Startups Weekly: Tech layoffs spread (a bit)

Are January layoffs just a few post-WeWork jitters?

TechCrunch has found itself writing about layoffs at a few notable tech companies this week — and not just Softbank-backed ones. The focus is very much profits, as Alex Wilhelm summed up on Thursday, especially after the failed WeWork IPO and subsequent valuation and headcount decimation. We’ll be digging into the topic more soon but there does seem to be a certain consumery thread here. And perhaps some fears of negative macro trends bubbling up?

23andMe cut 16% or 100 people, citing slowing sales for DNA tests. Quora reduced an undisclosed number to focus on revenue. 

Plenty of tech investors have criticized Softbank’s approach to writing large check for large valuations, but they can’t avoid the same fears these days. So does Mozilla, which had to cut 70 people this month after struggling to build revenue products.

It still all seems sort of normal given the very high valuations and recent reconsiderations, at least so far. Layoffs may very well continue this year in a way that is necessary and even healthy in the long run.

More on TechCrunch, from Alex:

23andMe  and Mozilla are not alone, however. Playful Studios cut staff just this week, 2019 itself saw more than 300% more tech layoffs than in the preceding year and TechCrunch has covered a litany of layoffs at Vision Fund-backed companies over the past few months, including:

  • Staff cuts at Zume, the startup famous for considering making mobile pizza robots
  • Personnel reductions at Rappi, an e-commerce company
  • Cuts at Getaround, a car rental service
  • Layoffs at Oyo, a budget hotel unicorn

Scooter unicorns Lime and Bird have also reduced staff this year. The for-profit drive is firing on all cylinders in the wake of the failed WeWork IPO attempt. WeWork was an outlier in terms of how bad its financial results were, but the fear it introduced to the market appears pretty damn mainstream by this point. (Forsake hope, alle ye whoe require a Series H.)

Image: Bryce Durbin/TechCrunch

2019 venture data had soft spots, maybe

Fresh data sets are in on last year from Crunchbase, as well as PitchBook and the NVCA. Alex identified a few key takeaways: slightly lower early-stage fundings, a big global year overall, and some of the above WeWork-attributed drops already surfacing in the Q4 data over on TechCrunch.

I have to wonder what we really know right now, though. These are the best publicly-accessible funding databases out there, but many companies have stopped filing Form Ds with the U.S. Securities and Exchange Commission in recent years, as Danny Crichton has been covering in this ongoing series. That was a main data source, especially about early-stage stealth companies.

The Crunchbase report goes over the global trend for the year, and that’s another confounding factor, actually — how trackable are startup funding dollars across borders these days? And how do you account for remote teams in that mix? And how do you account for crypto…?

If you are building a company now at any stage, the financial signs out now are not in my humble opinion ones to have any fear over. Especially relative to the other problems that are almost certainly in front of you.

There is a lot of money in VC now regardless of anything else, as the Pitchbook-NVCA report notes, and there will be for a long time.

How to handle a recession

As if on cue, we had a couple guest columnists provide articles about capital efficiency and recession-proofing your company. Shin Kim has a two-parter on TechCrunch and Extra Crunch, where he breaks down why most tech IPOs are not WeWork (in a good way) and how to pace your own fundraising regardless of anything else going on. 

Schwark Satyavolu, meanwhile, digs into the best practices for startups in the next recession for Extra Crunch, starting with this brutal real-life intro:

I founded my first startup, Yodlee,  in a strong economy with almost 20 competitors. Ten years and a painful recession later, we were the only game in town. Critical to our success was acquiring our largest competitor, something we never could have done in a strong economy because they never would have been willing to sell. The recession made it untenable for them to fundraise, enabling us not only to buy them, but to do so without cash in an all-equity deal.

A proclamation about board diversity

Board representation is a hot topic for companies of all sizes and none other than Goldman Sachs said this week that it would only take companies public that had at least one underrepresented board member.

CEO David Solomon said that companies that had gone public in the last four years with at least one female board member did significantly better than those without, but Megan Dickey notes for Extra Crunch that’s not quite all the way towards the goal:

But the lack of people of color on boards is perhaps a more urgent issue. Late last year, a Crunchbase study found that 60% of the most funded VC-backed startups don’t have a single woman on their board of directors. But there are even fewer black people, let alone black women, on boards. A 2018 Deloitte study found that of the Fortune 100 companies, white men held 61.4% of board seats, white women held 19.1%, men of color had 13.7% of board seats and women of color had just 5.8% of board seats.

Connie Loizos, meanwhile, writes for TechCrunch that boards themselves are not all of the way towards the goal:

Let’s be real here. Directors of public companies typically meet just four times a year to review quarterly results. It’s important and necessary, sure. But beyond ensuring that strategic objectives are being met and hopefully making useful introductions to the company, these roles are assigned more importance by industry watchers than they should. (They often pay ludicrous amounts given the work involved, too.)

Even pledging that Goldman is only going to take public companies that give back — say 1% of future profits to the NAACP, as one idea — would instantly put the bank in pole position for those founders and investors who truly want to be progressive. Goldman might miss out on a lot of business in the immediate term, we realize, but we’re guessing it’s a gamble that would pay off over time.

Around the horn

Lame LPs, founder referenceability and the future of VC signaling (TC)

Why is everyone making OKR software? (EC)

Should tech giants slam the encryption door on the government? (TC)

Where top VCs are investing in adtech and martech (EC)

US mobile app subscription revenue jumped 21% in 2019 to $4.6B across the top 100 apps (TC)

Relativity Space could change the economics of private space launches (EC)

Can a time machine offer us the meaning of life? (TC)

#EquityPod

Alex and Danny are back on Equity this week, here’s a menu before you listen to the episode here (and if you haven’t subscribed yet, you can do that here).

  • Why Front’s latest investment (a $59 million Series C) is a pretty big deal. Not because of how much money it has raised — the firm has raised more in a single, preceding round — but because of who put the capital to work.

  • On the venture capital front, Danny and Alex also chewed over signaling risk in venture, and why bigger funds are writing earlier and earlier checks.

  • Also on the docket was the latest from Lambda School, which our former co-host and friend Kate Clark wrote. The gist is that regardless of how you feel about the company, your views are probably a bit too negative, or a bit too positive. (More on the company’s ilk from Extra Crunch here, and here.)

  • And three media deals, including The Athletic’s latest investment ($50 million), who might buy the company behind the hit podcast “Serial” and why Spotify might buy The Ringer. Which is about sports, it turns out.

    Want Startups Weekly in your inbox each week? You can sign up for this and TechCrunch’s other newsletters here.

Related post

Loading...
Populer Post
Scarlett Johansson Has ‘Been Asking’ to Be ...

Feb 25, 2020

‘There’s Huge Merit in Talking About ...

Feb 25, 2020

Did Queen Elizabeth II Just Make Up ...

Feb 25, 2020

Khloé Kardashian Has Been Able to Soften ...

Feb 25, 2020

‘The Bachelor’: Victoria F.’s Fantasy Suite ...

Feb 25, 2020

Why John Lennon Thought ‘World Without Love’ ...

Feb 25, 2020

‘Teen Mom’: Farrah Abraham Reveals Whether She ...

Feb 25, 2020

Ramy Youssef Wants To Be the Next ...

Feb 25, 2020

Queen Elizabeth Is Tired of Thinking About ...

Feb 24, 2020

Daniel Radcliffe Movie ‘Guns Akimbo’ Is Still ...

Feb 24, 2020

Party like it's 1999 with an HP Sprocket 2...

Feb 24, 2020

TSA quits using TikTok videos, with national ...

Feb 24, 2020

Purdue offers online students a VR graduation ...

Feb 24, 2020

Coronavirus outbreak halts Mission: Impossible 7 production in ...

Feb 24, 2020

Watch a Drag Race Between a McLaren 720...

Feb 24, 2020

Underwater photos of the year capture seals' ...

Feb 24, 2020

The Mate XS: A Huawei foldable will ...

Feb 24, 2020

No, You Can't Buy a Coronavirus Cure ...

Feb 24, 2020

Million-year-old seaweed fossils may be ancestors to ...

Feb 24, 2020

Saying Bernie Sanders 'rejects' climate reality is ...

Feb 24, 2020

Instagram influencer Natalia Taylor fakes Bali vacation ...

Feb 24, 2020

Hasbro announces 7 new D&D games starting ...

Feb 24, 2020

Venmo is reportedly testing out a debit ...

Feb 24, 2020

4 Small Habits That Can Make Any Business ...

Feb 24, 2020

Westerdam Passengers at Low Risk of Coronavirus ...

Feb 24, 2020

Tesla lobbies to change European semi truck ...

Feb 24, 2020

Clean up in the discount aisle: Save $200 ...

Feb 24, 2020

Michael Jordan retires Crying Jordan meme in ...

Feb 24, 2020

‘Nipple’ sweater worn by Whitney Cummings sold ...

Feb 24, 2020

Watch This Guy Build a Rocket with 1 ...

Feb 24, 2020

Jabra Elite Active 65t deal: Score a ...

Feb 24, 2020

Volkswagen may have electric sports car in ...

Feb 24, 2020

Realme X50 Pro comes with 5G, 6 cameras, ...

Feb 24, 2020

Best dating sites and apps for people ...

Feb 24, 2020

Half of women say their sex life ...

Feb 24, 2020

Chess grandmaster Gary Kasparov predicts AI will ...

Feb 24, 2020

As Fears of a Pandemic Mount, W....

Feb 24, 2020

9 of the biggest tax myths you should ...

Feb 24, 2020

EPA Might Finally Regulate PFAS But the ...

Feb 24, 2020

7 Essential Books About Pandemics

Feb 24, 2020

Robot suitcase uses AI to help visually ...

Feb 24, 2020

NASA thinks alien life might be hiding ...

Feb 24, 2020

Old Batteries Can Be Sources of New ...

Feb 24, 2020

Porsche 911 gets a human touch with fingerprint ...

Feb 24, 2020

2020 Harley-Davidson Softail Standard is a gateway drug ...

Feb 24, 2020

Everything you need to know about Honor’...

Feb 24, 2020

Mars has a whole lotta 'marsquakes' going ...

Feb 24, 2020

Quaden Bayles’ sister is a model, Aboriginal ...

Feb 24, 2020

Cosmic ‘Jekyll and Hyde’ discovered as NASA ...

Feb 24, 2020

Xbox Series X: Specs, backward compatibility and ...

Feb 24, 2020

Drone finds lost tomb with 72 ancient skeletons ...

Feb 24, 2020

Huawei owners use Google apps at your ...

Feb 24, 2020

Here are a few hidden gem TV ...

Feb 24, 2020

This portable record player is designed for ...

Feb 24, 2020

Trendy new hotels are transforming the Catskills

Feb 24, 2020

Microsoft finally shows us the Xbox Series ...

Feb 24, 2020

Ex-US Marine sets Guinness record by holding ...

Feb 24, 2020

Business Leaders Think These 7 Product Design Trends ...

Feb 24, 2020

US aircraft shot down during WWII discovered ...

Feb 24, 2020

Family says ‘luxury’ LA villa rental looked ...

Feb 24, 2020

This personal finance app is on sale ...

Feb 24, 2020

Best Picture winner 'Parasite' is coming to ...

Feb 24, 2020

Michelle Francesca Thomas recreates Montclair, NJ in ...

Feb 24, 2020

This AI suitcase could help visually-impaired people ...

Feb 24, 2020

Find a cheap flight with these top ...

Feb 24, 2020

Sony's Xperia 1 II has both 5G and ...

Feb 24, 2020

Watch these Netflix hidden gems on a 65...

Feb 24, 2020

HP Spectre x360 discount, plus more laptop ...

Feb 24, 2020

Louis C.K. Fans Are Legally Barred ...

Feb 24, 2020

Jill Duggar’s Followers Think She’s ...

Feb 24, 2020

3 Tips to Get the Most Out of ...

Feb 24, 2020

US: Allow tech giants to opt out ...

Feb 24, 2020

Here’s Instagram Evidence That Syngin and ...

Feb 24, 2020

Don’t miss Vimeo, Giphy, and Snapchat ...

Feb 24, 2020

‘Southern Charm’: The Cast Dishes About Who ...

Feb 24, 2020

Farming gave us salmonella, ancient DNA suggests

Feb 24, 2020

Katherine Johnson, Groundbreaking NASA Mathematician, Dies at 101

Feb 24, 2020

UK police are using AI to predict ...

Feb 24, 2020

Lauren Conrad Refuses to Return to ‘The ...

Feb 24, 2020

Coronavirus Live Updates: Outbreaks Raise Fears of ...

Feb 24, 2020

Green Ammonia Could Power the Future—If ...

Feb 24, 2020

Katherine Johnson, NASA legend and 'Hidden Figure,...

Feb 24, 2020

Microsoft reveals Xbox Series X specs     - ...

Feb 24, 2020

The 'Twin Peaks' box set is on ...

Feb 24, 2020

Elon Musk talks Tesla Cybertruck, issues more ...

Feb 24, 2020

’90 Day Fiancé’: Fans React to the New ...

Feb 24, 2020

‘Married at First Sight’: Taylor Says She ...

Feb 24, 2020

60,000-Strong Fridays for Future Protest in Hamburg, ...

Feb 24, 2020

Channel surf without lifting a finger with ...

Feb 24, 2020

This is the cheapest you'll find the ...

Feb 24, 2020

Hong Kong Says It Will Begin Evacuating ...

Feb 24, 2020

‘Zoey’s Extraordinary Playlist’ Star Lauren Graham ...

Feb 24, 2020

‘Vanderpump Rules’: Producers Share What Really Happens ...

Feb 24, 2020

Huawei's new foldable phone costs $2,700—and doesn't ...

Feb 24, 2020

New AirPods, iPad pop up in leaked ...

Feb 24, 2020

Instagram is changing how people pack for ...

Feb 24, 2020

New Genomic Tests Aim to Diagnose Deadly ...

Feb 24, 2020

Save 30% on the PowerPic 5x7-inch picture ...

Feb 24, 2020

The Oral-B SmartSeries 6500 electric toothbrush is the ...

Feb 24, 2020

3 Tips to Hire Smarter. Hint: Don't Skip ...

Feb 24, 2020

Apple-branded headphones for $399 might be around the ...

Feb 24, 2020

Why Aren't More Extremely Busy People Incredibly ...

Feb 24, 2020

What to Do When Candidates Don't Respond ...

Feb 24, 2020

The Coronavirus Outbreak Could Change the Way ...

Feb 24, 2020

Realme's X50 Pro 5G serves up 6 cameras, ...

Feb 24, 2020

Huawei's P40 Pro phone launch event to ...

Feb 24, 2020

Endangered Blue Whales Make 'Unprecedented' Comeback to ...

Feb 24, 2020

How To Build a Timber Frame Shed ...

Feb 24, 2020

Huawei ban: Full timeline as Google warns ...

Feb 24, 2020

Sony's Xperia 1 II is its first foray ...

Feb 24, 2020

Huawei brings new tablet, speaker and cool ...

Feb 24, 2020

This Classic New Orleans Business Strategy Will ...

Feb 24, 2020

Mate XS: A Huawei foldable will finally ...

Feb 24, 2020

These self-published authors are actually making a ...

Feb 24, 2020

Gas Pipeline Rupture Injures 46, Forces 300 to Evacuate ...

Feb 24, 2020

These neckband sport earphones include active noise ...

Feb 24, 2020

How to Capture Valuable Notes From Every ...

Feb 24, 2020

This Everyday Device Literally Scrambles Your Brain

Feb 24, 2020

'Kidding' showrunner on Ariana Grande and the ...

Feb 24, 2020

Saudi officials order arrest of rapper over ...

Feb 24, 2020

MeTooSTEM organization reeling after more resignations

Feb 24, 2020

How to 'Wow' Your Customer Throughout the ...

Feb 24, 2020

Why the Best Career Advice You Can ...

Feb 24, 2020

Disney+ is finally available to pre-order in ...

Feb 24, 2020

When You're Stumped in a Meeting, Here's ...

Feb 24, 2020

John Oliver's deep dive on India's prime ...

Feb 24, 2020

Feel the force of this animated Baby ...

Feb 24, 2020

Debating the Value of PSA Prostate Screening

Feb 24, 2020

When a Teenager’s Irregular Periods Are ...

Feb 24, 2020

Milk and Juice Are Not as Needed ...

Feb 24, 2020

The world's first onesie for dogs reduces ...

Feb 24, 2020

The Pros and Cons of Starting Up ...

Feb 24, 2020

Indian scientists decry ‘infuriating’ scheme to study ...

Feb 24, 2020

Research Says You Can Earn Way More ...

Feb 24, 2020

Sony Xperia 1 II has 5G and triple ...

Feb 24, 2020

‘The Invisible Man’ Movie Review: Man Oh ...

Feb 24, 2020

Most Highly Successful People Share These Traits, ...

Feb 24, 2020

Steve Jobs Was Absolutely Right About the ...

Feb 24, 2020

When Did BTS Film ‘Tonight Show Starring ...

Feb 24, 2020

Safari will soon reject any HTTPS certificate ...

Feb 24, 2020

‘The Bachelor’: When Is the ‘Women Tell ...

Feb 24, 2020

‘RHOA’: Nene Leakes Shades Kenya Moore by ...

Feb 24, 2020

‘The Bachelor’ Fans Are Afraid Who Wins ...

Feb 24, 2020

‘Good Girls’: What is Rio Going to ...

Feb 24, 2020

For China’s Overwhelmed Doctors, an Understanding ...

Feb 24, 2020

Flat-Earther 'Mad' Mike Hughes dies during rocket ...

Feb 24, 2020

‘Law & Order: SVU’: How Series Newcomer Jamie ...

Feb 24, 2020

Is the Upcoming ‘Star Wars’ Spin-Off the ...

Feb 24, 2020

Samsung temporarily shuts down a factory in ...

Feb 24, 2020

‘The Walking Dead’ Season 10 return sets up ...

Feb 24, 2020

HBO hides secret Westworld trailers on dystopian ...

Feb 24, 2020

There's a new hub for student dissent: ...

Feb 24, 2020

The best podcasts to fall asleep to, ...

Feb 24, 2020

Prince Harry Could Become an American or ...

Feb 24, 2020

‘RHOA’: Which Housewives Will Be Invited to ...

Feb 24, 2020

Galaxy Z Flip vs. Galaxy Fold specs: ...

Feb 24, 2020

‘Euphoria’: Hunter Schafer’s Character, Jules, Is ...

Feb 24, 2020

The Astonishing Details of Camila Cabello’s ...

Feb 24, 2020

Q by Aston Martin's DBX has wild ...

Feb 24, 2020

Aston Martin DBX gets fancier 'Q by ...

Feb 24, 2020

’90 Day Fiance’: Ed Has a Very Strange ...

Feb 24, 2020

’90 Day Fiance’: Is Nicole Nafziger Finally About ...

Feb 24, 2020

How China is destroying a precious Cambodian paradise
Investigation Discovery: 4 of the True Crime Network’s Most Popular Shows
Amazon removes fake products promising to 'kill' coronavirus
Sharpshooters to kill non-native goats in Grand Teton National Park
Pardon the Intrusion #11: No more passwords