Stripe laying off around 14% of workforce • Hacker News Board

Re: Stripe laying off around 14% of workforce

#141

Post by sanjayio » Thu, Nov 03, 2022, 2:21 PM UTC

sdrinf wrote: post #105

tempsy wrote: post #36

I feel bad for employees that have waited a decade to cash out. No reason why Stripe couldn’t have gone public in 2020-2021 at a huge valuation but from past interviews it sounds like the decision to remain private was just a founder preference thing because “focus” or something. Now the IPO market is completely frozen and its valuation is likely cut in half from peak, at least.

The second they go public it triggers a 6-12 months window after which all of their employees can cash out. This will, inexorably lead to an exodus of their most senior peeps, and when it happens, will probably be ground zero for the next gen of fintech startups. Delaying going IPO this way, amongst other things, is about retention.

This is a problem that people are well aware of, it’s mitigated with stock refreshers. It’s not perfect but helps retention.

Re: Stripe laying off around 14% of workforce

#142

Post by sharkweek » Thu, Nov 03, 2022, 2:22 PM UTC

ericb wrote: post #128

pmoriarty wrote: post #75

Earlier quoted context omitted.

There are rarely if ever any serious consequences to top execs screwing up wealthy companies. 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.

What did they screw up, though? Their psychic abilities failed? A coin flip came up tails but they bet on heads?

Yes, essentially.

“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

Re: Stripe laying off around 14% of workforce

#143

Post by saos » Thu, Nov 03, 2022, 2:22 PM UTC

> we’re very sorry to be taking this step and John and I are fully responsible for the decisions leading up to it.

Fair enough but this seems to be common line every CEO is going for the two years.

The severance Stripe are offering is nice though.

Re: Stripe laying off around 14% of workforce

#144

Post by spamizbad » Thu, Nov 03, 2022, 2:23 PM UTC

mbreese wrote: post #133

BaseballPhysics wrote: post #64

Earlier quoted context omitted.

That first point is key, and I think they're being... less than honest. The reality is there's very little evidence for an actual "broader slowdown". GDP growth in the US was decent in the last quarter despite a huge decline in home sales and headwinds from inflation, and unemployment remains at record lows. There's certainly some signs for concern, but the only real, persistent decline has been in the stock market (…

> The reality is there's very little evidence for an actual "broader slowdown". GDP growth in the US was decent in the last quarter despite a huge decline in home sales and headwinds from inflation, and unemployment remains at record lows. I thinks as a payment processor, they are in a better position than most to predict sales trends. This effect might be restricted to their segment of the market. But if the payment…

Stripe’s reach as a processor probably isn’t broad enough to see those kinds of trends. Their processing fees are quite high so there’s huge industry sectors that will just never touch them.

Re: Stripe laying off around 14% of workforce

#145

Post by tempsy » Thu, Nov 03, 2022, 2:23 PM UTC

throw3823423 wrote: post #140

tempsy wrote: post #36

I feel bad for employees that have waited a decade to cash out. No reason why Stripe couldn’t have gone public in 2020-2021 at a huge valuation but from past interviews it sounds like the decision to remain private was just a founder preference thing because “focus” or something. Now the IPO market is completely frozen and its valuation is likely cut in half from peak, at least.

For anyone that has been there anywhere near a decade, there's been opportunities to cash out partially, at very good valuations. You'll see that a vast majority of early employees have departed, and they didn't do that by giving away their early options, or getting crushed by AMT by exercising without liquidity. While it might have been nicer to IPO by now, early employees are doing extremely well.

sure that’s true of most unicorns. early employees are a tiny fraction of the workforce waiting to cash out.

Re: Stripe laying off around 14% of workforce

#146

Post by gunapologist99 » Thu, Nov 03, 2022, 2:24 PM UTC

eganist wrote: post #47

Hey pc, if you're around: > 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? Sinc…

Why are any of those things necessary? Are those people unable to get other jobs or go launch their own startup (putting that massive severance package to good use)?

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.

Re: Stripe laying off around 14% of workforce

#147

Post by czbond » Thu, Nov 03, 2022, 2:24 PM UTC

eganist wrote: post #47

Hey pc, if you're around: > 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? Sinc…

Ya know.... Founders and CEO's are responsible every day. They created the business for people to have jobs, they have to deal with it when the business cannot support the jobs. When things in the macro economy change, sometimes the business can't operate at the same level it was before.

People like to 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.

Re: Stripe laying off around 14% of workforce

#148

Post by esel2k » Thu, Nov 03, 2022, 2:25 PM UTC

nsxwolf wrote: post #130

memish wrote: post #90

Earlier quoted context omitted.

That's in the email: 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 re…

The last time I got laid off, my severance was basically enough to buy a bus ticket to the unemployment office. What they're doing here is incredible. (Almost felt compelled to name names here but took a breath)

As a European the severance for a large company doesn’t sound all to different to what I am used to. Normally you have 3 months by contract plus some add a month per year tenure. Healthcare costs, career support etc is normal for larger/successful companies. Then certain countries (not the company) will pay 80percent of your salary for 2 years to find a new job.

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.

Re: Stripe laying off around 14% of workforce

#149

Post by tempsy » Thu, Nov 03, 2022, 2:26 PM UTC

nscalf wrote: post #135

tempsy wrote: post #114

Earlier quoted context omitted.

I don’t think this is correct. Then your theory is that every tech company that went public in last 2 years have experienced a brain drain that Stripe has not. Lock up periods aren’t set in stone. They probably didn’t need to raise money and could have done a direct listing and let employees cash out immediately.

There’s also no lack of buyers for stripe on secondary markets.

whether you can sell on secondary markets is restricted by the company. pretty sure Stripe has not let most employees sell on secondary markets. personally have not seen them solicited on Forge or EquityZen myself.

Re: Stripe laying off around 14% of workforce

#150

Post by Barrin92 » Thu, Nov 03, 2022, 2:28 PM UTC

ericb wrote: post #128

pmoriarty wrote: post #75

Earlier quoted context omitted.

There are rarely if ever any serious consequences to top execs screwing up wealthy companies. 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.

What did they screw up, though? Their psychic abilities failed? A coin flip came up tails but they bet on heads?

preparing for an eventual end to the free money rally instead of over-hiring isn't exactly something I'd consider to fall into the realm of psychic abilities.

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.