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Twitch.tv Lays of 400 Employees

blog.twitch.tv

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Re: Twitch.tv Lays of 400 Employees

#181

Post by jefozabuss »

dusted wrote: post #175
ryandrake wrote: post #58

> Like many companies, our business has been impacted by the current macroeconomic environment, and user and revenue growth has not kept pace with our expectations. In order to run our business sustainably, we’ve made the very difficult decision to shrink the size of our workforce. Let's just take a moment to admire this paragraph. > "our business has been impacted by the current macroeconomic environment" There's th…

I'm impressed that they even needed 400 people to run it in the first place ?

There is a lot going on the back-end of these big streaming sites and also they have "support over 25 languages, in order to provide 24/7/365" so I'd guess it's in the thousand+ range.

Re: Twitch.tv Lays of 400 Employees

#182

Post by vineyardmike »

ryanSrich wrote: post #55
mdavidn wrote: post #5

Earlier quoted context omitted.

The "macroeconomic environment" is the evaporation of available VC funding because higher interest rates provide more lucrative investments elsewhere.

Huh? LPs don’t put money into a VC fund for 4% returns that they can get on bonds. They do it mostly out of diversification. Usually looking for 10-100x. Why would that change?

Bonds are essentially the "free" rate of return. Assuming you trust the government, there's no reason to earn anything less. That means that everything needs to return something above the bond rate. That goes for debt too, why would you write a riskier loan to someone at a lower rate than the government?

LPs looking to put their money somewhere (or many somewheres) will reconsider as rates change. It might not be "vc or bond" but it will cause every part of the financial system to re-calibrate. Maybe a rich person takes out debt against their assets to invest in a VC fund in 2020, but now that the rates rose and stock values fell, the interest rate on that (or comparable) debt is too expensive. For example, Elon's loans for twitter range from 6% to 11%, and would likely be higher if written today.

TLDR Interest rates don't need to compare 1:1 to a VC fund's returns to have an affect on the decision by LPs to invest in it.

Re: Twitch.tv Lays of 400 Employees

#183

Post by vineyardmike »

vuln wrote: post #44
this_user wrote: post #32

Earlier quoted context omitted.

All of that is a direct consequence of low interest rates. If money is cheap and easy to borrow, there is less pressure on a business like Uber to turn an actual profit. Instead, investors will encourage them to grow aggressively in the hopes of capturing the market. Once liquidity dries up, there will be more pressure to actually make money. But the economy is working as intended and it's actors are merely reacting…

> Once liquidity dries up, there will be more pressure to actually make money. No. They IPO and the investors get their money while retail investors hold the bag of poop thinking they just got _in_ on something.

It's not 100% retail investors, and whoever owns it today surely wants money. I don't know Uber's actual finances, but as long as you make enough money every month to cover last month's bills, you don't need to make a profit.

There are a lot of games that can be played with money to keep a company unprofitable but alive and healthy for a while. Look at amazon, a famously "unprofitable" company for almost 2 decades.

Re: Twitch.tv Lays of 400 Employees

#184

Post by Ekaros »

sokoloff wrote: post #92
pcurve wrote: post #71

Earlier quoted context omitted.

How does the fed rates impact game streaming revenue? Were they not profitable?

Same way Google and Facebook are hit by the reduction in advertising spend. Twitch is, from a business perspective, an advertising company. The streaming is a means to that end, just as search or social media is for Google and Facebook.

And their other side is discretionary spending. Probably of the lowest order as many are likely to pick other discretionary things over donations to streamers. How many will pick donating to streamer instead buying maybe a cheeseburger or some other treat...

Re: Twitch.tv Lays of 400 Employees

#185

Post by yunohn »

camhart wrote: post #154
ilyt wrote: post #101

Earlier quoted context omitted.

Or, the investors want their returns. If you don't understand how perfectly healthy business can be gutted just because investors want better number on next year's sheets and don't care about long term then don't post.

I just want to say, investors getting returns should be a goal of every for profit company (whos taken investor $$). Thats why investors risk their capital. That capital is responsible for the growth of most major tech companies. Its responsible for most jobs at tech companies. Not saying this is an excuse to treat employees poorly. They're just as vital as the capital (employee hours is often quite literally whats b…

Having money should not be worth more than doing the work. Same goes for landlords.

Re: Twitch.tv Lays of 400 Employees

#186

Post by yunohn »

lanza wrote: post #89
ryandrake wrote: post #58

> Like many companies, our business has been impacted by the current macroeconomic environment, and user and revenue growth has not kept pace with our expectations. In order to run our business sustainably, we’ve made the very difficult decision to shrink the size of our workforce. Let's just take a moment to admire this paragraph. > "our business has been impacted by the current macroeconomic environment" There's th…

> Wait, I thought revenue was growing! How is that not sustainable? If you just leave costs where they are and let revenue grow, you are by definition sustaining/growing the bottom line. Come on man, if you don't understand how a business can be showing signs of unhealthiness while still increasing revenue then don't post. That's such a trivial superficial analysis of reality. I'm not going to pretend to know or unde…

> revenue go up faster

CEO takes responsibility by cashing out massive bonuses.

> revenue go up slower

CEO “takes responsibility” by firing others.

Are you good-faith questioning why the HN crowd is justifiably upset over the current state of things?

Re: Twitch.tv Lays of 400 Employees

#188

Post by amitrip »

lanza wrote: post #89
ryandrake wrote: post #58

> Like many companies, our business has been impacted by the current macroeconomic environment, and user and revenue growth has not kept pace with our expectations. In order to run our business sustainably, we’ve made the very difficult decision to shrink the size of our workforce. Let's just take a moment to admire this paragraph. > "our business has been impacted by the current macroeconomic environment" There's th…

> Wait, I thought revenue was growing! How is that not sustainable? If you just leave costs where they are and let revenue grow, you are by definition sustaining/growing the bottom line. Come on man, if you don't understand how a business can be showing signs of unhealthiness while still increasing revenue then don't post. That's such a trivial superficial analysis of reality. I'm not going to pretend to know or unde…

is it though?

Re: Twitch.tv Lays of 400 Employees

#189

Post by Rastonbury »

gtirloni wrote: post #3

> Like many companies, our business has been impacted by the current macroeconomic environment I must be living under a rock because, outside big tech self-inflicted wounds, I don't know what they are talking about. Is it Ukraine? SVB? Chinese housing market?

Advertising, which is how twitch makes money, look at GOOG, FB, Snap revenues, companies are bracing for a recession so have dialed back ad budgets. Enterprise tech spend and consulting/professional services budgets are also being put on hold, it's not the whole economy but the slowdown is clear and obvious in these industries

Re: Twitch.tv Lays of 400 Employees

#190

Post by shapefrog »

yunohn wrote: post #186
lanza wrote: post #89

Earlier quoted context omitted.

> Wait, I thought revenue was growing! How is that not sustainable? If you just leave costs where they are and let revenue grow, you are by definition sustaining/growing the bottom line. Come on man, if you don't understand how a business can be showing signs of unhealthiness while still increasing revenue then don't post. That's such a trivial superficial analysis of reality. I'm not going to pretend to know or unde…

> revenue go up faster CEO takes responsibility by cashing out massive bonuses. > revenue go up slower CEO “takes responsibility” by firing others. Are you good-faith questioning why the HN crowd is justifiably upset over the current state of things?

CEO gets paid massive bonus for “taking responsibility” and firing others.
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