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Spotify reducing employee base by about 6%

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Re: Spotify reducing employee base by about 6%

#291

Post by andsoitis »

MAGZine wrote: post #163
gfdsgfsdgfs wrote: post #115

Earlier quoted context omitted.

Unions often have coasters and quiet quitters. As an experienced developer I would never work with people like that.

you'd rather work harder and for less money than work with people who phone it in? I don't really buy the meritocracy argument that 'good devs get paid more'. It hasn't really panned out in my experience, except for less than 1%, probably closer to .1% of devs who are really, truly exceptional AND will fight aggressively for their keep.

I don’t want to work with people who consistently let me down nor would I want to work with jerks.

Re: Spotify reducing employee base by about 6%

#292

Post by steviesands »

shadowtree wrote: post #280

The core question is how many employees do you need run a stable internet business? Stable means no massive new product lines, growth, etc. Spotify is what it is. An app across a handful platforms, streaming infrastructure, and a legal/purchasing dept for music rights. Does this need 7000 people? Zero chance. Is it 1000? 700? 250? No ones knows yet, but everyone remembers WhatsApp at acquisition and watches Twitter t…

If your goal is maintenance mode for the company, milk profits for 10 years, and to be eventually replaced by competitors then I think you can run a company very slim. The other question would be, if you have captured a large market share (100s of M/yr to Billions in revenue), how many employees do you need to prevent an upstart from overtaking you through improved tech, product, or strategy?

For example, if FB never invested in ML they would have had even larger margins (fewer GPUs and ML engineers), but now that investment may pay off by fending off tiktok through copycat products and also rebuilding ad attribution after ATT. To complicate matters, before it happens, you don't know in what area your competitor will arise (ML? Product? Paradigm shift?). Similar examples with Google vs. OpenAI, ~2010s Kubernetes wars between cloud providers, Snap vs. FB/Twitter, etc.

Re: Spotify reducing employee base by about 6%

#293

Post by whstl »

cgio wrote: post #279
shmatt wrote: post #156

Earlier quoted context omitted.

It's very naive to think these huge orgs don't have dead weight which is much bigger than 6%. If you start figuring some of your moonshot ideas aren't hitting their OKR's, you have a few options: * Just let them keep doing whatever without delivering what they claim they can * Create new moonshots for them just because * Move them to other products, but that doesn't mean they'll create more value as an org with (now)…

As I mature in this industry I find it hard to agree, even though I draw my experience from organisations outside the FAANG if it’s still a thing. Dead weight, is in my experience no more than 2%, where I qualify dead weight as someone who cannot add value or is actively detrimental. Most people can add more value than they currently do. Many more people do not match their capacity, but that is mostly out of bad allo…

I agree. But IME the number of "dead weight" varies heavily depending on some factors. I've definitely seen teams with >10% dead weight, because of a combo of bad hiring process, coupled with management not caring to check on them. Of course that might be a biased view: in the cases I know, the managers couldn't manage to get them back to speed, but those were managers that had failed on the hiring/day-to-day already.

Re: Spotify reducing employee base by about 6%

#294

Post by andsoitis »

hsavit1 wrote: post #273

Another "I take full accountability for the moves that got us here today." message from the CEO. What does this accountability mean? Shouldn't he be fired and stripped of all benefits, just as he did for those employees that got axed?

> What does this accountability mean?

It means to own up to one’s mistake and fixing it. It isn’t that mysterious.

Re: Spotify reducing employee base by about 6%

#295

Post by pc86 »

thehappypm wrote: post #223
phamilton4 wrote: post #197

Earlier quoted context omitted.

Understand 2x, I was also looking across all the jobs at spotify. There are some that go as low as 70k salary, a majority seem to be 170k+. It was just for ease of calculation. even if we take 500k that's still 0.033% of revenue -_-

Again, revenue is not really all that relevant for this kind of business. They’re a low margin business because they must pay huge bills to record labels. R&D doesn’t cut record label costs.

I'm having trouble understanding why 'revenue is not really all that relevant.'

If you're burning $40M a year, and you press a button to save $90M a year, yes your label costs are the same but how are you not now at +$50M a year?

Re: Spotify reducing employee base by about 6%

#296

Post by matwood »

kypro wrote: post #124
nrook wrote: post #95

The tide is turning; tech owners are attempting to curtail the high costs of labor in the software industry. The only way for labor to fight back is to stand together and form a union.

I don't want to sound unsympathetic, but a lot of these companies massively over hired over the last couple of years. While others were losing their jobs during the pandemic tech employees were in higher demand than ever. In fact, I'd argue the demand for tech workers has been so high over the last couple of years that a lot of people who really shouldn't have got a job based on their experience were able to do so. I…

It's a meme at this point that Google is probably developing 5 new chat apps to replace the 10 they recently killed. But then everyone gets up in arms when Google trims it's workforce by 6%, one which as grown by 100+% since 2016. If everyone wasn't looking for anything to signal 'recession!', no one would bat an eye at these big tech companies doing small staffing course corrections.

Re: Spotify reducing employee base by about 6%

#297

Post by MontyCarloHall »

shadowtree wrote: post #280

The core question is how many employees do you need run a stable internet business? Stable means no massive new product lines, growth, etc. Spotify is what it is. An app across a handful platforms, streaming infrastructure, and a legal/purchasing dept for music rights. Does this need 7000 people? Zero chance. Is it 1000? 700? 250? No ones knows yet, but everyone remembers WhatsApp at acquisition and watches Twitter t…

>legal/purchasing dept for music rights

I would imagine this is where the majority of their staff are. Spotify’s catalog is huge, and record labels are constantly renegotiating extremely granular contracts with the streaming services (i.e. at the individual song level). For example, I’ve seen particular songs on albums disappear for a few weeks (the rest of the album can still be played), then mysteriously return (or not), all because of some cryptic licensing shift from the record label. There is no easy way to automate this; a human interaction must occur between the label and streaming service every time a weird licensing shift causes a particular song/album/artist to be removed. Given the size of Spotify’s catalog, there are probably thousands of such licensing changes each day.

Re: Spotify reducing employee base by about 6%

#298

Post by pc86 »

WastingMyTime89 wrote: post #193
CydeWeys wrote: post #172

Earlier quoted context omitted.

2X is my understanding as well. Whatever you think an employee costs based on TC, double it to get the rough cost to the employer. Some other big employer costs related to employees you forgot include employment taxes, hardware/software expenses and licenses, and office space and related perks. Also I suspect that $150k as the mean TC of those being let go is low. Spotify might be saving up to $500k all-in per employ…

> Also I suspect that $150k as the mean TC of those being let go is low. Probably not low. It's an enormous salary for a developer outside of the Valley and Spotify has plenty of employees which are not in the USA.

I applied for an "entry-level" EM role with Spotify in 2021 and the base was 260-275, plus a generous bonus target and stock. TC would have been pushing $400k, for a fully remote USCAN-based role. I say that strictly as a calibration point - it's unlikely engineers are pushing half a million (maybe at the Staff+ level) but there's also not likely any engineers before $150k TC. I'd expect even mid-levels to be in the $200-225 ballpark but could be wrong.

I think $150k median is probably on the lower side of correct, but not enough to meaningfully impact any of the numbers anyone is discussing here. It's close enough.

Re: Spotify reducing employee base by about 6%

#299

Post by shadowtree »

steviesands wrote: post #292
shadowtree wrote: post #280

The core question is how many employees do you need run a stable internet business? Stable means no massive new product lines, growth, etc. Spotify is what it is. An app across a handful platforms, streaming infrastructure, and a legal/purchasing dept for music rights. Does this need 7000 people? Zero chance. Is it 1000? 700? 250? No ones knows yet, but everyone remembers WhatsApp at acquisition and watches Twitter t…

If your goal is maintenance mode for the company, milk profits for 10 years, and to be eventually replaced by competitors then I think you can run a company very slim. The other question would be, if you have captured a large market share (100s of M/yr to Billions in revenue), how many employees do you need to prevent an upstart from overtaking you through improved tech, product, or strategy? For example, if FB never…

If you compete with startups with tens of employees - shouldn't you use tens of employees to counter their strategies too?

Do you need endless hanger ons in HR, PR, all kinds of non-producing departments?

Crappy CEOs, which is not the same as a crappy founder, have grown companies without any sense and purpose. Daniel is a great founder and rode great luck. But, he should have been replaced with a Eric Schmidt operator figure a while ago.

I think the founder clings to company forever is coming to an end, in most cases going public should mean a new CEO.

Re: Spotify reducing employee base by about 6%

#300

Post by isitmadeofglass »

phamilton4 wrote: post #127

I get needing to keep a company lean and that businesses operate to make money... But most of these recent layoffs really make me feel uneasy. Spotify is a little different because AFAIK they are still operating at a negative net income, but still let's take a look at this. They're going to let go 600 people.. that's maybe an annual 90 million in savings (150k salary). The company's revenue is about 9 billion with -3…

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