking the front door and handing out last paychecks? > Or be honest and admit that the company needs to make more money/cut costs. This isn't the convo you have with the people who are leaving, this is the conversation you have to have with the people you didn't let go. Your choices are A) look like an asshole for cutting too many people or B) look like you did not cut deep enough and people panic or see that it isnt the last round. There is NO in between. The only thing that spares you in scenario A is that you gave people enough runway in their exit - 16 weeks (from the article) is a great starting point, but a week per year is an insult. |
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| ▲ | SetTheorist 2 hours ago | parent | prev | next [-] |
| The "realities" being that increasing profits for a few people is more important than the lives of the people doing the actual work? |
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| ▲ | whatever1 2 hours ago | parent | prev | next [-] |
| Why a company has to survive but not its people? For example when it comes to the IRS bill, the company will literally cease operations and sell all of its assets to pay IRS. Why the employees do not deserve this? |
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| ▲ | scott_w an hour ago | parent [-] | | > Why a company has to survive but not its people? If the company collapses, those people lose their jobs anyway? > Why the employees do not deserve this? It's not about what employees "deserve," it's about the simple fact that the law allows the tax authorities to wind up a business to cover the tax bill. See the UK, where HMRC wound up Rangers FC (https://en.wikipedia.org/wiki/Administration_and_liquidation...). | | |
| ▲ | whatever1 an hour ago | parent [-] | | Exactly. With stroke of a pen a company is less important than its ability to pay taxes. So we can put people above companies. With a stroke of a pen. |
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| ▲ | Grombobulous 2 hours ago | parent | prev | next [-] |
| I think what you’re describing is only a fraction of leaders and possibly a small minority of them. This concept is especially not applicable to profitable companies who have layoffs anyway. Hyper-optimization and AI adoption isn’t actually a business requirement if your business is making a profit. Plenty of businesses refuse to play that game and still make themselves a good living. Founders who want to claim emotional connection to their employees should think about things like converting the company to full employee ownership rather than thinking of themselves as a paternal benevolent dictator. |
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| ▲ | vladms an hour ago | parent [-] | | The profit by itself does not tell the whole story. There are loan repayments, investments and possibly other financial deals. > Founders who want to claim emotional connection to their employees should think about things like converting the company to full employee ownership In a previous (very small) company I worked we have tried something similar that and, guess what, some people refused. They just preferred market level salary, freedom and no ownership worries, rather than take some risks. They were good employees so we just continued with them. But I learned that not everybody has the same views and wishes, and life is quite complex (I was a founder and was always interested by ownership, so was quite surprised about their reaction). | | |
| ▲ | SoftTalker an hour ago | parent [-] | | Just as most organizations beyond a certain size will have a few people who reach a plateau where they are content and do not want any more responsibilities or pay. They don't want a new title, they don't want more prestige, they don't even want a raise. They just want to do what they do. |
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| ▲ | rendaw an hour ago | parent | prev | next [-] |
| Why is AI enabled right sizing inevitable for companies that are profitable but not seeing explosive growth? |
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| ▲ | SetTheorist 2 hours ago | parent | prev | next [-] |
| The "realities" being that increasing profits for a few people is more important than the lives of the people doing the actual work? |
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| ▲ | 1shooner 26 minutes ago | parent | prev | next [-] |
| >feel a genuine responsibility for the people that work for them No offense, but this sounds a bit delusional. Has any (successful) CEO has ever written a letter like this to their investors explaining how unfortunately they are cutting an additional 20% of their revenue in order to remain 'responsible for the people that work for them'? |
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| ▲ | 2 hours ago | parent | prev | next [-] |
| [deleted] |
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| ▲ | ecocentrik 2 hours ago | parent | prev | next [-] |
| Even founders that don't naturally empathize with employees they need to cut encounter a process that is emotionally taxing. It's just not an easy thing to do. If you handle layoffs badly it can impact your earnings potential, your social image and your psychological health. |
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| ▲ | 999900000999 2 hours ago | parent | prev | next [-] |
| As someone who has been laid off or fired a few times. Just tell me when my last day is and cut my check. At this point I assume every employer wants to screw me in one way or another. My first salaried job replaced me behind my back since I went remote to look after a dying family member. Corporations by definition are sociopathic entities. They can not ‘care’ about anything aside from maximizing profits. Once I was on a call receiving the bad news and I immediately texted another job opportunity right then and there. We’re not family , and we’re definitely not friends. |
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| ▲ | nightski 2 hours ago | parent | prev | next [-] |
| These posts seem more like emotional therapy for the founder, helping them cope. It's not about the people being let go at all. |
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| ▲ | ecocentrik 2 hours ago | parent | next [-] | | You should really look into who Jack Conte is and why he created Patreon. He's a smart guy who relies heavily on maintaining a positive social image and is more emotionally aware and stable than most tech founders. I imagine from his perspective the decision, severance and post were all just the smart thing to do. | | |
| ▲ | 2 hours ago | parent | next [-] | | [deleted] | |
| ▲ | ghostly_s 2 hours ago | parent | prev [-] | | His name is Jack, and I would describe him as a deeply weird narcissist. You got the "relies heavily on maintaining a positive social image" part right. | | |
| ▲ | ecocentrik 2 hours ago | parent [-] | | That was a typo... thanks. I wasn't suggesting that he or anyone else is 100% altruistic but he seems like he genuinely thrives on collaboration. |
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| ▲ | 2 hours ago | parent | prev [-] | | [deleted] |
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| ▲ | ltbarcly3 2 hours ago | parent | prev [-] |
| They feel a genuine responsibility to avoid the buzzing sound in their head that results from trying to believe and make other people believe they feel a genuine responsibility for people while taking actions that are the polar opposite of anything that you do to someone you feel responsible for purely to increase your own and your investors wealth. It's fine to fire people, and the severance here is very generous. Business leaders who need to feel like they are a generous parent or 'different' are weak and lying to themselves. Finally while the severance is generous and to be applauded, all of the phrasing under the guise of caring about people was very transparently just an excuse to say over and over "we are making money and we aren't doing this because we have to" to his investors, which just rubs it in the face of the people being fired over and over. One final insult I guess. |
