The bull case is that he sacrificed Twitter capital in exchange for political capital, which I think is pretty sound. But that doesn't really apply to most CEOs running most businesses.

All feels on my part just to hopefully add to the dialogue. Nothing scientific here.

He reduced the headcount to roughly what it was in 2017. At the time of the acquisition, many of the employees were in non technical roles, contributing nothing of value, posting videos about their empty work day on TikTok. Jack Dorsey admitted that he made a mistake by over hiring - more than doubled the headcount from 2017 to 2021.

https://www.statista.com/statistics/272140/employees-of-twit...

If the perceived value has anything to do with Elon Musk’s politics then that becomes irrelevant under new ownership.

I don’t think there are any real new competitors. Blue Sky is a joke. Ultra niche platform for weirdos. No economic value there.

It brings you back to that old HN saw "why do these companies need so many people to do that?" Maybe the answer actually was they didn't/don't.

this seems a gross misunderstanding of how software companies work at scale. Twitter doesn't hire engineers to run a monitoring system cause they need it to stay alive (there are alternatives to building and running their own!), they chose to do it to save money or increase revenue.

Twitter doesn't need an ad network, they can use Google, or build their own and take more profit. They might know that for every 3 engineers they hire on their ad network, they increase their click rate and thus revenue.

The same can be said for any infra team. You don't need to build much infra, but companies do it because sometimes it's a way to save hundreds of millions of dollars in cloud costs or licensing fees.

I'm disputing the claim that the above statement was ever in question. FAANG doesn't employ people because they mistakenly thought they needed that many, they do it because adding more employees has either lowered their infra costs or increased their revenue.

I really believe the layoffs were not about needing less people, it was about gaining some ground in the employee/employer dynamic.

There are always low performers. Periodically transitioning out the bottom 10% or so, and rehiring different people, possibly in a different departmental distribution, is always net beneficial to the company.

Using regional/national/global events as the explanation is always better than blaming yourself.

Bad for people in the short term, of course. Arguments are made that it's good for society in the longer term. Wars are fought between opposing sides of that opinion. :)

I just don’t understand how it’s possible. I admit I was one of the skeptics predicting Twitter’s immediate demise after laying off so many. Everywhere I have ever worked had at least 3X more work to do than staff to do it. You can’t get rid of even one person without feeling the pain. I just can’t fathom working for a company that can get rid of so many people and not struggle! My current company wouldn’t be able to even keep the lights on in the offices if it lost 80% of its staff.

It's worth remembering Twitter was a buggy mess before Elon bought it. Sure it's still a buggy mess today, but the staffing costs are dramatically lower.

Losing a ton of money was something Twitter was also pretty good at even before Elon too - only profitable 2 years out of the 8 leading up to the acquisition while it was still a public company etc.

Elon's actions were a clear signal to the industry and investors that it's time to "fight back" and show the labor market who's really in charge.

Basically, the ownership class was pissy that some people were able to actually get away from exchanging time for money.

The overstaffing problem was painfully obvious at many of the companies I spoke too as a consultant during that time. They'd have bizarre situations where they'd have dozens of product managers, project managers, program managers, UX designers, and every other title but barely a handful of engineers. It was just a big gridlock of managers holding meetings all day.

One friend resigned from Twitter prior to anything Elon related, specifically citing the fact that it paid well but it was impossible to get anything done. Not all of Twitter was like this, but he was outside of engineering where he was one of scores of people with his same title all competing to work on tiny features for the site or app.

The pendulum seems to be swinging to the other direction, where companies are trying to do too much with too few people. I still see a lot of growing (or shrinking) pains where companies are cutting in the wrong places, like laying off engineers to the point of having more people with {product,project,program}-manager titles combined than engineers. I hope we settle out somewhere more reasonable soon.

For those of us who have been around the block (i.e., are old), the only times I've personally seen companies aggressively cut personnel is during economic shocks (dotcom bubble and housing crisis as two examples) and only then were the companies running lean (I wouldn't even say they were running bare bones; it's the only time I've seen headcount actually optimized for the work being produced).

I think the Twitter purge was actually an example of a major trigger. Not on par with the previous two I mentioned (obviously), but it was so high profile that anyone in tech took note of it, which is why I made the original comment. I've never seen so much discussion around a layoff for a company that was not imminently imploding (some may say Twitter was about to implode, but if you said that at the time I think you were wrong regardless of the state of its financials).

But I’m confused by Twitter being an example because:

1. Twitter went private so we don’t really know how well or poorly the business did after making the massive cuts

2. The little information we do have indicates that advertising revenue significantly declined after the acquisition

Since Twitter financials are private we can only speculate, but my best guess would be that Elon took a bloated, unprofitable business and turned into a lean, unprofitable business, which doesn’t seem all that impressive to me.

What about this story warrants it being dragged out into every conversation about businesses cutting bloat, I cannot understand. People seemed genuinely amazed that Twitter was able to keep the site online without ever acknowledging what an absurdly low bar this is. Like I can light money on fire and keep a site online too; it’s the making money part that is the tricky bit.

That said, the trotting out was just to point out the coincident timing between when Elon started the cuts, and how aggressively he cut, and when other mega cap tech started slowing or even laying off workers. You might say "but none of those other companies clipped 80% of their folks," but that would be somewhat suicidal to do as a public company. But a high-profile trigger like that influences folks to take a harder look at how and why they're deploying personnel.

Last comment, when you heard what Elon was doing were you just like "wow, that's a lot of layoffs" and then went about your day? Or did it reinforce your view that "there is tons of bloat at tech companies..."? Do you really think the leaders at these companies are ignorant about that reality and that your opinion is unique? No offense, but I don't. They knew they were bloated. To steal another commenter's metaphor, there's all this overstaffing in the air, a combustible vapor of sorts. And Elon's reduction at Twitter lit a match.

I just don’t understand why it would be. It’s an example you can’t learn anything from (since the company is private). But even if Twitter were still public, all the variables are confounded with the fact that the CEO is also a chaos agent, political operator, and potentially insane.

Sorry if my comment came off as attacking your post. I think your observation of the effect the Twitter cuts had on others is probably right. I am more criticizing the unscientific thinking of the people that claim to have taken a lesson from Elon’s management of Twitter.

- site stays up and has sufficient ability to recover from outages

- can still deploy features in the frontend

- can't deploy features in the backend (look closely; mind you, Old Twitter absolutely sucked at product innovation too)

- moderation deliberately cut down

- due to some combination of increased unpleasantness, boycotts, and the personal brand toxicity of Elon, the advertising revenue is down

- site was levered into an unofficial US cabinet position (!), we have yet to see how lucrative that is. Maybe it includes a free jet.

I would think Twitter is profitable with the cuts that were made it is just not nearly profitable enough to justify the investment.

Non-negative cash flow from operations but lighting money on fire when you add on the debt that was used to purchase the company.