You don't need to write a novel with these. Also, writing an email about how you're going to can a bunch of people over the coming year and then droning on about how the results of that are going to be so much better (and insinuate that the current setup, which is 100% a management failure, was a poor setup) is insulting.
Also, this is a 2nd round barely 6 months after the first and it's going to happen over months. This will be great for morale and will likely only cause your A players (who are probably still very much in demand) to look elsewhere.
I worked at a company where the VPs loved to write long company wide emails. One time HR wrote "Why working at <insert this company name> is great Part 1". (If you write part 1 and part 2 corporate emails you're already doing email wrong.) They did a layoff between the time Part 1 was sent and Part 2 was sent. The scale of absurdity was difficult to measure with that one.
I was so happy when that company got acquired and the new company CEO showed up and announced that first level managers and below were all safe from layoffs, everyone above that was on a case by case basis, and "all executive staff were let go this morning, I saw no reason to keep those jokers around".
He was so right. Scored a lot of points there, never heard an executive of a large company say that so bluntly before.
> The scale of absurdity was difficult to measure with that one.
I have been told that one FANG which recently underwent a firing round barely took a break from their hiring rounds, and already started sending emails asking for volunteers for interviews even to teams which have just been decimated.
To be fair, unless the execs are also forgoing salary or bonuses, like Nintendo execs a few years ago for example, you can't really win with these layoff emails.
If the emails are succinctly composed then people would complain that the announcements were too curt and don't try to assuage people enough.
>I was so happy when that company got acquired and the new company CEO showed up and announced that first level managers and below were all safe from layoffs, everyone above that was on a case by case basis, and "all executive staff were let go this morning, I saw no reason to keep those jokers around".
Didn't the executives employ any anti-takeover measures?
I had a CEO like that. He came in, hired media people to interview him in 4k things to send to the employees. He kept trying to host talks to talk about his great vision. Did a lot of shake ups, and tried to force product changes. Ultimately his vision lost a lot of money, the product he tried to will in to existance got canceled, and they had nothing but layoffs after layoffs.
"I was so happy when that company got acquired and the new company CEO showed up and announced that first level managers and below were all safe from layoffs, everyone above that was on a case by case basis, and "all executive staff were let go this morning, I saw no reason to keep those jokers around"."
You are being manipulated. No. The previous executives are not "jokers" - they made massive profits selling shares. They are being let go because, after taking their massive profits, the new company will soon fire the rest of staff - and that is hard.
That’s the thing; the A players are still in demand (even Z players like me are still getting contacted for roles), and I wonder if sending this message out like this is a huge gamble on Meta’s part.
If I were there I’d be seriously considering a less volatile environment. If I were an A player, I’d be able to do so even easier and potentially find more meaningful work. This seems like a bad move for Meta, just leaving the axe up in the air ready to strike like this.
With numbers in the thousands, it gives me the sense that it might not always matter what you do or how good you are.
> This seems like a bad move for Meta, just leaving the axe up in the air ready to strike like this.
That may be intentional. I could see a scenario where voluntary attrition helps them get reduce size more organically and with lower cost than a layoff. Meta is still huge and pays good money. They can handle a huge level of attrition and still have enough "A players" left over to work on the thing that truly require that level of operation.
> With numbers in the thousands, it gives me the sense that it might not always matter what you do or how good you are.
Fully agree on this. At that scope, it's broad cuts with a lot of meat going with the fat.
This was posted the week after all management should have communicated AE to A players. I know for senior directors last day of performance review comms was Friday.
What is AE? Meta has a program for their top ~1% or so (who knows really) where they dump a pile of RSUs on your head, "additional equity", to retain you and bet on your future at the company. For most it's 2-4x your annual stock refresher, though I don't know exactly how it varies.
If you're E7+, this is another 1M+ stock grant on a 4 year vest on top of your 600k+ refresher grant. Stock is up from their internal refresher pricing. Their "A players" all just got ~5% bump on their 1.5M+ RSU grant.
G and other FAANG struggle to compete with Meta on comp for the actual A players. We'll see if they budgeted enough for AE to keep the people that matter.
Yes, 1000%. Especially when it comes to AI. Meta has an excellent team of ML engineers, many of whom are in exceptionally high demand right now. If I were a ML engineer at Facebook, _especially_ if I was working remotely, I'd be sending out a ton of applications right now. I bet they end up getting an easier, more meaningful, higher paying job.
I'm an AI research engineer who was recently laid off and this was my experience.
It's hard to see how anyone has thought FB/Meta would be a great place to work for a long time.
They have been involved in so many shady things and have had such a "throw everything at the wall and see what sticks" approach it sounds maddening.
I think a lot of people working there just made the calculated decision that Meta being at the very high end of the compensation scale made it worth it.
Even if you are in the ML/AI stuff. You have to balance out that they were funding at a very high rate versus that they were funding the work for less than stellar reasons.
So exactly where are you going to find this “less volatile environment”? Other BigTech companies that are also doing layoffs? Unprofitable startups or other money losing recently public companies?
Are they going to sully themselves and work as “enterprise developers” (note sarcasm)?
A players always in demand, no matter whatever the economic situation. They have the freedom to choose wherever they want to work.
I'm not sure how many A players have left meta, but I'm sure A players never want to work in a low morale company. The damage is much higher than layoff number.
> I wonder if sending this message out like this is a huge gamble on Meta’s part.
I'm Danish, but we have laws and regulations about mass-layoffs which means companies have to give employees an advance notice of 30-60-90 days, depending on company and layoff size.
I imagine California might have something similar.
There has to be plenty of demand at the lower tiers. There is a ton of work to do everywhere. It's just that they don't pay the same as top tier. FANGs are holding a lot of talent to keep them from competitors, as has been pointed out.
Every time there is a layoff announcement, I feel like half the comments are nitpicking over the language. It was too long, it was too short, language was too conciliatory, not conciliatory enough, yada yada. We get it. Managers are people too, they're not perfect. At this point, as an employee, I'd just ignore everything that was said (I know it's probably been wordsmithed to death anyway trying to find the right balance for all the various stakeholders), and only focus on the actions: are people treated fairly and with respect, both for those leaving and those remaining.
Layoffs are not something any employees can control. It's gonna happen or it's not. That's it. Without proper collective power, the only thing we can do is worry.
You're right in that language doesn't matter. Hell even the delivery of the message doesn't matter. The only thing that matters is the severance or layoff package. That's the real meat. There should be a mandatory law that publishes all layoff packages so that everyone can see if they're getting a fair deal or not.
“The medium is the message.” Yes, the nitpicking over language is silly. In some cases, actually sort of pathetic.
It is true that these messages can be overwrought and whatever else, but it literally doesn’t matter what the content is besides the fact that a layoff is happening. If you tell me I’m laid off with a smile or with a middle finger makes no difference, I’m still laid off.
Every time a layoff is discussed, people talk about how the A players are going to leave. Seemingly, people do not understand that the A players could have easily left the whole time but are taken care of - already - so they haven’t.
It is not that rare for critical employees to get grants as part of the layoff execution in a pre-emotive action, and now that I’m older I will note that I’ve been on the planning side of layoffs and this is fairly commonplace.
+1, there are some quite juvenile sentiments about employment evident in this thread. If a company wants someone to stay they'll try very hard to make that happen. Not every employee is treated equally.
Not sure if it's true in Meta's case (and almost certainly not Twitter's), but from what I've heard, they usually tell the key people that they are safe a day before.
> This will be great for morale and will likely only cause your A players (who are probably still very much in demand) to look elsewhere.
I imagine the vast majority of their ultra top-tier talent has left already unless Meta gave them gigantic bonuses.
The stock is down ~40% from where a lot of their RSUs were granted - more than 50% of their pay comes from those grants.
They've had a year of time to go somewhere else and make way more money - most of them probably took that unless Meta gave them a gigantic bonus to keep them whole.
>They've had a year of time to go somewhere else and make way more money - most of them probably took that unless Meta gave them a gigantic bonus to keep them whole.
But other FAANGS are not hiring. So where it's somewhere unless they planned to start their own businesses?
This is a huge factor! In my experience having a whole bunch of stock can be a really powerful anchor to keep you in place at your job even if you're not 100% happy.
> cause your A players (who are probably still very much in demand) to look elsewhere.
Vast majority won't find jobs that are as well paying as facebook. FB is a leader in tech salaries which gives them the leverage to announce such a thing without losing people. People don't want to take paycuts and go somewhere thats also doing layoffs.
It is a good point. But people still can be "looking elsewhere" as in searching if they can find another job. It is exactly the thing I would do if I had any chance that I would loose my job. I know my manager would never do it but with layoffs there are greater forces that he may not be able to save me from.
And changing your availability and answering a call or chat from time to time does not cost much. It is not like there is any downside to it.
And if an A player starts looking around great things sometimes happen. He may get hired at much higher position that would justify the salary. Or he may have already earned a lot at FB and may decide this is the time to invest in building a startup, etc.
At my previous company I got in an argument with my boss and just changed my availability on LI. Just out of spite. This led me to an offer that changed my life. And there is a lot of people so much better at their job than I am.
> writing an email about how you're going to can a bunch of people over the coming year and then droning on about how the results of that are going to be so much better (and insinuate that the current setup, which is 100% a management failure, was a poor setup) is insulting.
Employees ask for transparency. This is what transparency looks like...
For once, as someone with 0 stake in this whole affair, I quite like he's explicitly spelt out the details he has.
Specifically the sections "Leaner is better", and "Flatter is faster". Other sections are quite relevant and well written IMO.
Also, reading between the lines, Metaverse gets mentioned just twice. I guess they are going to go slow on that? And Oh, "In-person time helps build relationships and get more done" tells me WFH at Meta will be a thing of the past.
Honest question, but are they? And, just as important, is anyone other than a FAANG company willing to pay them the same high comps right at this moment?
I can see a high-need-for-people/high-comp scenario still possible in some parts of finance, but with these recent events I'm not so sure anymore. I'm also sure that right now there's a high demand for people in anything related to MIC/the war industry, but I don't think they can provide the same high comps as FAANGs do, unless one choose to go the contractor route (which also comes with its pluses and minuses).
> and will likely only cause your A players (who are probably still very much in demand) to look elsewhere
I really don't believe that it's a given that Meta still needs them: the entire org was designed for "innovation", and that has certainly been the right call back in the day. E.g. back when they were still on the edge between buying and competing with whatsapp and instagramm on the product level.
But Meta products have been beyond "salvation by innovation" for almost a decade now, what they need to maximize shareholder value is the cheapest setup to keep value extraction up and running for as long as the brands still do their thing. The innovation game is over for them, because the same brand effect that saves the platforms from dying immediately also taints anything Meta buys or starts. Even if Meta had a "Toktik" that had feature equivalency with Tiktok without even a microsecond latency, it would still be stillborn because people just don't want yet another Meta product in their lives (even to the point where they'd rather have a CCP product in their lives, brand awareness isn't exactly a field where logic applies).
These days Meta is in the position comparable to that of a single-field oil extraction company that has no hope for getting claims on any other fields and that has its existing field already fully prospected and tapped. That field is far from empty yet, but they only need people to keep the pumps running, no prospectors, no drillers, no acquisition strategists. Those Meta employees that have been traditionally considered "A players" they wouldn't want to lose and that might actually have been paid absurd sums only to keep them from innovating for the competition are all in the "prospectors, drillers, strategists" group and those have exactly zero value for the janitorial task of keeping the pumps running (edit: more likely negative value, not zero).
(I know, this almost sounds as if I was saying that Musk's Twitter strategy of burning down the house and then trying to macguyver something useful from the rubble was smart, I'm a bit surprised myself. I guess I do think that the aggressive downsizing would have been the rational thing for Twitter to do, but certainly not as a "step 2" after "step 1: throw 44 billion at previous owners". In hindsight, waiting for 44 billion to show up has certainly been much better for previous Twitter owners than doing the downsizing themselves)
Why is the immediate response to criticize? Every single time I've seen layoffs discussed people always ask why it can't feel like more of a conversation and less like a bandaid getting ripped off (because it sucks to be part of the bandaid). Employees want to be included in the conversation. It seems that's exactly what is being done here. How is that insulting?!
I mean we also hear the traditional rationale for why you can't announce layoffs in advance but it doesn't seem absurd to try it since there seems to be remarkably little data on the subject. Further, if you're considering letting 10k people go, I don't see how it's bad to have the loose ones leave of their own volition. I actually liked the tone and detail of this post. It certainly seems Meta is preparing to fix more than "100% a management failure"...
Conversely, if you're an A player you may be ecstatic in believing the company is finally getting back on track, and therefore want to stay.
Something similar happened when Steve Jobs returned to Apple. He cancelled ~70% of the product roadmap and the engineers were thrilled that the company finally returned to a coherent vision.
> Also, this is a 2nd round barely 6 months after the first and it's going to happen over months. This will be great for morale and will likely only cause your A players (who are probably still very much in demand) to look elsewhere.
Part of the plan is that lots of people leave on their own along with the 10k. For me, the real question is, how many of the A players can afford to leave? Salaries have to be declining many of the top payers have hiring freezes. It seems like even though they're in high demand will they be able to demand the same pay? And if they can't how many are willing to take the jump and leave for less money? They're called golden handcuffs for a reason.
From what I've heard attrition is very low right now. Which makes sense... why leave when you might get paid four months of salary if you are laid off instead.
Exactly. My first thought was how dystopian it is to start an email about layoffs during the "year of efficiency" with how your company is "building the future of human connection".
I agree that the press release is way too long. I'd add one more specific recommendation for anyone who ends up in a leadership role:
If you're ever in a situation where you need to lay off or otherwise end your relationship with employees, contractors, etc., avoid using terms like "garbage collect[ion]" in the press release, even if you think it's in a section that's not directly about the people you're letting go.
> Also, this is a 2nd round barely 6 months after the first and it's going to happen over months. This will be great for morale and will likely only cause your A players (who are probably still very much in demand) to look elsewhere.
That may be the plan. There are two benefits of this: more than 10000 people leave your company, but you don’t have to pay severance to them. And second, A players are compensated well and a layoff forces you to pay them hefty severances. If you think your A players do not contribute as much as they are getting paid, this is a way to push them out without paying that extra cash.
The fault of this lies in upper management. They're getting paid a lot of money to foresee these sorts of things and to plan for them. Hiring like crazy isn't planning, its just doing bare minimum to make it look like you're doing something. But this is also endemic to the Meta org: you can only rise up if you hire enough people below you. And the fault for that ridiculous requirement lies in Zuckerberg. Why are none of the upper management accepting that THEY failed? They should be laid off along with the workers. Including Zuckerberg.
This isn't just an internal email, it's a press release. Everyone knows that if it was just an internal email someone would leak it, so they are writing it knowing that the public will see it.
I'm sure Zuck really appreciates the advice of a random HN commenter. It's not like he has experience running one of the world's largest companies or anything.
> will likely only cause your A players (who are probably still very much in demand) to look elsewhere.
As other have said: is there such a high demand right now ? And if you know and feel that you are an "A" player; and so far you have seen "C" players getting laid off, you might actually feel that the average level of the people you interact with increases which makes you want to stay more.
In most big companies I've worked at, I thought I could identify the people who made everyone slower and were a net negative to productivity. However, they never seemed to be the ones threatened to be fired. Often they were really good at playing corporate games so that it was really hard to justify firing them, while the ones fired were junior employees who had great potential but weren't as good at politics yet.
So while FB certainly intended to fire underperformers and increase average performance, I doubt they were able to identify the right people for that.
Managers write novels because employees complain about lack of transparency and communication. I promise you no manager wants to write some novel about how layoffs are good for company, but they just or they get skewered for not communicating.
Saying more words isn’t communicating. In this situation, employees would like to be able to prepare for the layoffs ahead of time, know their jobs are safe (or not), and see what they can change. Saying a bunch of stuff about the future outlook of the company being bright feels like a lie when that’s the same email that got sent after the last round, three months ago
Never fun for those impacted, but given Meta’s poor performance this is expected. The history book is being written now on if Meta was a brilliant business for the ages or always destined to decline into a has-been tech play. Ironically now Zuckerberg is the old guard with stale ideas that he railed against so hard when Facebook was founded. My grandparents and their friends are currently the most active users on my Facebook feed. Most under 40 in my circle have left and most under 25 I know don’t even have an account.
If Facebook can turn things around then that would be truly impressive. Right now it’s on a slow march to the sidelines of has-been tech. I don’t think anyone is buying the whole metaverse thing, which just smells like someone missed the memo on Second Life. Facebook bet the farm there and the crops and livestock are looking rather ill.
Poor performance? Meta is doing great and just had one year of not insane growth. My take on why they have to fire people is that they hired way too many in 2020 and 2021.
Tech companies are valued by how they dominate particular sectors/niches and the potential growth of that sector/niche.
Facebook doesn't dominate social any more like it once did. It did so with Facebook itself then with instagram but TikTok is grabbing the current generation of new users.
It can't grow like it once did and usage of its existing services will gradually decline.
It's betting that the metaverse is the next social medium after TikTok's short form video. Personally I doubt that but that's the bet they're making.
IMHO these hirings and firings are not about the present but about the future. Sure, Meta did great but Nokia also did great for a while after iPhone was introduced.
What is the latest cool Meta product which promises a bright future for the company? Well, llama is cool but it's not product and today's greatest social media sensation is TikTok.
I'm sure meta does have some great tech, in fact some of the work they did on VR with all these tens of billions of dollars is groundbreaking but that also failed as a product.
Why would they keep the workforce configuration the same if their current state is probably not what they want to be tomorrow?
Facebook’s ads business has been destroyed by Apple with the introduction of ATT. It’s pretty clear this is a permanent shift downward in revenue for them, unless advertisers like them are able to improve ads attribution.
> Meta is doing great and just had one year of not insane growth.
This completely overlooks the changes that happened in that one year of not insane growth.
Apple cut Meta's legs off and Meta has no indication on how they're going to regrow them. The Metaverse is flopping, FB is seen as a place for hate, youths don't have accounts, etc, etc, etc.
Facebook is not the future of social media and Meta has not come up with a viable alternative.
Poor performance is relative to what their peers (Alphabet/Apple/Amazon/Microsoft) were accomplishing for many years in the 2010s.
The market has separated these 5 pretty clearly now, with Meta trailing by quite a bit, Alphabet and Amazon in the middle, and Microsoft and Apple with a decent lead.
>Poor performance? Meta is doing great and just had one year of not insane growth.
Public sentiment is terrible and if that's a reliable leading indicator, the company will be in trouble if it doesnt continually diversify into products that distance themselves from the core brand.
There are very very few fresh ideas and even those require the vast majority of the project built on someone else's work. Taking something existing and doing it better is what business is all about.
This is true of every tech billionaire. They improved something that already existed.
Rarely if ever do they true novel inventors dominate the market because when the market doesn’t exist they have to create it, and also they’re inventors not necessarily business men.
It's a little frustrating that they don't seem to break down earnings for Instagram and WhatsApp. My impression is that their monetization of Instagram is probably ok but not great compared to Facebook and their monetization of WhatsApp is probably awful.
I know people like to shit on the blue app, but Instagram has done a very good job at attracting younger users and feels like fb’s main focus anyway.
Ironically apple entering AR/VR may be the best thing to happen to Meta if it helps bolster the ecosystem. Meta may not be #1 in the space for a long time, if ever, but they may be able to ride the wave to a strong #2
Soon you'll all be fighting for your jobs. Many of you will be dying for your jobs. A few of you will be forced through a fine mesh screen for your jobs. They will be the luckiest of all.
-- Zuck probably.
I feel like 10K people are taking a hit because Zuck ruined VR for another decade with his very boomer like imagination and monetization strategy.
We didn't have good notion of global social network at the time - facebook was first, kinda, so they took it all. Facebook still gonna prevail, but over time it festered a lot of specialized competition from twitter, reddit, linkedin, discord.
> Don't they have an enormous cash pile? How does that translate to poor performance?
When you run a business, you look towards the future and what profit you're forecasting. You don't want to see decline in profits, you don't want to use your cash reserves to compensate for less profit.
Facebook reported $23.1 billion net profit in 2022, a decline on the $39.3 billion made in 2021.
Well they have some money in the bank, but culturally nobody thinks meta is the future (within USA at least). There is massive mistrust of their brand and any product they could ever make (be it lack of privacy or giving a terrible experience by over-monitizing).
I know that working in tech can warp your sense of reality, but it's really, really hard to imagine starting an email in which I announce that I'm laying off 10,000 people -- the entire population of my hometown and then some -- with "Meta is building the future of human connection."
I just can't tell a story in which I would end up being a person who does that. It's too alien.
Despite the claimed intended audience, that letter isn't written for employees. It is written for shareholders. And judging by the stock price, it had the intended effect.
My one hope in all this is that some tech workers who drank a lot of corporate kool-aid over the years, i.e. the “we’re a family” managerial nonsense, will finally see the reality of the industry we work in and the real aim of quarterly capitalism which is profit and growth at all costs every single quarter. Your well being, since you likely attach it to work, is not part of that formula. You are expendable and will be sacrificed on the altar of profit at a moments notice.
> Our early analysis of performance data suggests that engineers who either joined Meta in-person and then transferred to remote or remained in-person performed better on average than people who joined remotely. This analysis also shows that engineers earlier in their career perform better on average when they work in-person with teammates at least three days a week. This requires further study, but our hypothesis is that it is still easier to build trust in person and that those relationships help us work more effectively.
> This requires further study, but our hypothesis is that it is still easier to build trust in person
I chuckled a bit. This is coming from a Social Media Company whose product is about connecting online. What does it say about the trust between users of its platforms?
Well I mean, the simple explanation is online is still far better than nothing. I'm not sure anyone is expecting you to read someone's wall if you could just talk to them every day.
Juniors and interns really strugle in a remote environment.
Since Meta was hiring mostly new grads or junior leetcoders it makes sense that remote work culture at Meta hit some bumps.
> Juniors and interns really strugle in a remote environment.
Blanket statements like this are trying to make a multifaceted problem into a single problem. I don't understand why we are always so quick to say underperforming remote junior engineers are underperforming because of remote work. Maybe the problem was Meta went half in on supporting remote as an onboarding ramp and teams did not put the work in to make sure Juniors thrived in a remote environment.
Speaking from experience, If you are truly trying to be a remote company, you adjust as needed to support new employees, junior or not.
You cannot blame company policies for the poor performance or low motivation of individual junior developers. My team has hired multiple junior developers in the last 2 years, all of whom are 100% remote, and they've been doing excellent.
To me this sounds more like – engineers who have been at Meta < 3 years (so were hired remote) are performing worse than those who have worked there longer. Which...doesn't sound that crazy and doesn't have to be related to remote vs in-person at all. Of course your tenured employees are better at their jobs.
This was the most obtuse portion of the entire diatribe, and further cements my rather low opinion of Meta leadership; they have all the data in the world, but have no idea how to make proper conclusions from it.
Anecdotally... GOOG/Meta haven't updated their interview process significantly and it now just screens for quantity of leetcode grinded. This is likely a poor signal for actual engineering competence.
I wonder how that analysis takes into account the general craziness and stressfulness of the pandemic, which was the cause of many employees joining Meta remotely? Not to mention, Meta did a crazy total amount of hiring during the pandemic, ramped up very quickly, which by itself can lead to inefficiency.
The irony is they’re tip-toeing around this but it’s been known remote workers don’t perform as well for as long as I’ve been in the industry. There’s a reason CEO’s will often come in touting how they’re going to promote wfh and then back off once they see the performance metrics their policy creates
> it’s been known remote workers don’t perform as well for as long as I’ve been in the industry.
It most certainly is not "known". I've managed remote teams, I've managed in-office teams and I've managed the same people in both scenarios. At no time was the office advantageous to innovation. Quite the opposite, it's a soul suck and once you free people to work how they are comfortable, their creativity will skyrocket.
I'm 2 decades into this career with the last 10 being remote, and I am as productive as I was in the office.
It certainly takes discipline but I treat working from home the same as if I was in an office.
I am at my desk during business hours. People can Slack me, email me, call me on Teams, whatever. Besides, everything is logged. Every line of code, pull request, login time, email sent, all of it. They know what I'm up to.
It does not surprise me at all that performance ratings are correlated with office presence, but not for the reasons they imply. The performance evaluation system at Meta is heavily biased towards political visibility and grandstanding and these are simply much easier to achieve in a physical workplace.
I wonder if the eventual result of all this work from home debate will be that it's something that's earned after a period of time. e.g. 1 day a week after 6 months of employment, 2 from 1 year, etc.
That actually makes perfect sense to me from a practical perspective.
It doesn't make sense because the biggest advantage to WFH is that people can live in a lower cost of living city (and companies can hire the best talent globally). Forcing people into the office even once a month means you're tied to the real estate market next to the office.
> our hypothesis is that it is still easier to build trust in person
Nothing builds trust like callously laying off tens of thousands of people over multiple rounds of layoffs! Want a trustworthy environment? Earn it. Really though when he says "build trust" what he means is that he (Zuck) does not trust his employees unless he can see them.
Meta is undergoing a standard phase transition. It was innovation fuelled previously, but now it is value fuelled (milk the existing machine, take care of regulators, be part of the establishment). Intel and IBM are similar examples.
So Zuckerberg, to prevent this, has the right strategy - the pirates inside the organisation strategy. Jobs did this with the Mac project. The question mark really is whether the Metaverse can deliver to take over from the Social Media platforms it has. Even if you accept the promise of Metaverse, according to Carmack the execution has been poor. Normally you just buy your way out with promising startups when execution is poor but the regulators will be heavy with Meta nowadays.
Meta has star power with AI/ML. But on Metaverse there isn't much consumer data to process (yet). So its innovation vector can't be realised.
This effectively means the stars of AI/ML won't help Meta into the future. If they leave, it could be a good thing (if we are taking the value-fuelled hypothesis as their future).
Meta I think will switch to a MBA-led approach to maximise existing value, shed its research aspirations, and switch to hiring the best mechanical/devices/hardware talent it can to improve execution on Metaverse.
Under this appraisal of Meta, broad and wide layoffs, letting the superstars go is the right thing for the company. Unlocked from Meta, those engineers will forge the next great wave of tech companies. The future will be made over the next few months as those start-up fevered ideas will actually get a footing. So I am most hopeful despite the bitter pill of current economic realities. In the short term there is real pain, particularly those relying on visas or the generous healthcare provisions from the company.
Exactly. There is no nice or correct way to do this. Lots of companies seem to go through this and come out fine on the other end as well.
I worked at Nokia through their transition from being the largest smart phone manufacturer in the world to shortly before they sold off what remained of their phone unit to MS, who shut it down completely less than two years later. Basically, that probably affected many tens of thousands of people. I heard all the cliches and was on the receiving end of them. Two points here: 1) this is not personal even if it deeply effects you. 2) if you are not part of the solution, you are part of the problem. The last point here doesn't mean you are the problem, or the cause of the problem. But simply that your presence is no longer part of any solution to whatever the problem is. Whether you agree with that or not is beside the point. The fact is that, once companies get to this stage, there is only one way forward: let go of a lot of people.
IMHO, Facebook is being to cautious here. They need to cut much more deeply than this and re-focus on their core products and modernize those. Facebook has been dead in the water for years. Whatsapp has an aging user group as well. Instagram seems past its glory. Messenger seems like a failed product at this point. Time to take it out the back and kill that. Revitalizing Facebook and Instagram will require some drastic changes. It's not going to magically start turning around without that. It's either continued gradual decline or finding some way to become relevant again.
I don't disagree with anything you've said here, but I can't help but feel this reads like a monologue from a supervillain who feels righteous in burning the world down because they believe something greater will rise from the ashes.
> The future will be made over the next few months as those start-up fevered ideas will actually get a footing.
The trouble here though, is very few VC's have an appetite to fund now, especially seed / series A. They are too busy dealing with the overpriced and soon to fail cohort from 2020/2021
I spoke with a VC just last week from one if the top five, they are yet to fund anyone new this year.
>Normally you just buy your way out with promising startups when execution is poor
So here's the thing. Who is doing better at this than Meta? Who could they buy? Regulation is a secondary issue.
At this point, the Quests are pretty good gaming machines. Its the software that's lacking. MMAAAN has traditionally struggled with content creation. It took a long time for the streaming studios to get any decent shows. Apple, Google, Netflix and Amazon don't really have a good game portfolio to this day.
They could possibly buy or spin up a bunch of game studios to crank out content but on the hardware side I think they actually are best in class here.
Does AI/ML not unlock value for the Metaverse? Also, the layoffs are set to prioritize recruiting, management, and business personnel. That seems to go against the idea that they are switching to an MBA-led approach.
"In 2020, Meta added over 13,000 employees, a 30% increase, and the biggest year of hiring in the company’s history. In 2021, it added another 13,000 workers. By total worker numbers, it was the two biggest years of expansion in Facebook’s short history."
It is quite possible that the people they are firing aren't the ones they recently hired, but instead people who have been there for a long time but aren't meaningfully contributing anymore.
Many managers get promotions for how much the people under them accomplish. There is some adjustment to headcount, but the more you can get hired under you, the higher you can get promoted.
As impressive as that sounds, Iceland has less than 400k people, it's about the same size as Cluj, a city in Romania probably 0.1% of HN ever heard about :-)
I personally think this "we hired too many people" excuse doesn't hold water. This reminds me of the dot-com bubble where they jacked up interest rates and it caused companies to do layoffs.
Back then interest rates were low and money was cheap. It was growth over profit and when money is cheap you can afford to run in the red as long as you're getting bigger. The minute interest rates went up companies had to rethink how they're going to spend money. We haven't seen the type of corp consolidation yet that we saw back then but it's still early days.
The word "efficiency" appears 20 times in this article. Yet not once does the author explain where all of the inefficiency - the layers, the fat, and the lethargy - came from. Nor does he explain the logic of culling employees now.
These are not the words of someone who has learned lessons or who is interested in telling the truth.
So here's a hypothesis: Facebook is not a "technology company," it's an advertising company. And spending on advertising has cratered as businesses everywhere have pulled in their horns in response to their own falling revenues. Facebook lived large during the fake boom. It hired way too many people and a built a bloated, middle-heavy organization that is poorly-suited to the task ahead: taking back territory it's lost to smaller, nimbler competitors. Facebook management bought the economic lies being told hook, line, and sinker.
The party's now over and Facebook faces major headwinds, including savage competition, declining revenue, and the aftermath of a hiring orgy gone wrong.
Some part of it was highlighted with the mention of an org chart that is both deep and sparse. Many managers had only 2-4 reports with the expectation that the org chart would fill out with hiring. Now that hiring has slowed dramatically, those levels won't fill out, so consolidation makes sense.
There was also a lot of duplicative and overlapping work, which is mentioned as well.
To paraphrase Steve Ballmer: "investors, investors investors".
The 'efficiency' here is slashing operational expenses to boost earnings per share. That is a temporary boost, but one that can be repeated a few times.
Ignore the fluff piece. The reality is you're being laid off because the company can make more money by taking your salary and buying government bonds.
When your team got spun up to work on this project, interest rates were low and it was a sound investment to try this project out. If it was successful, it might have made/saved a moderate amount of money. It made sense to invest in it, compared to all the other options available at the time.
But alas, inflation soared and interest rates rose faster than predicted, so now the bonds are a better bet than you and your team doing whatever it was you were doing. According to this spreadsheet, it wasn't nearly as profitable as the bonds.
Government bonds yield 3-4%. I don't think they ever calculated with a margin of just 4%. It's true that liquidity has dried up to some degree and companies have alternatives what to do with their money, but it's not like they though they'd yield only 3% by hiring more people.
I think this is really good intuition on what the Fed effectively does. When it's really easy to teleport money from the future, all that money competes in the present for a limited supply of good. This causes inflation and reduces margins and can cause profitable endeavors to become non-profitable "hobbies."*
Increased interest rates suck up this money because now there is something better to do with that money. Why "Do Stuff" when the returns on doing stuff is less than the ultra high savings yield you are now being offered.
It's virtuous when the stuff being done actually is destructive due to easy access to capital (e.g. 100 Ramen shops driving each other into further and further debt) but it's also a ham-fisted solution. It disrupts long term planning, even relatively conservative ones like "buy government bonds", and also just punts the problem b/c it's reducing demand by... promising more money in the future.
I believe that is the point the OP was making. If you're ROI on employee X is 3% of the investors' dollar, the investor would simply buy a bond since the ROI on the bond is higher. Because of this discrepancy it no longer makes sense to keep employees or business units with a 3% ROI or an ROI lower than what the expected return on a bond is.
Readit News
You don't need to write a novel with these. Also, writing an email about how you're going to can a bunch of people over the coming year and then droning on about how the results of that are going to be so much better (and insinuate that the current setup, which is 100% a management failure, was a poor setup) is insulting.
Also, this is a 2nd round barely 6 months after the first and it's going to happen over months. This will be great for morale and will likely only cause your A players (who are probably still very much in demand) to look elsewhere.
I was so happy when that company got acquired and the new company CEO showed up and announced that first level managers and below were all safe from layoffs, everyone above that was on a case by case basis, and "all executive staff were let go this morning, I saw no reason to keep those jokers around".
He was so right. Scored a lot of points there, never heard an executive of a large company say that so bluntly before.
I have been told that one FANG which recently underwent a firing round barely took a break from their hiring rounds, and already started sending emails asking for volunteers for interviews even to teams which have just been decimated.
One more story for the absurdity bucket.
Needless to say that didn't go over well.
A year later they were all gone. And him as well.
¯\_(ツ)_/¯
If the emails are succinctly composed then people would complain that the announcements were too curt and don't try to assuage people enough.
So they might as well write what they want.
Didn't the executives employ any anti-takeover measures?
Or you can do the opposite, like Boeing did: import all the managers of the firm you acquired (McDonnell-Douglas) into your own organization.
New CEO was Australian?
You are being manipulated. No. The previous executives are not "jokers" - they made massive profits selling shares. They are being let go because, after taking their massive profits, the new company will soon fire the rest of staff - and that is hard.
If I were there I’d be seriously considering a less volatile environment. If I were an A player, I’d be able to do so even easier and potentially find more meaningful work. This seems like a bad move for Meta, just leaving the axe up in the air ready to strike like this.
With numbers in the thousands, it gives me the sense that it might not always matter what you do or how good you are.
That may be intentional. I could see a scenario where voluntary attrition helps them get reduce size more organically and with lower cost than a layoff. Meta is still huge and pays good money. They can handle a huge level of attrition and still have enough "A players" left over to work on the thing that truly require that level of operation.
> With numbers in the thousands, it gives me the sense that it might not always matter what you do or how good you are.
Fully agree on this. At that scope, it's broad cuts with a lot of meat going with the fat.
What is AE? Meta has a program for their top ~1% or so (who knows really) where they dump a pile of RSUs on your head, "additional equity", to retain you and bet on your future at the company. For most it's 2-4x your annual stock refresher, though I don't know exactly how it varies.
If you're E7+, this is another 1M+ stock grant on a 4 year vest on top of your 600k+ refresher grant. Stock is up from their internal refresher pricing. Their "A players" all just got ~5% bump on their 1.5M+ RSU grant.
G and other FAANG struggle to compete with Meta on comp for the actual A players. We'll see if they budgeted enough for AE to keep the people that matter.
I'm an AI research engineer who was recently laid off and this was my experience.
They have been involved in so many shady things and have had such a "throw everything at the wall and see what sticks" approach it sounds maddening.
I think a lot of people working there just made the calculated decision that Meta being at the very high end of the compensation scale made it worth it.
Even if you are in the ML/AI stuff. You have to balance out that they were funding at a very high rate versus that they were funding the work for less than stellar reasons.
Are they going to sully themselves and work as “enterprise developers” (note sarcasm)?
I'm not sure how many A players have left meta, but I'm sure A players never want to work in a low morale company. The damage is much higher than layoff number.
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I'm Danish, but we have laws and regulations about mass-layoffs which means companies have to give employees an advance notice of 30-60-90 days, depending on company and layoff size.
I imagine California might have something similar.
I don't know how to break this to HN, but the Zuck isn't the sharpest tool in the shed. He may be gambling, but Hanlon's Razor says otherwise.
https://en.wikipedia.org/wiki/Hanlon%27s_razor
You're right in that language doesn't matter. Hell even the delivery of the message doesn't matter. The only thing that matters is the severance or layoff package. That's the real meat. There should be a mandatory law that publishes all layoff packages so that everyone can see if they're getting a fair deal or not.
It is true that these messages can be overwrought and whatever else, but it literally doesn’t matter what the content is besides the fact that a layoff is happening. If you tell me I’m laid off with a smile or with a middle finger makes no difference, I’m still laid off.
It is not that rare for critical employees to get grants as part of the layoff execution in a pre-emotive action, and now that I’m older I will note that I’ve been on the planning side of layoffs and this is fairly commonplace.
I imagine the vast majority of their ultra top-tier talent has left already unless Meta gave them gigantic bonuses.
The stock is down ~40% from where a lot of their RSUs were granted - more than 50% of their pay comes from those grants.
They've had a year of time to go somewhere else and make way more money - most of them probably took that unless Meta gave them a gigantic bonus to keep them whole.
But other FAANGS are not hiring. So where it's somewhere unless they planned to start their own businesses?
If the stock tanks that vaporizes really quickly.
Letter 1: Blame previous management.
Letter 2: Announce a reorg/layoffs.
Letter 3: Tell your successor to write three letters...
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Vast majority won't find jobs that are as well paying as facebook. FB is a leader in tech salaries which gives them the leverage to announce such a thing without losing people. People don't want to take paycuts and go somewhere thats also doing layoffs.
And changing your availability and answering a call or chat from time to time does not cost much. It is not like there is any downside to it.
And if an A player starts looking around great things sometimes happen. He may get hired at much higher position that would justify the salary. Or he may have already earned a lot at FB and may decide this is the time to invest in building a startup, etc.
At my previous company I got in an argument with my boss and just changed my availability on LI. Just out of spite. This led me to an offer that changed my life. And there is a lot of people so much better at their job than I am.
If you joined from 9/2020 to 1/2022, you’ve taken a serious pay cut versus your nominal offer.
Unless there have been adjustments that I haven’t read about?
Employees ask for transparency. This is what transparency looks like...
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Specifically the sections "Leaner is better", and "Flatter is faster". Other sections are quite relevant and well written IMO.
Also, reading between the lines, Metaverse gets mentioned just twice. I guess they are going to go slow on that? And Oh, "In-person time helps build relationships and get more done" tells me WFH at Meta will be a thing of the past.
Edit: More content.
Honest question, but are they? And, just as important, is anyone other than a FAANG company willing to pay them the same high comps right at this moment?
I can see a high-need-for-people/high-comp scenario still possible in some parts of finance, but with these recent events I'm not so sure anymore. I'm also sure that right now there's a high demand for people in anything related to MIC/the war industry, but I don't think they can provide the same high comps as FAANGs do, unless one choose to go the contractor route (which also comes with its pluses and minuses).
I really don't believe that it's a given that Meta still needs them: the entire org was designed for "innovation", and that has certainly been the right call back in the day. E.g. back when they were still on the edge between buying and competing with whatsapp and instagramm on the product level.
But Meta products have been beyond "salvation by innovation" for almost a decade now, what they need to maximize shareholder value is the cheapest setup to keep value extraction up and running for as long as the brands still do their thing. The innovation game is over for them, because the same brand effect that saves the platforms from dying immediately also taints anything Meta buys or starts. Even if Meta had a "Toktik" that had feature equivalency with Tiktok without even a microsecond latency, it would still be stillborn because people just don't want yet another Meta product in their lives (even to the point where they'd rather have a CCP product in their lives, brand awareness isn't exactly a field where logic applies).
These days Meta is in the position comparable to that of a single-field oil extraction company that has no hope for getting claims on any other fields and that has its existing field already fully prospected and tapped. That field is far from empty yet, but they only need people to keep the pumps running, no prospectors, no drillers, no acquisition strategists. Those Meta employees that have been traditionally considered "A players" they wouldn't want to lose and that might actually have been paid absurd sums only to keep them from innovating for the competition are all in the "prospectors, drillers, strategists" group and those have exactly zero value for the janitorial task of keeping the pumps running (edit: more likely negative value, not zero).
(I know, this almost sounds as if I was saying that Musk's Twitter strategy of burning down the house and then trying to macguyver something useful from the rubble was smart, I'm a bit surprised myself. I guess I do think that the aggressive downsizing would have been the rational thing for Twitter to do, but certainly not as a "step 2" after "step 1: throw 44 billion at previous owners". In hindsight, waiting for 44 billion to show up has certainly been much better for previous Twitter owners than doing the downsizing themselves)
I mean we also hear the traditional rationale for why you can't announce layoffs in advance but it doesn't seem absurd to try it since there seems to be remarkably little data on the subject. Further, if you're considering letting 10k people go, I don't see how it's bad to have the loose ones leave of their own volition. I actually liked the tone and detail of this post. It certainly seems Meta is preparing to fix more than "100% a management failure"...
Something similar happened when Steve Jobs returned to Apple. He cancelled ~70% of the product roadmap and the engineers were thrilled that the company finally returned to a coherent vision.
The market isn't good right now. Not many places that are hiring can give an offer that matches a FAANG
HN seems to think it is the birthright of a good dev to get a $450k salary...just "because"
look at it from the other side of the table...you have 300 great resumes for a position...why do you have to offer a premium salary?
counterpoint: these salaries were a blip and will never return in nominal form (let alone inflation adjusted) for many devs ever again
Part of the plan is that lots of people leave on their own along with the 10k. For me, the real question is, how many of the A players can afford to leave? Salaries have to be declining many of the top payers have hiring freezes. It seems like even though they're in high demand will they be able to demand the same pay? And if they can't how many are willing to take the jump and leave for less money? They're called golden handcuffs for a reason.
If you're ever in a situation where you need to lay off or otherwise end your relationship with employees, contractors, etc., avoid using terms like "garbage collect[ion]" in the press release, even if you think it's in a section that's not directly about the people you're letting go.
That may be the plan. There are two benefits of this: more than 10000 people leave your company, but you don’t have to pay severance to them. And second, A players are compensated well and a layoff forces you to pay them hefty severances. If you think your A players do not contribute as much as they are getting paid, this is a way to push them out without paying that extra cash.
* People who have built companies from 0 to $Trillion (making a lot of employees incredibly wealthy)
* ^^ People who give free advice on the internet ^^
As other have said: is there such a high demand right now ? And if you know and feel that you are an "A" player; and so far you have seen "C" players getting laid off, you might actually feel that the average level of the people you interact with increases which makes you want to stay more.
So while FB certainly intended to fire underperformers and increase average performance, I doubt they were able to identify the right people for that.
If Facebook can turn things around then that would be truly impressive. Right now it’s on a slow march to the sidelines of has-been tech. I don’t think anyone is buying the whole metaverse thing, which just smells like someone missed the memo on Second Life. Facebook bet the farm there and the crops and livestock are looking rather ill.
https://www.statista.com/statistics/277229/facebooks-annual-...
Facebook doesn't dominate social any more like it once did. It did so with Facebook itself then with instagram but TikTok is grabbing the current generation of new users.
It can't grow like it once did and usage of its existing services will gradually decline.
It's betting that the metaverse is the next social medium after TikTok's short form video. Personally I doubt that but that's the bet they're making.
What is the latest cool Meta product which promises a bright future for the company? Well, llama is cool but it's not product and today's greatest social media sensation is TikTok.
I'm sure meta does have some great tech, in fact some of the work they did on VR with all these tens of billions of dollars is groundbreaking but that also failed as a product.
Why would they keep the workforce configuration the same if their current state is probably not what they want to be tomorrow?
https://www.cnbc.com/2023/03/14/club-meeting-recap-cramer-sa...
This completely overlooks the changes that happened in that one year of not insane growth.
Apple cut Meta's legs off and Meta has no indication on how they're going to regrow them. The Metaverse is flopping, FB is seen as a place for hate, youths don't have accounts, etc, etc, etc.
Facebook is not the future of social media and Meta has not come up with a viable alternative.
The market has separated these 5 pretty clearly now, with Meta trailing by quite a bit, Alphabet and Amazon in the middle, and Microsoft and Apple with a decent lead.
Investors will tend to tolerate other faltering metrics for high revenue growth in startups, but that’s not Meta.
Public sentiment is terrible and if that's a reliable leading indicator, the company will be in trouble if it doesnt continually diversify into products that distance themselves from the core brand.
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His acquisition of instagram and whatsapp were good moves.
Rarely if ever do they true novel inventors dominate the market because when the market doesn’t exist they have to create it, and also they’re inventors not necessarily business men.
Ironically apple entering AR/VR may be the best thing to happen to Meta if it helps bolster the ecosystem. Meta may not be #1 in the space for a long time, if ever, but they may be able to ride the wave to a strong #2
-- Zuck probably.
I feel like 10K people are taking a hit because Zuck ruined VR for another decade with his very boomer like imagination and monetization strategy.
Anyway, it's rough out there.
What do you mean?
how is that any different than most of Silicon Valley?
Silicon Valley is what people thought the future looked like in 1994
It has taken Silicon Valley a long time to realize there is a limit to what you can do with websites and computers
Through robots in there and I'm not convinced there really is a limit, it just becomes difficult
When you run a business, you look towards the future and what profit you're forecasting. You don't want to see decline in profits, you don't want to use your cash reserves to compensate for less profit.
Facebook reported $23.1 billion net profit in 2022, a decline on the $39.3 billion made in 2021.
Once again, Meta's death has been greatly exaggerated on this site.
What changed were the expectations of what their profit will be in 5, 10, 20 years.
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> On February 4, 2004, Zuckerberg launched "TheFacebook", originally located at thefacebook.com.
If true, that’s a pretty crazy coincidence.
> whole metaverse thing
pick one
I just can't tell a story in which I would end up being a person who does that. It's too alien.
If you need to fire 13% of staff to get a 1.5-2.5% bump in price - that doesn't look great to me.
Almost seems like the market is signaling that they don't see any growth potential for FB outside of canceling the Metaverse.
I chuckled a bit. This is coming from a Social Media Company whose product is about connecting online. What does it say about the trust between users of its platforms?
Blanket statements like this are trying to make a multifaceted problem into a single problem. I don't understand why we are always so quick to say underperforming remote junior engineers are underperforming because of remote work. Maybe the problem was Meta went half in on supporting remote as an onboarding ramp and teams did not put the work in to make sure Juniors thrived in a remote environment.
Speaking from experience, If you are truly trying to be a remote company, you adjust as needed to support new employees, junior or not.
I've worked in the industry for 10 years now, and I don't agree "it's been known". Any measurable source of such claims?
It most certainly is not "known". I've managed remote teams, I've managed in-office teams and I've managed the same people in both scenarios. At no time was the office advantageous to innovation. Quite the opposite, it's a soul suck and once you free people to work how they are comfortable, their creativity will skyrocket.
It certainly takes discipline but I treat working from home the same as if I was in an office.
I am at my desk during business hours. People can Slack me, email me, call me on Teams, whatever. Besides, everything is logged. Every line of code, pull request, login time, email sent, all of it. They know what I'm up to.
That actually makes perfect sense to me from a practical perspective.
Nothing builds trust like callously laying off tens of thousands of people over multiple rounds of layoffs! Want a trustworthy environment? Earn it. Really though when he says "build trust" what he means is that he (Zuck) does not trust his employees unless he can see them.
You know that's not true. Facebook has offices around the world. No single person can "see" 80,000 people in any meaningful way.
So Zuckerberg, to prevent this, has the right strategy - the pirates inside the organisation strategy. Jobs did this with the Mac project. The question mark really is whether the Metaverse can deliver to take over from the Social Media platforms it has. Even if you accept the promise of Metaverse, according to Carmack the execution has been poor. Normally you just buy your way out with promising startups when execution is poor but the regulators will be heavy with Meta nowadays.
Meta has star power with AI/ML. But on Metaverse there isn't much consumer data to process (yet). So its innovation vector can't be realised.
This effectively means the stars of AI/ML won't help Meta into the future. If they leave, it could be a good thing (if we are taking the value-fuelled hypothesis as their future).
Meta I think will switch to a MBA-led approach to maximise existing value, shed its research aspirations, and switch to hiring the best mechanical/devices/hardware talent it can to improve execution on Metaverse.
Under this appraisal of Meta, broad and wide layoffs, letting the superstars go is the right thing for the company. Unlocked from Meta, those engineers will forge the next great wave of tech companies. The future will be made over the next few months as those start-up fevered ideas will actually get a footing. So I am most hopeful despite the bitter pill of current economic realities. In the short term there is real pain, particularly those relying on visas or the generous healthcare provisions from the company.
I worked at Nokia through their transition from being the largest smart phone manufacturer in the world to shortly before they sold off what remained of their phone unit to MS, who shut it down completely less than two years later. Basically, that probably affected many tens of thousands of people. I heard all the cliches and was on the receiving end of them. Two points here: 1) this is not personal even if it deeply effects you. 2) if you are not part of the solution, you are part of the problem. The last point here doesn't mean you are the problem, or the cause of the problem. But simply that your presence is no longer part of any solution to whatever the problem is. Whether you agree with that or not is beside the point. The fact is that, once companies get to this stage, there is only one way forward: let go of a lot of people.
IMHO, Facebook is being to cautious here. They need to cut much more deeply than this and re-focus on their core products and modernize those. Facebook has been dead in the water for years. Whatsapp has an aging user group as well. Instagram seems past its glory. Messenger seems like a failed product at this point. Time to take it out the back and kill that. Revitalizing Facebook and Instagram will require some drastic changes. It's not going to magically start turning around without that. It's either continued gradual decline or finding some way to become relevant again.
The trouble here though, is very few VC's have an appetite to fund now, especially seed / series A. They are too busy dealing with the overpriced and soon to fail cohort from 2020/2021
I spoke with a VC just last week from one if the top five, they are yet to fund anyone new this year.
So here's the thing. Who is doing better at this than Meta? Who could they buy? Regulation is a secondary issue.
At this point, the Quests are pretty good gaming machines. Its the software that's lacking. MMAAAN has traditionally struggled with content creation. It took a long time for the streaming studios to get any decent shows. Apple, Google, Netflix and Amazon don't really have a good game portfolio to this day.
They could possibly buy or spin up a bunch of game studios to crank out content but on the hardware side I think they actually are best in class here.
"In 2020, Meta added over 13,000 employees, a 30% increase, and the biggest year of hiring in the company’s history. In 2021, it added another 13,000 workers. By total worker numbers, it was the two biggest years of expansion in Facebook’s short history."
https://www.cnbc.com/2023/01/18/apple-had-slower-headcount-g...
This is the outcome of that.
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FB stock in 2020: 234 Today: 190
FB revenue in 2020: $86 billion 2022: $117 billion
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Safe to say that the web3 hypetrain is over.
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Back then interest rates were low and money was cheap. It was growth over profit and when money is cheap you can afford to run in the red as long as you're getting bigger. The minute interest rates went up companies had to rethink how they're going to spend money. We haven't seen the type of corp consolidation yet that we saw back then but it's still early days.
These are not the words of someone who has learned lessons or who is interested in telling the truth.
So here's a hypothesis: Facebook is not a "technology company," it's an advertising company. And spending on advertising has cratered as businesses everywhere have pulled in their horns in response to their own falling revenues. Facebook lived large during the fake boom. It hired way too many people and a built a bloated, middle-heavy organization that is poorly-suited to the task ahead: taking back territory it's lost to smaller, nimbler competitors. Facebook management bought the economic lies being told hook, line, and sinker.
The party's now over and Facebook faces major headwinds, including savage competition, declining revenue, and the aftermath of a hiring orgy gone wrong.
I think you need to RTFA ... it covers all those areas in great detail ... it's is one of the most detailed such posts I've ever seen like this.
I’m betting on Zuck here, and wish I could get this same level of specificity at my company.
There was also a lot of duplicative and overlapping work, which is mentioned as well.
Hypothesis? They've been an ad company for a long time.
"The author" is a bit of a strange way to refer to Mark Zuckerberg himself.
The 'efficiency' here is slashing operational expenses to boost earnings per share. That is a temporary boost, but one that can be repeated a few times.
When your team got spun up to work on this project, interest rates were low and it was a sound investment to try this project out. If it was successful, it might have made/saved a moderate amount of money. It made sense to invest in it, compared to all the other options available at the time.
But alas, inflation soared and interest rates rose faster than predicted, so now the bonds are a better bet than you and your team doing whatever it was you were doing. According to this spreadsheet, it wasn't nearly as profitable as the bonds.
Increased interest rates suck up this money because now there is something better to do with that money. Why "Do Stuff" when the returns on doing stuff is less than the ultra high savings yield you are now being offered.
It's virtuous when the stuff being done actually is destructive due to easy access to capital (e.g. 100 Ramen shops driving each other into further and further debt) but it's also a ham-fisted solution. It disrupts long term planning, even relatively conservative ones like "buy government bonds", and also just punts the problem b/c it's reducing demand by... promising more money in the future.
Meta is supposed to be a Tech company and invest the capital they have in technology plays
Also, FB isn't buying treasuries...