Restructuring Announcement • Hacker News Board

Re: Restructuring Announcement

#191

Post by halfcat » Thu, Apr 03, 2025, 1:08 PM UTC

nilamo wrote: post #159

nostrademons wrote: post #135

Earlier quoted context omitted.

The issue was interest rates. Money was free in Feb 2022; the interest rate was literally 0%, and so any cash-generating investment at all is profitable. Fed started raising rates in Apr 2022, at which point leaders started freaking out because they know what higher rates mean, and by Jun 2022 the Fed was raising them in 0.75% increments, which was unheard of in modern economics. By Jan 2023 the rate was 4.5%, which…

Why does the interest rate matter? Unless you have no cash on hand and are operating soley off debt??

> Unless you have no cash on hand and are operating soley off debt??

Bingo

Re: Restructuring Announcement

#192

Post by copypasterepeat » Thu, Apr 03, 2025, 1:41 PM UTC

alvah wrote: post #112

paradox460 wrote: post #100

Earlier quoted context omitted.

This will continue until there are actual consequences for those responsible. I'm of the mindset that any time a company does layoffs, they should start from the top And work down.

>I'm of the mindset that any time a company does layoffs, they should start from the top And work down. Oh, to be young and idealistic again! So in your world, the people running the business should fire themselves first?

An honest question: why is this being downvoted? I thought that downvoting is meant to be used when someone is trolling or bringing the level of discussion down, not when you simply disagree with someone's point. I mean sure, it's stated a bit sarcastically, but my gosh if we're going to downvote every sarcastic comment, that would include a good portion of HN comments.

Re: Restructuring Announcement

#193

Post by pclmulqdq » Thu, Apr 03, 2025, 1:52 PM UTC

diggan wrote: post #186

pclmulqdq wrote: post #181

Earlier quoted context omitted.

How did they "ruin" a company if that company made money?

Not all humans are driven by the same motivations.

Presumably if you as a founder are not driven by a desire to make money and your investors are, you 100% should be ousted. This is the principal-agent problem at work.

Re: Restructuring Announcement

#194

Post by wavemode » Thu, Apr 03, 2025, 1:53 PM UTC

rs186 wrote: post #109

dangrossman wrote: post #44

Earlier quoted context omitted.

From Reddit discussions, if they can be trusted, there is nobody who can remove Matt from any position. It's a private company and the investors were given non-voting shares.

I am confused -- so if investors don't like the CEO, there is nothing they can do? Other than maybe taking their part of the money out?

Even "taking their part of the money out" is not guaranteed. Again, it's a privately traded company, so there's no open market. You have to find someone willing to buy your shares from you and make a deal with them.

Re: Restructuring Announcement

#195

Post by 1shooner » Thu, Apr 03, 2025, 1:53 PM UTC

chris_wot wrote: post #116

1shooner wrote: post #37

Earlier quoted context omitted.

Another interpretation would be a common cause for both this and the litigation, i.e. pressure to improve financials.

That's an unbelievably terrible course of action. If you have financial issues, don't try to get out of it by litigation. Only litigate if you absolutely have to, and you have been wronged. Don't do it because you are trying to improve your bottom line.

Yes, i think that's the consensus. But it didn't start with litigation, it started with a 'creative' approach to generating new licensing revenue.

Re: Restructuring Announcement

#196

Post by alxjrvs » Thu, Apr 03, 2025, 1:54 PM UTC

alvah wrote: post #112

paradox460 wrote: post #100

Earlier quoted context omitted.

This will continue until there are actual consequences for those responsible. I'm of the mindset that any time a company does layoffs, they should start from the top And work down.

>I'm of the mindset that any time a company does layoffs, they should start from the top And work down. Oh, to be young and idealistic again! So in your world, the people running the business should fire themselves first?

Imagine the organization you are imagining in your head.

Now imagine there is a Super-boss, who is exactly like the "people running the business" (attribution needed), but one level above them.

If the Super Boss were to look at the situation, I think it'd be pretty obvious that the issue would be "The people organizing the company at the highest level" who are responsible for the failures of the company. That may involve over-hiring, which is itself a bad practice that causes unnecessary pain and (personal, financial) suffering, and would be a good cause to fire them for almost crashing my beautiful super-company that I, the Super-boss, super-founded.

You're saying that if we return the Super-boss to the realm of the fictional, then suddenly it isn't the C-suite's fault anymore?

If we're discussing should, then yeah, their heads should be the first to roll. I agree its idealistic to imagine them having the sort of decency this requires, but I agree it should be the case!

Re: Restructuring Announcement

#197

Post by InsideOutSanta » Thu, Apr 03, 2025, 2:01 PM UTC

alvah wrote: post #185

InsideOutSanta wrote: post #175

Earlier quoted context omitted.

If they have to fire people, they're running it poorly, so yes?

If you've spent any time in business at all, you know it's always the tea lady who gets fired first and the managers last. Many commenters here seem to live in some kind of fantasy world.

>the people running the business should fire themselves first?

You were questioning whether they should, not whether they will. That's what people are responding to. They understand perfectly well who will get fired first.

Re: Restructuring Announcement

#198

Post by mathattack » Thu, Apr 03, 2025, 2:23 PM UTC

IG_Semmelweiss wrote: post #129

nostrademons wrote: post #104

Earlier quoted context omitted.

Yeah. I was made a manager in Feb 2022 with 5 directs and 9 headcount to fill. Hired 5, and then by June 2022 all remaining headcount was cut. In January 2023 we had our first-ever layoffs in the company's 25-year history.

It is so hard to fathom that a leader trusted with millions of dollars of other people's money can be so disengaged from recruiting as to not see a hard wall of cash crunch, months if not years ahead. You can't assume fundraising will always go swimmingly. You have to always be in survival mode, and if that means not hiring aggressively, then you put on the breaks until the money comes in . Either as a leader you are…

I’ve seen many companies have this problem. They base hiring against planned revenue instead of current revenue. In a sense you have to - if you’re planning on growing 100% for several years on the back of new products and a big sales team you must hire in advance. It’s what the VC model is founded on. The downside is when you miss the revenue, you have to cut deep. And it’s usually worse because your hiring standards dropped in hyper growth.

Re: Restructuring Announcement

#199

Post by diggan » Thu, Apr 03, 2025, 2:24 PM UTC

pclmulqdq wrote: post #193

diggan wrote: post #186

Earlier quoted context omitted.

Not all humans are driven by the same motivations.

Presumably if you as a founder are not driven by a desire to make money and your investors are, you 100% should be ousted. This is the principal-agent problem at work.

> Presumably if you as a founder are not driven by a desire to make money and your investors are, you 100% should be ousted

Presumably, the real world is a bit more nuanced than that.

There is no reason why you cannot run a company for different motivations than "get as rich as possible" while still accepting investments from people whose sole motivation is "get as rich as possible". While difficult, it is possible to align people even when they have different motivations.

Re: Restructuring Announcement

#200

Post by tasuki » Thu, Apr 03, 2025, 2:27 PM UTC

paradox460 wrote: post #100

pityJuke wrote: post #89

Earlier quoted context omitted.

How infuriating for anyone recently hired caught in this trap. It seems to me the obvious, from both a business & human perspective, is to stop hiring at first signs of trouble, before layoffs. To do so otherwise is cruel. I doubt Matt had zero idea about this possibility two months ago.

This will continue until there are actual consequences for those responsible. I'm of the mindset that any time a company does layoffs, they should start from the top And work down.

> I'm of the mindset that any time a company does layoffs, they should start from the top And work down.

I'm off the mindset that employment should be voluntary: both by the employer and the employee. It makes employers reluctant to hire if they know they can't get rid of people again.

(I'm a socialist at heart and think it'd be pretty nice for the government to take care of people who lost their jobs. Just tax the companies a little more!)