Some of the thinking about getting back to real startup dynamics sounds good, but this part didn't:
> Labor market is in your favor: renegotiate compensations, starting with the B players. Whoever leaves will not be hard to replace. [...] Layoffs are disgusting for everybody. Multiple waves are not OK. Be courageous and sensible: any additional wave further depresses your team and worries your customers. And, at least a few thousands of the 175,000 laid off are surely better and cheaper than your bottom 20% performers. Probably more hungry too.
> Founders who managed to be relatively less diluted thanks to recent sky-high valuations: carve-out a portion of your own equity to compensate your pivotal talents or new hires
If you just listened to the savage management consultant type, and laid off everyone you possibly could, and then hope to take advantage of the misery of others, to hire more desperate replacement workers...
Those "pivotal" people with experience are going to see there's no loyalty nor trust in the company. Which doesn't bode well for a startup.
Uh, yeah, rather than more equity, cash is good. And, uh, let's switch to weekly payroll, given slippery slopes and the foot-dragging that the management consultant advised about payables to vendors.
I feel like you missed the grand theme of the piece: "How to keep the lights on at your startup, by doing whatever it takes"
There's a whole ethics discussion to be had here (is it better to fire 40% and save 60%, or end up closing shop and 100% losing their jobs), but "taking advantage of the misery of others and hiring desperate workers" just sounds like you're not understanding how damn hard it is to be in the CEO seat.
And how damn hard it is for CEOs to have to do layoffs.
Especially more in rather small companies, where you do know very well the people you are taking the job away from. Zuck for ex certainly didn't hire himself, know the kids of, etc the thousands he laid off.
And still, your duty as CEO, starting with your duty to your teammates, is to maximize the chances that most people keep their job. The best way to do that is to build a healthy and enduring business & economics.
At least as long as people still want to be paid with $$. And this is no bad joke: the pioneers of any industry, like were those joining tech startups in the 70s, were in it for the cause, the dream, the revenge, etc. Today this is not the case anymore: tech is a 'job' for most. Which is absolutely fine. A victory actually: it means tech has become a 'normal' industry.
Unfortunately, the recent cycle was not about 'health'. so as in all excesses, the body needs to rebalance.
The grand theme of the piece could be about keeping the lights on, and it could be about moral abdication, to be ruthless and a little underhanded, because the McKinsey guy told the CEO it was OK.
I think it's justifiable for employees to feel some amount of loyalty to the concept of the startup when they join it, since they are inevitably taking a significant amount of risk when joining an early-stage company (growth stage startups will be fine).
What I don't get is how not many founders believe that loyalty is a two-way street - you should expect to be as loyal to your employees as you expect them to be to your startup.
> Labor market is in your favor: renegotiate compensations, starting with the B players. Whoever leaves will not be hard to replace. [...] Layoffs are disgusting for everybody. Multiple waves are not OK. Be courageous and sensible: any additional wave further depresses your team and worries your customers. And, at least a few thousands of the 175,000 laid off are surely better and cheaper than your bottom 20% performers. Probably more hungry too.
> Founders who managed to be relatively less diluted thanks to recent sky-high valuations: carve-out a portion of your own equity to compensate your pivotal talents or new hires
If you just listened to the savage management consultant type, and laid off everyone you possibly could, and then hope to take advantage of the misery of others, to hire more desperate replacement workers...
Those "pivotal" people with experience are going to see there's no loyalty nor trust in the company. Which doesn't bode well for a startup.
Uh, yeah, rather than more equity, cash is good. And, uh, let's switch to weekly payroll, given slippery slopes and the foot-dragging that the management consultant advised about payables to vendors.