Dropbox announces 20% global workforce reduction • Hacker News Board

Re: Dropbox announces 20% global workforce reduction

#201

Post by Ekaros » Wed, Oct 30, 2024, 2:26 PM UTC

krisoft wrote: post #167

recroad wrote: post #44

TIL that nobody knows what they're doing. Jokes aside, how do you end up having more than 500 excess people than what you need? What is management exactly doing during the time they went from 1 excess person to 500? Did they just hope the "macroeconomic headwinds" would become tailwinds? Didn't they at some point see that they have more people than valuable work, and maybe we should deal with that problem instead of…

> What is management exactly doing during the time they went from 1 excess person to 500? It is usually not the case that these people are standing around and doing nothing. It is more that they are working on initiatives and projects which the company is discontinuing now. When the company has a lot of money investors expect them to spend some of it in finding new directions and opportunities. It's not all just spen…

Sometimes I think that tech world has been after "growth" for too long. Instead accepting that at some point companies are reasonably mature. After which they can do more incremental development with lot less head count growth.

Re: Dropbox announces 20% global workforce reduction

#202

Post by ramraj07 » Wed, Oct 30, 2024, 2:27 PM UTC

BossingAround wrote: post #57

absoluteunit1 wrote: post #29

The severance package is great! I don’t think I would be upset (unless I was extremely passionate about a project I was working on)

Really? 16 weeks of salary, or 4 months of pay. In my country, you get 3 months of pay as standard when you're fired from your job. Doesn't seem that great to me to be honest.

US salaries are quite a lot more; lifestyle creep is a thing but at least for developers they get paid a lot more than the average worker in the US than say in the Europe. Factoring that, 4 months is amazing.

Re: Dropbox announces 20% global workforce reduction

#203

Post by onlyrealcuzzo » Wed, Oct 30, 2024, 2:27 PM UTC

insane_dreamer wrote: post #177

golly_ned wrote: post #172

This is a great severance plan. 1. 4 months pay + 1 week per year of tenure. 2. Receive Q4 vests. 3. Upcoming approved leaves paid in cash. 4. Year-end bonuses paid. 5. Keep company devices.

You know what's better than a great severance plan? Keeping your job.

Not necessarily.

If you're actually good at your job, you typically end up with an even better job: https://hbr.org/2018/10/research-when-getting-fired-is-good-...

Re: Dropbox announces 20% global workforce reduction

#204

Post by mateus1 » Wed, Oct 30, 2024, 2:27 PM UTC

krisoft wrote: post #167

recroad wrote: post #44

TIL that nobody knows what they're doing. Jokes aside, how do you end up having more than 500 excess people than what you need? What is management exactly doing during the time they went from 1 excess person to 500? Did they just hope the "macroeconomic headwinds" would become tailwinds? Didn't they at some point see that they have more people than valuable work, and maybe we should deal with that problem instead of…

> What is management exactly doing during the time they went from 1 excess person to 500? It is usually not the case that these people are standing around and doing nothing. It is more that they are working on initiatives and projects which the company is discontinuing now. When the company has a lot of money investors expect them to spend some of it in finding new directions and opportunities. It's not all just spen…

That’s such a naive take. For the past 5 years at least these layoffs are not about particular projects being discontinued or even improving the bottom line. This is about how people are expendable and their priority is investors.

Re: Dropbox announces 20% global workforce reduction

#205

Post by oldpersonintx » Wed, Oct 30, 2024, 2:27 PM UTC

tyingq wrote: post #157

throwaway313373 wrote: post #109

Earlier quoted context omitted.

I mean, imagine that you are leading a team of 4 people. Are you sure that you will always be able to accurately tell if you need a fifth person or not? Or you have a team of 5 people. Can you tell if you have a one too many?

Maybe not. But typically natural attrition rates would let a hiring freeze take care of most of this. Layoffs are kind of normal current day, but a 20% layoff is not.

[dead]

Re: Dropbox announces 20% global workforce reduction

#206

Post by ramraj07 » Wed, Oct 30, 2024, 2:28 PM UTC

elric wrote: post #90

I'm always a bit confused by profitable companies with (presumably) large reserves laying off lots of people. I get that they want to remain profitable. But sure 500ish people could be put to some use? A new product, a new market, a spinoff. Whatever? Are you telling me that no one in such a big, wealthy company of clever engineers has any use for a bunch of talented people?

Often they target the lowest performers for such layoff. Of course they rarely succeed in doing that, but the idea is that these people should have been let go anyway but weren’t for various reasons.

Re: Dropbox announces 20% global workforce reduction

#207

Post by insane_dreamer » Wed, Oct 30, 2024, 2:28 PM UTC

throwaway2037 wrote: post #164

insane_dreamer wrote: post #71

[flagged]

> Meanwhile the S&P500 is up _23%_ this year As the saying goes: "The stock market is not the economy." Most of that gain can be attributed to six stocks. Dropbox is down about 6% year-to-date.

Fair point. Let's look at profits then. Net profit margin across the S&P500 is 12%, a YOY increase.

Re: Dropbox announces 20% global workforce reduction

#208

Post by andygcook » Wed, Oct 30, 2024, 2:28 PM UTC

For context, Drew Houston's total compensation for the year in 2023 was $1.5M:

> According to our data, Dropbox, Inc. ... paid its CEO total annual compensation worth US$1.5m over the year to December 2023. That's a notable increase of 34% on last year

via https://finance.yahoo.com/news/heres-why-dropbox-inc-nasdaq-...

Even if Drew took minimum wage, that would save ~15 jobs assuming $100K all-in comp (which seems low to me for a tech salary). 500 employees is more like $50M/year, and probably more.

Of course, Drew Houston's net worth is ~$2B and he could technically loan Dropbox Inc money personally to save the jobs, my guess is a lot of his net worth is actually Dropbox stock that he would have to liquidate and would affect the stock price materially. He would also need to follow insider trading laws too and can't just up and sell vast amounts of stock on a whim. Most executives are on pre-approved schedules to sell any stock to avoid triggering insider trading.

The severance package Dropbox is offering is pretty good - 16 weeks of pay + an additional week for each year of tenure, impacted employees get their Q4 equity vest & prorated bonuses, everyone keeps company devices, an offer for extra time + help for people on visas, and job placement help for everyone.

Dropbox is a public company that is profitable, but not really growing through their flagship product. No growth is more or less bad on Wall Street. They also haven't really had a major hit since their initial file-sharing product and missed some shots they probably should have hit (mainly vs. Notion with Dropbox Paper, Mailbox acquisition, etc). With many systems moving away from "files" and to "cloud objects" like Figma, Notion, etc, their workhorse product might be going away over time too. They need the time and focus to find that next S-growth curve.

Layoffs suck and no one wants to do it, but sometimes it's needed to save the ship.

Re: Dropbox announces 20% global workforce reduction

#209

Post by [deleted] » Wed, Oct 30, 2024, 2:30 PM UTC

realusername wrote: post #35

yieldcrv wrote: post #14

Earlier quoted context omitted.

how would you like the next CEO to handle it, for reference?

A 20% layoff means either the market changed very very quickly or something went terribly wrong in the company strategy. Here it's the second scenario and I'd expect the CEO to be on shaky grounds after such bad results. There needs to be more explanation on where the CEO screwed up that badly and the consequences for the management.

[deleted]

Re: Dropbox announces 20% global workforce reduction

#210

Post by wg0 » Wed, Oct 30, 2024, 2:30 PM UTC

Not sure if it is relevant but after firing 500 people, the stock price is almost up by 2 dollars between 29th and and 30th October.

Next - we have to raise our prices.

Probably lazy money invested for gains takes its toll on the rest of the society.