Severance pay. We will pay 14 weeks of severance for all departing employees, and more for those with longer tenure. That is, those departing will be paid until at least February 21st 2023.
Bonus. We will pay our 2022 annual bonus for all departing employees, regardless of their departure date. (It will be prorated for people hired in 2022.)
PTO. We’ll pay for all unused PTO time (including in regions where that’s not legally required).
Healthcare. We’ll pay the cash equivalent of 6 months of existing healthcare premiums or healthcare continuation.
RSU vesting. We’ll accelerate everyone who has already reached their one-year vesting cliff to the February 2023 vesting date (or longer, depending on departure date). For those who haven’t reached their vesting cliffs, we'll waive the cliff.
Career support. We’ll cover career support, and do our best to connect departing employees with other companies. We’re also creating a new tier of extra large Stripe discounts for anyone who decides to start a new business now or in the future.
Immigration support. We know that this situation is particularly tough if you’re a visa holder. We have extensive dedicated support lined up for those of you here on visas (you’ll receive an email setting up a consultation within a few hours), and we’ll be supporting transitions to non-employment visas wherever we can.
Happy that some companies also start to do this in the US, but yeah it sounds that this is not a given. It will generate a better transition and avoid serious mental problems/personal issues.
This is pretty normal in my experience. Having experienced layoffs (never as a target, always from the side) for the last 25 years. There are probably edge cases, but some amount of severance (based on time with the company, typicall), healthcare coverage, bonus acceleration, etc, is all completely normal.
On HN, of course, you're mostly only going to see the edge cases posting, so it's easy to get a distorted view of normal.
Note that Europe is a big place, and laws are not standard for layoffs/redundancy. I got laid off this year, and basically got one week's severance pay, plus my two weeks notice.
In Ireland, I believe the standard amongst larger companies is one month per year served, but the cap is very low so generally tech companies will make much of the payout conditional on an NDA.
So I got doubly paid as soon as I found a new job. Good times. :)
They told me I could win jackpot but they would still legally owe me unemployment pay. It is all about actually woking. If you work and then get paid for that work, that's when you cannot claim unemployment pay.
So, technically, if you do contract work and still claim unemployment, then you are breaking the law.
IME 14 weeks minimum is really generous in the US.
I've been at 2 companies where it was 1 week per year of employment. At one company they added on 1 month of severance during a really large layoff. The tenure at tech companies in the US tends to be quite short, so getting 14 weeks probably unusual at typical tech company.
Is silver like "second place" or like "middle-aged" companies?
Faangs are obvious, good tier is up and coming businesses who pay and act like faangs. Examples are brex, stripe, Uber(at least back in the day, no idea what they’ve been up to the past year.
Silver tier are the places that still pay well above average jobs but don’t go into the mega compensation and suffer a talent drought as a result. Places where they’re paying 120k total comp for a senior engineer and won’t part with any equity because the leadership can’t emotionally handle the investment needed to compete for engineering talent for reasons that I could go on for hours about.
Wood tier are the companies that need tech but still try to pay <80k because they’d never pay high wages to any employee or still think they don’t need software and end up with some real shit engineering
Depending on the political environment of the state one is in. It could be capped at a useless amount, or the unemployment department minimally staffed. I know someone in NJ that has a pending status for 2 years with no response or ability to contact the state, and they have 8 years of W-2 showing they paid unemployment insurance.
In the event you do get through, you reach a line level agent, and they say a supervisor has to look at the case, and to wait 6 to 8 weeks before calling back. That’s it, nothing else.
I assume many people just give up.
I'm genuinely asking this question - I'm not trying to be a smart ass.
I worked at a tech company (~3500 worldwide) that had an office in almost every major US city area (e.g. Bay Area, NYC, Boston, Chicago, Seattle, and a bunch of Tier 2 cities as well (Atlanta, Raleigh, Houston, etc), and remote workers (e.g. sales) as well.
They had a big layoff and in theory they could laid off 500/15% people worldwide without laying off 50 people at each site. Would that still trigger the WARN act?
You should still do it.
Do you think their doing it for shits and giggles? Or do you think that they've actually done the math?
How did Stripe end up with expenses they need to reduce if they did the maths? Yes, their world changed, but at some point they made choices that were incorrect and here they are.
Of course, its presented as largesse to the recipients, but its very much not.
60 work days must be paid out, which is 12 weeks of work. So essentially they're giving people only an extra 2 weeks of severance to sign away their right to a wrongful termination lawsuit.
I just read the rest. On top of 3.5 months pay, they get accelerated vesting, cash payment for healthcare benefits, all unused PTO paid, and more. That’s incredible.
At the moment the precedents are still heavily employee biased, but you ask for whatever you want in your contract during negotiations. Negotiate your sick pay, negotiate your PTO, negotiate your vesting schedules and exit terms, negotiate your hours and time in lieu policies. Negotiate your Intellectual Property terms. That one is super common to see lopsided toward the employer. We don't have unions or award rates, so we also miss out on some of those protections, hence why we need to make sure it's in the contract.
Even the nicest, fairest business owners I've worked for will start with industry standard contracts that do their best to shaft you, because it's industry standard and they don't see it as lopsided. But I've never had trouble negotiating for this stuff to be made clearer and fairer.
Generally, employees in America do not have contracts. While plenty of things are open for negotiation during the offer/hiring process, I doubt you'll get an exception to a corporate policy on paying out on PTO if it's not something they already do.
That said, IME, accrued PTO has always been paid on departure (voluntary or not). For this reason, most of the places I've worked heavily encourage (or even require) taking PTO, because it's a liability on their books.
Is that true? The company surely has terms for you, like expected working hours, terms about your sick leave, performance and health terms, out of office expectations, intellectual property disclosures and NDAs? Non-compete clauses? When does all that become binding if not through a contract?
I've never seen this in the US. The only things typically up for negotiation is the sign on bonus/equity and base pay. If you start trying to negotiate vacations and holidays, you're going to look pretty silly.
> The Fair Labor Standards Act (FLSA) does not require payment for time not worked, such as vacations, sick leave or federal or other holidays. These benefits are matters of agreement between an employer and an employee (or the employee's representative).
Everything is up for negotiation. Just depends whether or not you have options. I have seen PTO negotiated in the US.
Everything is negotiable. That said, the bigger the company, the harder it can be.
F500 company and you want a line out of your mid-level developer contract? Their legal likely doesn't have time and they will just hire someone else.
Startup? Literally write your own contract.
In any major city in the US, a software engineer is probably making in the top 10% of area and there is little excuse to not have 3-6 months savings.
Reminder that the US has the highest median disposable income in the world, not just the highest top percentiles.
In California, accrued vacation is part of wages and must be paid out as part of wages. However, unlimited PTO policies typically don't accrue vacation.
In Washington, it's "read your contract." If your contract doesn't say that they pay out accrued PTO upon separation, they don't.
The smart businesses would just actually bank the dollar amounts and not worry about it, but those are rare.
If you are handed $73,000 and still need to frantically look for a new job, something strange is going on.
Your taxes would only be 40% (actually 47%) if you make beyond $500k a year. Cobra rates are quite affordable. I was on Cobra when I was laid off due to covid, and it was $550 a month for top tier healthcare.
$550 for gold level insurance is expected for someone young, which I guess you are.
You can ballpark almost anyone’s premiums based on the figures in link below. I would use Omnia Gold or Omnia Silver HSA numbers, and plus or minus 20% for your state.
https://www.state.nj.us/dobi/division_insurance/ihcseh/ihcra...
Those two statements are in odds with one another. $550 is quite a large sum of money to put out each month, particularly when you don't have an income.
(I actually do not have any compulsion to drink coffee, or anything much other than tap water).
On a serious note, I cannot blame many young people for eschewing forming families of having kids when faced with the numbers I quoted.
Obviously family plans etc. will be considerably higher.
You'd get that withheld money back after filing taxes, but most people who are laid off would prefer to have that money now.
If Stripe is making regular salary-like payments instead of one lump sum, then the taxes would be pretty much the same as always.
You can get health insurance from healthcare.gov
Granted not California, but the federal bit is the same - https://oci.wi.gov/Documents/Consumers/HealthInsuranceLostCo...
> I thought the open enrollment period was already over for HealthCare.gov. Can I still enroll?
> Yes, if you have just lost your health insurance, you are eligible for a 60-day special enrollment period. You can work with an enrollment assister, an insurance agent, or use HealthCare.gov to enroll in a new insurance plan. You may also qualify for a special enrollment period if you have experienced a life event such as moving, getting married, having a baby, or adopting a child.
also all the income and benefits are taxable
Keep in mind that this is interviewing without a job taking 40 hours (or maybe more) of their time every week.
Interviewing is much, much easier when it replaces your job and you're still collecting paychecks for several months.
Not poking at you directly. I've got 25 years of experience. I was on a team a few years ago with people with... 2-4 years experience. We were both labelled to the end client (contracting company) as 'senior developers'. It's just weird all around. When everyone is 'senior', it loses any useful meaning.
The levels are fresh out of school, have learned enough to not need hand holding, and able to make good decisions about code. You cover them very fast. There is a staff level about that, but most people don't reach that level. There just isn't need for too many of them.
In my experience, if you’re job hunting and don’t have an offer in hand by November 1st, you’re probably not going to get one until mid-January.
The “normal” interview process takes 4-6 weeks in my experience from application to offer/rejection. That is doubled between Thanksgiving and New Year’s Day.
That 3.5 months and healthcare buys them some time to start interviewing and line up new work. However, they're competing with everyone else that's been laid off recently. There's another article on HN right now about Lyft laying off staff. Meta is getting pummeled in the stock market right now and Google has recently had hiring freezes. I'm not sure now is a good time to be looking for tech work in SF.
Unused PTO should be paid out. That was already earned by the employees.
Accelerated vesting is only good if you can afford to use it. How long do they have to exercise their options? What's the secondary market like right now for Stripe stock? Are they allowed to sell stock currently or required to hold it? In a worst case scenario, people could be unable to exercise their options because they don't have the savings to cover the tax bill and want to hold onto cash because they're unemployed and need the liquidity.
As for healthcare benefits, that's a result of a very broken system in the US and not something that should be celebrated.
Would've been a different story for instance if pc/jc were diluted with new grants to departing and existing employees.
But in the face of fundraising headwinds, a decision to cut costs like this only improves (or stabilizes anyway) their ability to raise at a valuation closer to what they're looking for in this down market. The severance package here only deferred the benefit to the bottom line, but it wasn't a consequence for over-hiring and potentially disrupting lives.
In other words, the layoffs actually benefit the founders directly, and it ends up becoming a perverse incentive to over-hire and lay off again with the next boom/bust. Successful accountability means people actually avoid doing shitty things.
This is exactly how business works. You should not be surprised. Their job is to ensure the company survives and that is really it. Everyone is expendable. None of these employees were guaranteed a long leisurely employment at Stripe.
Businesses change overnight. But it's always a cyclical market. As the founders I would expect them to benefit themselves. There doesn't have to be consequences, only change and adaptation. It's just business, they aren't your family.
This is all complete nonsense. They're handing out millions of dollars they have no obligation to pay. Unlike cheap talk on the internet, this actually costs them quite a lot. This is extremely generous.
I would still take the deal. I would work there if they hired me. If there are enough people like me to continue the business, then this thing turns out to not be shitty. Only time will tell.
"Leaders eat last"
"We cut the fat starting at the top"
"Leaders need to have endurance beyond their troops"
I have no skin in the game either. The severance packages are commendable, but I don't think it actually answers the OP's question about accountability. I don't want to speak for the other commenter, but I think what they're looking for is some indication that the leadership has personally sacrificed something equal to or exceeding what they expected out of their subordinates. Giving out millions in severance, while commendable, isn't a personal sacrifice.
I keep a go to hell fund, an updated resume, an updated career document, a strong network of former coworkers, managers, and external recruiters and make sure my skillset is in line with the market.
I don't think "for profit" and "good leadership" are mutually exclusive.
You don't expect them to pay you? Treat you with respect? To observe labor laws? Surely, you expect something from them. Being willing and able to walk away is not the same thing as saying you have zero expectations.
2. I addressed the other one. When the pay/bullshit ratio goes the wrong way, I leave.
Do y'all expect them to cut their arm off? I'm not defending pc but the OP's comment wreaks of corporate SJW.
> but I think what they're looking for is some indication that the leadership has personally sacrificed something equal to or exceeding what they expected out of their subordinates
Millions (and billions) come out of their valuation as a result. It's not like they're getting whisked away on a golden parachute.
It's the exact opposite. They're more likely to stem the bloodletting of their valuation with layoffs extending runway or boosting profitabiliy than see it get worse.
That depends. Are they expecting their subordinates to cut their arms off?
I do think a lot of discussion seems to point to how we, as a society, have adjusted our social norms about what's expected out of leadership.
Do you expect company management and subordinates to have symmetrical work obligations?
It feels like the social norms have shifted to accept one but not the other. In other words, we're only supportive of an asymmetrical risk:reward ratio that favors management.
Actually we have, the risk:reward ratio is generally consistent across founder/management vs IC.
Are you simply saying that because CEO to IC pay ratio has expanded drastically in recent years that it's not accurately accounting for the risk? You realize that ~x% cut in workforce includes managers right? In fact, often times cheaper more productive ICs stay and expensive middle management is first to go. Seems like that is accounting for it no?
It’s something a lot of us are sensitized to these days because of all the narcissists who “take full responsibility” which seems to mean to them that taking the blame is a dire punishment and no other consequences are necessary.
Being the scapegoat is not a real consequence. Not getting that villa you were talking to an agent about is a consequence. Not getting your bonus at all is a consequence.
The general argument for high CEO pay is that it is a reward for their skill in the job. By that argument, if there is evidence that they're making mistakes that negatively impact the company shouldn't that directly impact them in terms of their compensation?
As the owner of a (much, much) smaller company, I'm inspired by how the Collisons run their business, especially under adverse circumstances. Yes, they fucked up in estimating the future market, but they are in good company among CEOs and non-CEOs lately.
Well done stripe. Maybe others can follow your example.
If you "walk out" i.e. quit, then severance doesn't apply. Severance is for people they're laying off. But, yes, if you get let go on Friday, you can work elsewhere on Monday, unless Stripe has specific non-competes in place (which aren't legal a lot of places).
> This setup is incredibly generous in my mind to the point where there's a lot of incentive to get laid off. If you got another job in a couple days
When we're in an economic downturn, and a lot of other companies are conducting layoffs or hiring freezes that is easier said than done. Definitely was a rough experience in 2007/08 during the last big one.
But either way, they should still come even if you get hired immediately (except I guess hired back at Stripe).
That’s very generous severance and the company doing right by its employees.
I don’t know how long the process is for non US citizens. But in my over 25 year career, and changing jobs eight times as a software developer, it has never taken me more than a month from actively looking to having a couple of offers. 14 weeks and bonus and paid out PTO is more than enough.
I think the issue (also related to how we interface with the internet) is that most of these replies completely dodged the question. The OP was asking about personal accountability, not about "how are your going to make this as palatable as possible."
Consider two scenarios:
(1) A manager fires half their workforce, but gives them a generous severance. In response, the manager gets a massive bonus.
(2) A manager fires half their workforce, but gives them a generous severance. In response, the manager forgoes their salary for a year for being the one making that decision.
The second has personal accountability because they are making a personal sacrifice beyond what they expect from their subordinates, even though the employees are affected equally. I'd be willing to bet one organization has more institutional trust than the other.
In theory he had to cut her too, because he was something like $30K short of the goal and her salary as an office admin would have more than covered that. But then he’d have to do her job. His solution was to cut his own salary enough to hit the target to the decimal point.
They landed a new contract a handful of months later and were eventually able to hire back one of the people they lost.
I think he may have even backdated some raises they missed out on. He was her best boss.
If the through-line wasn't obvious, it's that leadership quality matters. Trust matters. When you decide to stay with a company or invest in a company, you don't have the privleged access to know that their actions "won't have any effect" on your ability to pay your bills in the future. In the context of uncertainty, leadership quality matters.
You bet on the jockey, not the horse.
A job is not a marriage. I’ve been through many “uncertain times” in over 25 years.
I depend on my savings, network, skillset, updated resume and updated career document, not “trusting” a for profit company.
Do you not expect anything out of your teammates? Do you have no expectations from customers? From politicians?
At a certain point, how you manage interpersonal relationships can limit your path. Sure, you can just devolve everything down to a transaction (even a marriage) and maybe that works for you. And you can create a life free from any obligations or commitments, outside what you want for the aesthetic life of your choosing.* But it doesn't seem like it would be the type of existence many people envy.
* David Brooks book "The Second Mountain" does a good job explaining the downsides of this approach.
I expect the same from my coworkers as I expect from myself - that they do their best work for 40 hours a week.
> Do you have no expectations from customers?
I work in the cloud consulting department of BigTech. The expectations of my customers are spelled out in detail by high priced lawyers.
> From politicians
Hell no.
> At a certain point, how you manage interpersonal relationships can limit your path. Sure, you can just devolve everything down to a transaction
A for profit business and your relationship with your company is transactional. Especially in any large company. The CEO of my company wouldn’t know me from the other 1.6 million people that work at the company.
I also lived through 2001 and 2008. I think the last 12 years of perpetual growth have created some amazing expectations from people. I can only hope that, once I get laid off, I'll have to "settle" for some $175k job in an office after my 3 months of severance runs dry.
I kept my job through that but it was a very head-down situation. Just put up with this shit until the market recovers. Then the company had a good year and so a bunch of us stayed to get the bonus. So February 2010 saw nine of us who had quit in 8 weeks, sitting in a bar celebrating our exodus. I asked if it was worth it (staying for the bonus).
One person said yes. Another said maybe. Seven people regretted staying. The bonus amounted to less than 20% of salary and we were under market at the time.
We used to have coffee and discuss how much we hated our boss Mike (not a pseudonym. Fuck you Mike, you brown nosing ladder climber). My peer called our favorite table the Conspiracy Table.
Few professions earned this quality of life, doctors and lawyers, and I can promise they aren’t sitting around going “maybe we’re spoiled, maybe we oughtta curtail our expectations”.
No, take the life you have and don’t go backward. Most people working aren’t given an ounce from their industries, many of them still fight for basic stuff to this day.
Tech should not be okay with these levels of lay offs and still revere these companies. This is the stuff the car industry did when they just offshored jobs, and collapsed entire cities (Detroit). Why should we be okay with the same playbook?
Absolutely! I declined multiple offers this summer because they would have been pay cuts. We agree.
> Few professions earned this quality of life
Well that is a can of worms. I'm going to guess Doctors deserve much better. I think the unfortunate reality is that, maybe, tech workers haven't earned this quality of life. Instead, we are the lucky recipients of decades of growth. This is something that isn't even shared in Canada or Europe, much less Asia, in terms of salary.
> This is the stuff the car industry did when they just offshored jobs,
Agree, this is going to be bad. Now that we have shown productivity with work from home, how tied are companies to these high USA salaries?
I'm not ok with it. But I also remember that when I'm running around looking for a job, the people with that job are making the demands. This is something that tech workers haven't actually experienced for a decade, but every other industry has.
> okay with these levels of lay offs and still revere these companies
Revere these companies? Founders are taking risks to make a LOT of money. They aren't here to make employees money. I don't revere these companies, and I don't put any stock in their Family Friendly or work life balance encouraged, marketing nonsense.
This is financially nonsensical. Every month you delay working you have to make more to get the same amount over the course of the year.
Just to make up a number, if your target was $120K and they offered you $110K and it took you a month longer to get $120K, you would need to make over $130K just to reach $120K.
I would take close to what I wanted and then change jobs if something better came along.
Scrounging on the web suggests that Stripe may be EBITDA-profitable but not GAAP-profitable. $60M (perhaps double that with all the other benefits laid out here) is easily enough to delay GAAP profitability by a quarter or two. That may not seem like much, but it has a huge impact on investor sentiment.
[1] 0.148000200000*14/52
"Feeling super bad about this" is not actually a consequence.
I worked at a company that had massive layoffs, leadership claimed it was the hardest day of their life, two weeks later they were literally laughing about the people they laid off when they realized they already had to rehire for some of the positions.
Saying "we take full responsible" here doesn't translate to accountability, it means they want to start the conversation by absolving themselves of any guilt.
So I start suspecting anyone who talks like this if narcissism. The orange toddler talked like this too.
I sorry, but the wording rather funny. That sort of suggests that it was somehow an option to not pay for used PTO, even if they are legally required to.
At one startup... I got called into the HR office on Monday morning, laid off with no advanced notice, and was only offered two weeks severance provided I signed a non-disclosure agreement that banned me from saying anything negative about the company for two years (and there was a lot I could've said).
That company also lied big time about their financials to get me to join in first place. So I learned some valuable life-lessons...
I was in a somewhat similar situation - got laid off in 2020, with a great severance pay etc. I was on a working visa which got canceled within a couple of weeks (not sure how it works in the US, I was working in a different part of the world). The market was low so it was difficult to find something quickly to get another job visa. On top of that I couldn't get back to my home country, since the borders were closed due to COVVID. I had to live for several months on short-term visitor visas and had to renew the visas constantly - it was a separate bueracratic hell. Eventually I found a job and got a permanent visa, but these months cost me and my family a lot.
So here's the question - would it be (legally?) possible to put the visa holders on garden leave and pay them i.e. $1/m until they found a new job? Or at least do it temporary, for like 3 months or so. Because honestly, I didn't care at all about the money and stuff, the visa problem was absolute hell.
"We know that this situation is particularly tough if you’re a visa holder. Basically you are fucked. Here is a dildo sign to show you in picture what your situation is. There is nothing called non-employment visa. So here is a picture of two dildos if you are still reading this"
People like to <poop> on CEO's & leaders in good times, but employees often forget that while the employee can just go get another job, the leaders have to keep hundreds, thousands, of people employed while also retaining customers and dealing with investors. They have to deal with keeping those hundreds/thousands employed every...single... day.
SQ 2021 Revenue: $17B SQ 2021 cash and short term investments: $5.3B
Stripe 2021 Revenue: $12B
Similar businesses, operating in the same market, with the nearly the same number of employees (about 8000). Barring exceptional circumstances, we would expect their financial health to be roughly similar.
You said it yourself:
> the leaders have to... [deal] with investors
The economy is contracting and their share price is falling. They could afford to dip into cash and keep everyone on board but their investors are more concerned about propping up the valuation. They don't have two shits to give about the people they're letting go.
> They could afford to dip into cash
Why should they risk cash reserves with an uncertain future? So that they can layoff 30% later on if things get worse?
https://www.wsj.com/articles/stripe-cuts-internal-valuation-...
Why? Because periods like now is the absolute best time to steal market share from established companies - which would grow the team and business. Startups (competitors) begin to post less risk because they'll be hard to find financing.
So - if growing the business is a CEO's top responsibility...if the leadership felt they could steal business from others that experience attrition - they would. My guess is they don't seem to feel that way about the current moment.
They're worried about surviving the contraction, nobody knows how long it will last and that cash only goes so far.
This an example of how bullshit jobs are created. Why keep people on a payroll if you have no use for them anymore?
It's not like startup founders who haven't been taking a salary (or been taking a below-market salary).
...can usually afford to never work again!
No, the created the business in attempt to get wildly wealthy and unfortunately they can't do this without also having to hire a bunch of people. They certainly don't create the business for the sake of employing people.
> People like to <poop> on CEO's & leaders in good times
In my experience the opposite is true, in good times people can't help but <polish the nob> of CEO's & leaders, since easy employment and good pay make the fundamentally exploitative nature of their relationship less visible.
> employees often forget that while the employee can just go get another job, the leaders have to keep hundreds, thousands...
of thousands of dollars in their account even when they "fail".
The key difference is that if I don't get another job, I lose my house and ultimately the ability to feed myself. If I don't play the game I quite literally am sentenced to death. The CEO of that lays off thousands can very easily spend the rest of their days in comfortable retirement at any given point.
I need to sell my labor to live, CEOs need my labor to get richer.
Such execs are usually already so wealthy that they never have to work another day in their life, no matter what happens or how much they screw up.
They can always find other prestigious, high paid jobs, and sometimes even get rewarded with huge amounts of money from the very companies they screwed over.
Their psychic abilities failed? A coin flip came up tails but they bet on heads?
“Do you care to know why I'm in this chair with you all? I mean, why I earn the big bucks?
I'm here for one reason and one reason alone. I'm here to guess what the music might do a week, a month, a year from now. That's it. Nothing more. And standing here tonight, I'm afraid that I don't hear - a - thing. Just... silence.”
-John Tuld, Margin Call
is "we're a fast growing business but this cannot last indefinitely, let's not overexpand" ´really too much to ask for? It's constantly happening to tech companies because of their internal fantasies.
Isn't it interesting how we want to absolve execs of all blame when they bet wrong and get unlucky, but declare them geniuses and masters of business when they bet right and get lucky?
But overall Stripe has A+ execution -- of which very little was luck -- and the founders deserve credit for that.
Not surprising to see execs and founders on here patting each other on the back and trying to convince everyone that they deserve their millions because of how innovative they are all the "value" they create. Looks like the old HN to me.
This is the norm I've witnessed. They're rewarded for making bold bets, whether or not they pay off.
Just to be sure, there is a big difference between a bold bet based on your market or product insights vs putting everything on black on the roulette table.
If leaders were rewarded for being conservative instead of making bold bets, Linux and open source would never have taken off, nor would most tech startups.
That is because any exec worth her salt would negotiate a generous golden parachute even before starting the job. And why is she able to do that? Because there are very few competent candidates available in the market. If you think the job is easy, just go and get one of those exec positions and you will learn.
Just because you're hired for one of those positions doesn't mean you're competent.
Do you have an idea to judge exec competence effectively? If so, you can have a very successful company based on that.
Yeah we know you're responsible for it, but how are you being held accountable for it?
No one will remember in two years time, but my hope is it'll factor into candidates' decisions around whether to pursue a career with Stripe. If I've got senior executives without accountability, it's a distraction to my ability to deliver the product as well as to lead my own teams supporting their vision because it means I can't rely on them, and this outcome with absolutely no accountability behind it is a good enough reason for me to never want to join Stripe in the future.
Good examples of accountability to the board? All over. But boards care (by mandate) only about profit unless specified otherwise. There's no incentive for a board to care about whether people are put out on the street either; it's one of the major reasons for why unions exist and are successful: they provide a mechanism for accountability that ties adverse employee decisions back to future revenue loss.
Tl;Dr: nope, and that's sadly by design because why would anyone be self-accountable when the consequences hit the wallet? I was hoping for a ray of light to pierce the dark.
Why would the union do this? It seems like a contrived example to prove a point. Unions would conceivably benefit from more hires because they would have more union membership.
My anecdotal experience is that unions are a massive benefit to laid-off employees. Laid off employees were given 80% pay while they waited with a known re-hire date. In other cases, they are given priority when the company is looking to rehire with an unknown rehire date. Unions have downsides, for sure, but I don't think your example points them out here.
And my example was simply continuing the original poster’s insinuation that a union could have helped management avoid the over hiring mistake they were about to make by making the consequences of that mistake greater.
What you said does make sense though. The union apprentiships were extremely competitive, possibly because they were constrained to low numbers.
Also, Japanese execs are paid substantially less than their US/UK counterparts.
I doubt that it has happened in quite a while, but there have been CEOs that have committed suicide, when their companies failed.
Doubt that will catch on, in the US.
A lot of the nice stuff that musicians and actors have, is actually owned by the company.
Gilded cage, so to speak.
(Tbf, I'm sure he was told to resign. But that's largely because the Navy has tried to institute a culture of accountability, albeit imperfectly)
After having to layoff a lot of their staff in the 90s, Chouinard decided to switch his compagny values and reason of being.
This article sums it up I guess, https://medium.com/@adamler/limiting-the-engines-of-growth-a...
https://www.fastcompany.com/3056662/she-created-netflixs-cul...
Remember, “companies don’t exist to make you happy. You know that, right? The business doesn’t exist to serve you. The business exists to serve your customers,” reminds McCord.
she was apparently a big deal but i think you gave her more credit than deserved there heheh
Why do people keep working and earning more when they are set for life--what actual practical purpose does megawealth serve once you've guaranteed your standard of living for you and your offspring? The purpose is lack of accountability. Megawealth means you can spend every remaining day of your life screwing up, and besides doing something illegal that lands you in jail, you'll never suffer a consequence.
I think this is the wrong question to ask -- "what end is this a means to anymore". One of the largest challenges in life is pursuit of meaning, and Zuck has, at least he thinks, found it. He still has consequences, but they are higher up on Maslow's hierarchy of needs.
You could argue that those in charge should have enough at stake to feel the burn of a layoff like this, but this issue isn't dissimilar to biology. We often make local (and temporary) sacrifices on behalf our own bodies, knowing "we" will still be around afterwards to enjoy life and the removed parts won't (removing limbs, wiping out blood cells, organ removal, etc.). This isn't 1:1 with Zuck, because Zuck is more than just his role in Meta, but close enough.
Actually, yes, as it could open up career opportunities for others further down the totem pole. At almost every company I've ever worked, the CxO, SVP, VP roles were all hogged up by already-set-for-life people (or people who became set for life by working there a few years). They just hang on to those very senior roles like barnacles, while the rank and file fight each other their whole careers for a few open Director or manager roles.
If already-rich people could just admit they won the game and gracefully resign to "spend more time with their family" or "look down their noses" or whatever rich people like to do, maybe some of those Directors could be promoted to VPs and some of those managers could be promoted to Director and so on. This would help refresh the tree a little, cycle new blood through leadership, and help even more people climb the ladder.
Is that ritual suicide?
If they just give it to you straight, there’s no bullshit - the people fired may be mad or upset but they'll be mad or upset regardless because being fired sucks. If they start hand-wringing, talking about how painful it was for them and how they take full responsibility people will ask “hang on, how exactly is this painful for you? how are you taking responsibility, what are you doing about it?”
These risks come with the territory; there's a whole rest of the world outside of Silicon Valley where things move a lot slower; beyond that, there's still another rest of the world where people are literally struggling to put food in their mouths.
Working in a startup and getting big salaries and stock options, but possibly losing said options, are all part of the risk of doing a startup, and the people who took the initial risks will always deserve a bigger piece of the pie.
I want to make it clear that i'm 100% supportive of what Stripe is doing though. It's exceptionally generous and unorthodox to do this for your (soon to be former) employees.
I believe the company’s revenue is heavily tied to Shopify whose stock is down -75% ytd…
It's about the empty platitudes they and all people like them spew. "they take responsibility" what does that even mean? It's meaningless.
Are they taking a paycut themselves? Letting themselves go instead of their employes? Cutting down on bonuses to keep their people employed?
It means they're not blaming anyone else for this. The opposite of taking responsibility is assigning blame. They aren't assigning blame, they're taking responsibility.
I was talking about the alleged 'responsibility' by the billionaire owners. Yet said responsibility doesn't lead to job loss or anything. It's empty words.
I'm sure they're devastated
https://www.google.com/search?hl=en&q=meditating%20collison%... Gives nothing at a glance. Do you have anything?
This sounds a bit emotional to me. Layoffs can be an emotional topic, but let's reflect for a moment.
I guess the thrust of the remark is to put some sort of public "shame" on companies that perform layoffs (especially such fast ones) for the major inconvenience they cause for thousands of people. I suppose the fear is that without any "Shame" these companies will hire and fire spuriously without repercussion?
Relatively speaking I think Stripe handled this well. Yes it was a mistake to hire these people, but now that you're here it would be a bigger mistake to keep people you don't need.
I wonder if every company would be so forthright about this or whether many would just "cut" "low performers" at an accelerated rate over a year with no severance.
The op question is not emotional in the slightest. The executive leadership made a series of mistake. People are left in the lurch and the business has suffered because of these mistakes. Asking if the incentives are aligned here is a strict matter of rational business calculus.
I don't think that's what he meant. He is asking whether the CEO is just blowing hot air when they say "we take full responsibility..." or whether there are consequences to their bad decisions, i.e., responsibility for those decisions.
I guess that's the problem? These days leaders have no problem "taking responsibility" to make themselves look good when there's no consequence("hey I did what all good leaders do").
Either the CEO is implying that they aren't always responsible, which is bogus, or they are stating an obvious fact as an empty platitude, which is most likely the case, or perhaps they're implying that to them "responsibility" means more than just "taking the blame" which is probably not the case here.
software dev here - was working with a client, and a pm was pushing some not-great idea. I pushed back - "this is not core, not important, shouldn't be a focus, other things are more important, and already decided".
Pushback from them: "no no no, this is vital. Look... if there's a problem, I'll take responsbility".
6 months later, there's a lot of complications that I'd foreseen (and documented) earlier which were summarily ignored at the time. The "I'll take responsibility" person isn't on the project any more - they left. I'm fielding a bunch of "why was this done? this wasn't agreed on - what were you thinking?"
Well... when I don't do what they ask for, I'm stubborn/obstinate/roadblocking/etc. When I do it... it's wrong. Even if that original person was still around, I would be the one fixing all the bad data, having to reverse out the changes, revert to earlier state while keeping newer code in place. The "I'll take responsibility" is essentially meaningless in many situations. And I called that out too at the time and was told I'm too negative/cynical. It's just experience.
Lest this be seem like doom and gloom, I've experienced the opposite situation from above, where 'ownership' and 'responsibility' and whatnot were more enforced and honored across an organization, but it's been very rare in my experience over the last 20 years, and seems to be getting even less common. Having seen both situations, it's easier to tell the difference.
More and more folks having shorter tenures makes it harder for any org/team ethos to 'stick' for any meaningful impact, and absent that, it takes a lot more organizational effort to keep a commitment to stated corporate values. Not impossible, just hard to do, and often slips...
They don't owe you anything. Not an action. Not even an explanation. The world doesn't owe you anything either.
They took responsibility by responsibly doing well by their former employees.
To many it looked like covid, wfh, etc resulted in a new world with a permanent step level increase in the internet economy that caused Stripe's business to dramatically increase and thus the founders grew the company to support the activity and continue being the best and most innovative internet payment service.
It turns out unfortunately the growth was temporary, inflation skyrocketed, and the world is probably heading into a recession that will further decrease or slow the growth of the internet economy and thus Stripe's business, so the founders are acting quickly and responsibly to cut costs in order to maintain a position of financial strength and continue growing the business and being the best and most innovative internet payment service.
In time, if Stripe continues to succeed and have exceptional business performance, the consequences to the founders should be financial reward for taking quick and effective beneficial action that grew the business.
It's good to see leaderships take responsibility and change course in the best possible way. But the whole this is our fault, we should have seen this coming story is a bit nonsense. They are just being nice about the messy situation and taking responsibility even though its outside their control.
1. Some way to help with the immediate layoff. Reasonable severance/etc is about what I'd expect.
2. Concrete action to prevent the problem in the future. The post identifies specific errors in judgement and at least pays lip service to avoiding layoffs in the future.
I'm not sure how serious they are about 2—given the structure and incentives of large corporations, how serious they even could be about it—but at least they're talking about it. I would not be surprised to see growth pressure overwhelming any strategic or cultural changes they make today if business conditions pick up again, with the whole cycle repeating over the next 5–10 years.
> John and I are fully responsible for the decisions leading up to it.
What are the two of you doing to show accountability? Are you slashing your own future stock grants, cutting your own salaries, diluting your positions with stock grants to everyone else? What's the consequence for this decision on your end that shows you're accountable for what happened, not just responsible for it? Since you have no intention of cashing out, the valuation cut is ineffectual as a consequence to you, and the support/severance package will probably have minimal impact on your own bottom line since it's all largely been accounted for (payouts of planned bonuses, existing unvested stock etc)