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Flexport will lay off 20% of the company starting Friday, leaked memo says

businessinsider.com

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Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#51

Post by throw0101c »

hef19898 wrote: post #5

Burried in Petersons mail is one nugget every B2B start-up needs to take to heart: >> It's clear that our customers want us to be a profitable company they can rely on to solve important problems in their supply chain. An endless stream of VC money allowing you to sell dollars for dimes does not achieve that. Also, I had a feeling that Flexport might run into problems one day, when Softbank invested, Softbank being s…

> An endless stream of VC money allowing you to sell dollars for dimes does not achieve that.

It depends on who your customers are: if you're consumer-facing then perhaps an acquisition (with or without an IPO first) is just fine as you may be rolled into other product offerings.

Also, if consumer-facing, clones may pop up (even open source), so if you go broke then folks can perhaps transition somewhere else.

Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#52

Post by strangesmells02 »

guappa wrote: post #43
strangesmells02 wrote: post #39

Theyve been advertising theyre hiring on HN for years lol

I used to work at a startup that kept hiring people until it got shutdown. One person worked there for 2 weeks before getting fired. Another hadn't even started yet. I knew it was going down but since they were still hiring I thought I had all the time in the world to find something else.

Crazy how much money these companies have to just be able to keep hiring and hiring then just cut 20% suddenly.

Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#53

Post by rchaud »

hef19898 wrote: post #5

Burried in Petersons mail is one nugget every B2B start-up needs to take to heart: >> It's clear that our customers want us to be a profitable company they can rely on to solve important problems in their supply chain. An endless stream of VC money allowing you to sell dollars for dimes does not achieve that. Also, I had a feeling that Flexport might run into problems one day, when Softbank invested, Softbank being s…

> aim being the next Schenker, Kühne & Nagel, XPO... instead of being the "global trade disruting tech thing"

But that's the entire game. Being "tech-only" is attractive due to the magical thinking that drives its valuations, particularly in stodgy, capital-intensive industries like logistics and real estate (WeWork).

Companies like Schenker have tens of thousands of employees too, some unionized and some not. Startup companies aren't equipped to handle things like organized labour strikes.

Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#54

Post by rchaud »

martypitt wrote: post #3

> With more than $1 billion in net cash, following this change, Flexport is now in a great position to take advantage of the opportunities in front of us to return to profitability as soon as the end of next year. This feels like a tone-deaf statement to make in an email laying off 1 in 5 of your company. "We're letting you go, but look how much cash we have!"

The messaging is purely for stodgy industry customers that might perceive Flexport as yet another hire-and-fire Silicon Valley disruption fever dream.

Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#55

Post by matdehaast »

michaelt wrote: post #46
matdehaast wrote: post #16

Earlier quoted context omitted.

To be fired in the latest layoff a few weeks later.... Not sure what you want them to do?

Often established businesses that find themselves in a precarious financial situation will announce a hiring freeze several months before resorting to layoffs. It's a much easier decision than laying people off, and much easier to reverse, so it can be taken a lot earlier. And you'll get a modest but relatively painless reduction in headcount due to attrition, if the rest of the job market is buoyant. It also means,…

AFAIK there was a hiring freeze mandate from the board and the previous CEO ignored this. Hence was fired...

The new CEO had to rectify the situation. Its a horrible situation but at the end of the day, it was going to happen

Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#56

Post by local_crmdgeon »

guappa wrote: post #43
strangesmells02 wrote: post #39

Theyve been advertising theyre hiring on HN for years lol

I used to work at a startup that kept hiring people until it got shutdown. One person worked there for 2 weeks before getting fired. Another hadn't even started yet. I knew it was going down but since they were still hiring I thought I had all the time in the world to find something else.

I worked somewhere that hired a new Head of Eng, who moved there FROM INDIA, to lay her and 2/3rds of the company off the next day.

Was insane.

Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#57

Post by ChainOfFools »

Closi wrote: post #29
braza wrote: post #8

Earlier quoted context omitted.

> Also, I had a feeling that Flexport might run into problems one day, when Softbank invested, Softbank being such a harbinger of problems its only saving grace is setting Saudi money on fire. Also also, Flexport is the most impressive comoany coming out of YC if you ask me. All they have to do, is to aim being the next Schenker, Kühne & Nagel, XPO... instead of being the "global trade disruting tech thing" and they'…

I think this is an interesting point - I work in supply chain and commonly when tendering companies will say things like: "We have been profitable for 20 years straight" Being profitable in SCM is a sales point, being unprofitable is a risk.

I have a close non-business connection to a reasonably large Intermodal carrier that serves the rails and the ports in the northeast US, and featured very prominently on their website page header is the number of years that they have been in continuous operation.

Fluffy promises of service or growth or expansion are either completely absent from their corporate Identity material or buried on second and third tier links away from the simple and straightforward proof that they have quite literally delivered, for the past two plus decades.

Re: Flexport will lay off 20% of the company starting Friday, leaked memo says

#58

Post by bagels »

itsoktocry wrote: post #40
jacquesm wrote: post #19

Earlier quoted context omitted.

It cares because: running out of cash is a bad idea for any company and running leaner says that you will have more runway. Whether or not it will be enough runway as perceived by that very same stockmarket will determine your share price. If there are no buyers for your stock the price will drop like a stone, so this is both a message to current shareholders 'don't sell, we'll make it' and potential buyers 'sellers…

> It cares because: running out of cash is a bad idea for any company and running leaner says that you will have more runway. They are a private company, they have no relation to "the stock market". Maybe "Wall Street"?

Right, I really mean investors and customers, sorry.
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