Live data from Hacker News

Musk’s inner circle worked through weekend to cement Twitter layoff plans

washingtonpost.com

301–310 of 852 posts

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#301
post #19

Twitter now owes about $1 billlion in debit payments per year. Cash flow last year $630 million. I think 25% staff reductions is just a starting point.

Your number might be something other than cash flow. IIRC Twitter has net negative cash flow and about $4B in existing long term debt prior to the new debt financing of the acquisition.

The debt financing burden is a further burden on Musk: twitter generates no free cash flow. Musk has to pay the creditors, and his co-investors are not likely to put in more cash. Musk and every other investor bought-in to a deal that now would be valued at about half what they paid. Depending on how the debt is secured, this also means twice the percentage of the company's value is now encumbered by that debt. That means that if Twitter were sold today the equity investors could lose nearly their entire investment.

Even a lousy LBO would be of a company you can asset-strip to reduce the debt. What could Twitter sell? The financing really does not make sense.

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#302
post #160

Not sure what Musk's intentions are with this. Normally this will lead to the best people updating their resumes and switching over to less toxic places ASAP. You are left with people who are attached to their ancient code or who can't find good jobs elsewhere. edit: typoz

> Normally this will lead to the best people updating their resumes and switching over to less toxic places ASAP

Potentially, but not necessarily. Some high performers may reasonably think "finally someone who is going to cut through all the bullshit in this bloated company and demand some accountability". Look through some of the stories when Steve Jobs rejoined Apple; it wasn't that dissimilar.

Now, that said, folks like this usually want and demand an inspiring leader. Some may think Musk fits the bill for that (I think I probably would have years ago), but these days I usually just want him to STFU with so much of the bullshit nonsense he sends out. I mean, the day after he closed the Twitter deal he tweeted a blatantly ridiculous and libelous story about Paul Pelosi - it's just more of the same stupid shit from him.

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#303
post #291

Earlier quoted context omitted.

Are you disagreeing that layoffs are happening at twitter? Elon told investors it would happen, and he needs to increase profit by $1.5B to stop losing money. Layoffs are guaranteed. The question is will it be 25% as reported or 75% as Elon promised. The answer is we can’t know because nobody knows. It’ll probably something in between.

What investors? The company is being delisted in one week.

The investors in the acquisition? A company doesn't need to be listed on an exchange to have investors.

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#304
post #235

Earlier quoted context omitted.

As an example to further illustrate your point, it is possible for a business to purchase key employee insurance. As an employee we do not have the same privilege.

It's just a nitpick and it doesn't impact GP's point all that much, but: surely employees in the US have some sort of job loss insurance - if not standalone, then attached to a mortgage or life insurance?

It's usually unemployment insurance and it's provided by the state (literally, it'll be the state the employee resides in - here's California's: https://edd.ca.gov ).

There ARE "insurance" products that will "defer your credit/mortgage payments in case of a job loss" - they are almost all universally some form of scam (or at least a very bad "insurance").

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#305

> Another person familiar with the deal who spoke on the condition of anonymity to discuss sensitive matters last week said the total number of layoffs is likely to be closer to 50 percent. Unless I’m missing something, the only sources for this article are a mix of speculation and anonymous sources who can’t even agree with each other about the layoff.

This is how high quality journalism works.

There's actually quite an involved skill to reading and fully understanding this kind of writing - and it's infuriatingly difficult to pick up that skill (I've been developing it by spending time talking to professional journalists, but I'm still not there yet).

When you read "another person familiar with the deal who spoke on the condition of anonymity to discuss sensitive matters", you need to translate it to something more like the following:

The journalist who wrote this has found a credible source, who has insider knowledge.

That source has requested anonymity, and the journalist finds that request credible.

The journalist then used their skills and experience in writing about this area over the course of their career to evaluate if that source was trustworthy. They also considered if the source had their own motivations which could affect what information they chose to share and why.

The journalist may have then cross-checked that information against other sources of information to help evaluate its credibility. This becomes more important the more high stakes the claim in question becomes.

An editor (and potentially even separate fact checkers) evaluated the statement as well, and applied judgement as to whether it held up firmly enough to be published.

There are so many phrases like this in top-tier journalism. When an experienced journalist reads an article from someone else that says "a senior official in the administration said..." they can often narrow that down to just a dozen or so potential people, based on their knowledge of that beat.

As a non-journalist reading newspapers this is pretty infuriating, because there's this whole language that you need to know about in order to fully understand what's being communicated here.

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#306

Earlier quoted context omitted.

Depends on the role, the company, and the timing. A single worker in an important position leaving on the spot, dropping some critical work half-way done and taking all the context and specific knowledge with them, could easily torpedo a million dollar deal. Or, a single employee leaving could trigger a cascade, and soon you're short a whole project team. In general , I'd say at-will still favors employers, who are i…

I'll note that a company that depends on a single employee like this has failed to plan and is already in trouble. No matter how well you treat them, your critical employees will leave. You might be able to pay them well enough to limit the risk on them taking another job (though few employers do) but even with that sooner or later they'll win the lottery, get hit by a bus, or just retire. A business can and must hed…

As GP said, sometimes, there is a cascade effect. One employee quits, and the whole team follows. Sometimes going to a competitor.

In tech, it is relatively easy for an employee to hedge against getting fired. It is a well paid job, in high demand.

It is not the same if the company fires its janitors, but I don't think I will stay in a literally filthy company that fires its janitors.

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#307
post #253

6 months ago it was all painted (maybe seemingly, though, by prior executives who weren't speaking for Musk) as if this wouldn't be a big deal for employees, which to me makes this idea that people are being rapidly fired "for cause" after a suddenly-imposed weekend work shift deadline extra shitty :/. (Even if I do sometimes claim that Twitter is incompetent as an organization or bloated with idle staff, these are h…

Those being laid off for cause are the 3 senior level executives (the old CEO, the lead counsel, and the content policy head). Those 3 had a 100+ million cumulative severance package which they are now no longer eligible to receive, although none of them are strapped for cash.

> they are now no longer eligible to receive

Musk doesn't meet the cause outlined in their employment contracts. They'll get their executive early termination severance but it'll require some legal action first.

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#308

Earlier quoted context omitted.

I see a ton of signs saying help wanted in frot of businesses.

Anecdotally, any business with a sign in their front window is not a business which can replace a full time job, let alone employment by Twitter.

I've seen signs for commercial truck drivers around town in front windows, starting $80k and "local deliveries only".

For certain types of jobs it's still the most effective method out there.

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#309
post #296

Earlier quoted context omitted.

maybe performance of Twitter, not the particular employees?

That's called a layoff.

Layoffs can be more expensive than terminating for cause. https://www.reuters.com/business/tesla-sued-by-former-employ...

Re: Musk’s inner circle worked through weekend to cement Twitter layoff plans

#310
post #17

Earlier quoted context omitted.

How is it legal to demand people work on weekends? How is it legal to (even threaten) firing if a new assigned task that takes a long time is not done on time?

I the US your manager can demand the moon be sitting on his desk by Monday morning, or you are fired. I think this is a reality check and a power play by Musk to remind employees of the fact.

I mean that would be begging for the "pantsless on the desk" method of quitting, but I get the point.
Post reply on HN