"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.
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.
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.
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.
In plain English it means sales are crashing with no change forecast in the immediate future.
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
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.
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.
But why is every ceo feels obligated to use this kind of meaningless corpo speak in these emails? "Macro Headwinds", "full responsibility"?
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.
https://www.forbes.com/sites/michelatindera/2021/02/17/here-...
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?
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.
Surely that should fix things?
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.
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.
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.