I honestly don't think this counts as a spectacular failure. It's not like the entire company imploded. Spectacular failure is, I dunno, like Fab.com, Color Labs, or maybe Megaupload.

The Medium situation looks a lot more like Mixpanel to me. They overhired, they are laying off. Business are actually supposed to be able to do that, in a functioning flexible labor market, and I don't see why we should vilify them specifically.