[HN Gopher] Discord is laying off 17 percent of employees
___________________________________________________________________
Discord is laying off 17 percent of employees
Author : minimaxir
Score : 394 points
Date : 2024-01-11 18:37 UTC (4 hours ago)
(HTM) web link (www.theverge.com)
(TXT) w3m dump (www.theverge.com)
| paxys wrote:
| Layoff season is becoming an annual thing in tech, isn't it?
| saos wrote:
| There's always an annual layoff. Media just perpetuating it...
| dragontamer wrote:
| 30%+ at Twitch, 17% at Discord, huge numbers at Google
| (anyone have a % from Google yet?)
|
| There's definitely more layoffs this year than usual. There's
| always layoffs, but the size / scope of them are not
| traditionally this big.
| xen0 wrote:
| Google are being shy with the numbers. Confirmed
| 'hundreds'; probably very low thousands? Maybe 1%?
| slekker wrote:
| layoffs.fyi says 1000
| tunesmith wrote:
| I get a "ripping the bandaid off" sense of it. Like for a
| lot of them the assumption is "okay, this is the rest of
| it, and then we are reset to the new normal". No idea
| whether that assumption is correct, but it seems the
| mentality is more that than "oh crap, batten down the
| hatches, another storm is coming".
| squigz wrote:
| > Like for a lot of them the assumption is "okay, this is
| the rest of it, and then we are reset to the new normal".
|
| Not to say this is universal, but I read a comment here
| on HN just earlier that said their company said this last
| year... then did the exact same thing this year.
| Ancalagon wrote:
| Mine did the same
| baq wrote:
| Companies lay people off. The 2010s were very unusual.
| ZIRP and other kinds of free money are addicting.
| Groxx wrote:
| Lots of social and casual-entertainment companies hired a
| ton for the pandemic "nobody goes outside" surge too. Some
| of this (and the last year or two) is simply shedding
| unsustainable increases as everyone gets a better idea of
| what changes have _actually_ occurred and will stick
| around.
|
| Whether that's a 5% increase or a 500% increase in amount-
| laid-off though, no idea. And I do worry that the increased
| media attention will simply make these _easier_ to pull off
| unjustly, as people get more and more used to seeing it
| happen.
| tsunamifury wrote:
| The google layoff was in the Hundreds... i.e. what they do
| normally every year anyway silently. It's just being played
| up for investors.
| saos wrote:
| Aren't these companies who historically try and avoid
| layoffs? To me is them changing their stance.
| aaomidi wrote:
| Google did not do layoffs like the one last year really ever
| before last year.
| paxys wrote:
| How many people did Google lay off annually in January before
| 2023?
| swingingFlyFish wrote:
| No these sets off layoffs are way different than before.
| jimbob45 wrote:
| Really need the government to start heavily penalizing
| companies who lay people off. Layoffs can't be a tool for a
| company to get ahead financially. We're ruining lives and
| triggering suicides with these layoffs.
| symlinkk wrote:
| That would slow down hiring.
| Sohcahtoa82 wrote:
| Maybe that's a good thing?
|
| Companies need to stop defining growth in terms of head
| count and instead in terms of revenue and profit and learn
| that just because you have access to money doesn't mean you
| should go on a hiring frenzy.
| r053bud wrote:
| The government is totally disinterested in penalizing
| companies for this. How else will it keep a healthy well-
| supplied reserve army of labour?
| peter_l_downs wrote:
| How would this work? Would companies be unable to fire people
| except for rule violations?
| anotherhue wrote:
| No fault layoff == 50% salary severance would help align
| incentives.
| flavius29663 wrote:
| maybe don't allow them to hire any visa employee for the
| next x years? That would make them much more careful with
| layoffs.
| estebank wrote:
| There are already restrictions on visa and employer
| sponsored green card applications for 6 months after a
| layoff, iirc.
| flavius29663 wrote:
| should extend to H1b, J class visas and others, and for
| longer than 6 months, maybe 2 years. Give other companies
| a chance of getting those people, htey just proved they
| cannot manage them properly.
| yladiz wrote:
| It's not exactly related to the parent, but in many parts
| of Europe, yeah, you can't just fire someone after the
| probation period, and the firing needs to be for cause
| (which is genuinely a high bar to cross).
|
| To the point of the parent, in a lot of Europe it's not so
| simple to just lay off some small portion of the company.
| It needs to be justified and a decent percentage, and
| employees are often entitled to some compensation (some
| severance) to offset the layoff.
| yreg wrote:
| Yeah, obviously depends from country to country, but for
| a layoff the company often has to be in some problems.
| It's difficult to do a layoff when you have record
| profits.
|
| Of course there are other ways to fire employees but
| those have their own rules.
| yladiz wrote:
| Right. My point is that the company can't just say "we're
| not doing well, we need to get rid of a few people" and
| do a layoff with impunity. They have to lay off a pretty
| decent amount of people (in some cases like 30%) and they
| need to pay severance to the laid off employees. In most
| of Europe it's basically a tool of last resort besides
| going bankrupt, unlike in the states where it's easier
| and done somewhat regularly.
| Scarblac wrote:
| Simple, only allow them after top management takes a heavy
| decrease in compensation.
| pwb25 wrote:
| if you have millions in cash why would you ever fire
| someone except that?
| kbd wrote:
| More government is not the solution to all problems.
| davidw wrote:
| Or, instead of the government dictating those kinds of
| company decisions, put in place a system so that you're ok if
| you do get laid off, like a real health care system that is
| not linked to your place of employment.
| Barrin92 wrote:
| >put in place a system so that you're ok if you do get laid
| off
|
| the being laid off part itself takes a huge mental toll,
| regardless of material circumstances. There's a reason the
| mental health of phd candidates and a good chunk of white
| collar workers in nominally lucrative professions is in the
| gutter. The hire and fire hamster wheel is in itself
| completely pathological. The industry just has done a
| really fantastic job of marketing permanent insecurity and
| precarity as individual choice.
| fwip wrote:
| Sure, but the threat of losing your house, and the
| ability to feed, clothe, and care for your family, is
| also a pretty big stressor.
| HammadB wrote:
| I don't think its the role of the government to penalize
| layoffs. If a company needs to do a layoff to remain viable
| it must be allowed to - the downside (everyone loses their
| job) is worse. And trying to apply some mechanism where the
| government decides if its ok or not seems too intractable.
|
| I think the approach of things like the WARN (https://en.wiki
| pedia.org/wiki/Worker_Adjustment_and_Retraini...) act are
| more plausible. Use legislation to make the workforce more
| informed, resilient and ahead-of layoffs. You don't want mass
| layoffs crippling your economy because people are unable to
| plan.
|
| It's a direct consequence of the WARN act that most tech
| layoffs have extremely generous severance.
| wombatpm wrote:
| So should companies be prohibited from doing stock buybacks
| or paying dividends for some period of time if they do a
| layoff. Or should they be required to rehire laid off
| workers before doing any new hiring? When it's truly about
| maintaining company viability, I have some sympathy for the
| corporate position. But companies reporting increasing or
| record profits AND doing layoffs smells of financial
| engineering and socializing costs while privatizing
| profits.
| mathiasgredal wrote:
| Why not just tax stock buybacks the same or higher than
| regular profits? This would force companies to either
| increase R&D/CAPEX spending or lower prices.
| tonystubblebine wrote:
| Isn't it net good that tech companies regularly overhire?
| I'd be afraid that too much regulation would end up
| making companies hesitant to hire in the first place. And
| why are we asking companies to act as charities here.
| That's so against their nature. Tax them instead and have
| government improve the safety net.
| Madmallard wrote:
| That's because it is. It is degenerate inhumane latestage
| capitalism garbage.
| lorstic wrote:
| > If a company needs to do a layoff to remain viable it
| must be allowed to
|
| What makes you think that's why most of these tech
| companies are laying people off?
| EA-3167 wrote:
| There's already a known way to combat these sorts of
| things... they're called unions. Tech jobs will be a lot more
| stable and bearable when more people understand that, and
| that we aren't all embarrassed millionaires.
| paxys wrote:
| The question we really need to ask is - why are people driven
| to bankruptcy and suicide because of their employment
| situation? Why can't everyone have a cushion so they aren't
| reliant on their next paycheck to have food and shelter? Why
| can't everyone have healthcare? Why can't we have reasonable
| vacations, sabbaticals, maternity/paternity leaves? _These_
| are the issues government should be solving. And when they
| do, companies should happily lay off as many people as they
| want as frequently as they want.
| milanvrekic wrote:
| That severance package is quite generous. "Why can't
| everyone have a cusshion" = because someone has to pay for
| it.
| paxys wrote:
| Not everyone is getting laid off from Google. Most people
| are handed their last paycheck and shown the door.
|
| As for "someone has to pay for it", well we already are.
| We have the highest per capita healthcare spending in the
| world, also the highest rate of medical-related
| bankruptcies in the world and lowest life expectancy in
| the developed world. We are putting 6-12% of our paycheck
| into social security and will likely never see a payout
| when we need it. Different industrial sectors are getting
| hundreds of billions in subsidies. The military is
| getting trillions.
|
| The money is there, we just need to have the will to
| spend it to everyone's benefit. But no, we'd rather set
| it on fire instead so the wrong people don't accidentally
| get helped.
| fwip wrote:
| The rich man points at the destitute man's donation cup,
| and tells the poor man, "Look! That guy's stealing your
| money!"
| rqtwteye wrote:
| I don't think penalizing will work. I think government
| shouldn't constantly inflate bubbles where companies have way
| too much investment money so they constantly overhire until
| the shit hits the fan. It would have been better to slowly
| more away from the low interest rates over the last decade.
| rchaud wrote:
| It's shareholder capitalism. On one hand, you get stock
| options in your comp that might be worth a lot. On the other,
| you could get booted if it means that the company's earnings
| per share beats Wall St estimates.
| 29athrowaway wrote:
| Rank and yank
|
| https://en.m.wikipedia.org/wiki/Vitality_curve
|
| 1. Rank everyone
|
| 2. Layoff bottom 10% or so
|
| 3. Reward the top
|
| 4. Keep it secret or the workforce will adapt by hiring bad
| people and sabotaging good people
|
| Used at most companies with performance evaluations. Taught at
| MBA schools.
|
| Trivia: MBAs have accomplished nothing throughout human
| history. Only creating overpaid executives that avoid taxes,
| corrupt the government, ruin the environment, make people poor,
| sick and make other countries richer. If all MBAs retired
| tomorrow 90% of obesity, pollution and corruption would stop.
| eli wrote:
| Just about all companies have performance evaluations. This
| is not an explicit tactic in most companies.
| 29athrowaway wrote:
| It is.
|
| Because of bad math and pseudoscience.
| dartos wrote:
| If it's a tactic in a company, at some level it is
| explicit.
|
| Someone makes the choice.
| ok_dad wrote:
| Performance evaluations are not evaluating your
| performance, the evaluations are the performance.
| "Performance" evaluations. They're intended to be a method
| to easily fire people in a litigious world.
| Scoundreller wrote:
| Yeah, manager's duty is to always find something that
| could be improved.
|
| Same with interviews: gotta keep things qualitative lest
| someone sues you for not being the successful candidate.
| candiddevmike wrote:
| This isn't an eval. It's typically "you need X poor
| performers, Y average performers, and Z top performers.
| Can't fit your folks into these buckets? Too bad!"
| ska wrote:
| > Used at most companies with performance evaluations.
|
| I suspect this is not true. Evals are far more common that
| stacking.
|
| Btw when you do do this, 4 pretty much never works, and
| generate a political layer around it.
|
| Perversely, at the group level it raises the value of lower
| performers, mostly as "chips".
| lightbendover wrote:
| [at a FAANG] Just the other day my director chastised his
| directs for "letting low performers leave without getting
| fired," which is something I had yet to hear get
| broadcasted to a full room of people. The company's leaders
| would rather get credit for a URA target than do what's
| best for the company (in this case, not paying out
| severance). Tech is so polluted with this kind of thinking
| that I really can't wait to leave it.
|
| After surviving what feels like a dozen rounds of layoffs
| over the past year, morale is already non-existent. You can
| go weeks and sometimes months without even hearing a peep
| from the people you once thought were the brightest and
| hardest working. The whole thing just feels in need of a
| reboot. Is this consistent across all companies at the
| moment or is it just time for me to leave?
| fragmede wrote:
| URA = unwanted attention rate
| dv_dt wrote:
| The company that first applied that strategy, GE, ran
| themselves into all sorts of problems with that approach.
| Microsoft's era of doing fairly poorly was also at a
| timeframe when they were doing rank and cut strongly.
| aaomidi wrote:
| Yep, and these rankings are less about performance and more
| about politics. You actually have a very high chance of
| getting an organization made out of talkers and not-doers.
| FireBeyond wrote:
| That's putting it mildly, re GE. When both Fortune and WSJ
| ("hardly bastions of anti-corporate sentiment", with
| apologies to _The Insider_) are criticizing your approach
| and leadership style, then you have an issue.
|
| Not to mention Jack Welch's very "Let Them Eat Cake"
| attitude to the middle and working classes and executive
| compensation.
| candiddevmike wrote:
| Stack ranking people has got to be one of the most soul
| crushing tasks imaginable. You don't know what if any of the
| bottom will be cut.
| lostlogin wrote:
| > Stack ranking people has got to be one of the most soul
| crushing tasks imaginable.
|
| So don't play a part in it. Is doing it more or less
| crushing than being sacked?
| Scoundreller wrote:
| At least the stack rankers will be able to "prove" they
| provide value every year by way of creating stacks.
|
| Sucks to be on any team that delivers cyclical/lumpy value
| (with arbitrary windowing/snapshots).
| paxys wrote:
| You are talking about stack ranking. While yes, it does
| happen, the outcome of it isn't dictated in a single "x%
| people are now fired" event. There are multiple rounds of
| performance reviews, employees at the bottom are identified,
| they go through PIPs or some other similar process, and it
| may eventually lead to their firing or resignation. What we
| are seeing right now isn't that.
| FireBeyond wrote:
| > There are multiple rounds of performance reviews,
| employees at the bottom are identified, they go through
| PIPs
|
| I think this is a little hand-wavy. I bet the number of
| people identified for PIPs by stack ranking who survive the
| process is likely to be in the low single digit percentage,
| if that.
| compiler-guy wrote:
| Neither this round of layoffs at Google nor the last had any
| association with performance as far as anyone can tell.
|
| Strong performers from the teams around have been laid off,
| and people who really need to be gone have not.
| UncleMeat wrote:
| Ratings aren't even finalized at Google for another week to
| be used for a layoff decision.
| htrp wrote:
| There are always rankings....
| UncleMeat wrote:
| Using last year's grad ratings as the input for this when
| this year's ratings will be final in literally a week
| seems ludicrous.
| PartiallyTyped wrote:
| > 4. Keep it secret or the workforce will adapt by hiring bad
| people and sabotaging good people
|
| AWS isn't even hiding it anymore ...
| ProllyInfamous wrote:
| Many sub-contractors right now are "naming their own prices" --
| but from my POV (as a construction consultant, retired
| electrician) being a residential GC right now would have been "a
| tough christmas bonus."
|
| Hoping things swing better, but everything is in cycles. I
| definitely do NOT believe that AI has NOTHING to do with this
| (double-negative)...
| ttymck wrote:
| What?
| ProllyInfamous wrote:
| I'm providing perspective from non-IT/CS career (residential
| construction), which is booming for smaller trades (but not
| as a whole).
|
| Being a homebuilder right now would not be enviable (because
| it is too expensive to build/buy right now).
| ttymck wrote:
| I see, thanks for clarifying! Your mention of AI, is that
| with respect to residential construction or tech layoffs?
| ProllyInfamous wrote:
| I know few people that haven't used ChatGPT (or similar
| LLM), both technical and construction -types. Even fewer
| follow-up with "it is useless" (except initial users),
| unless their ego is clearly the motivation (e.g. lawyers,
| accountants, top-brass). i aM SO teH sMArTeST
|
| #A.I'mReplaceable
|
| As for AI in construction: I trained IBEW in commercial
| spaces, and have seen video footage of basic device
| layout being directed by a mobile bot (which follows
| blueprints and marks walls accordingly). I think oldwork
| construction is much safer than newwork, as far as AI-
| directed replacements are concerned.
| rvz wrote:
| Like I said before and as predicted [0], its not over yet for the
| layoffs.
|
| More layoffs to come as the tech industry begins to correct
| further. Especially VC funded startups.
|
| [0] https://news.ycombinator.com/item?id=37924095
| ren_engineer wrote:
| the Silicon valley of the last 15 years was a 0% interest rate
| phenomenon, going to take a long time for normalcy to return
| after a decade of distortion to organic market forces
| sf_rob wrote:
| Also these companies are reaching financial maturity. It's
| going to be the next generation of companies to be
| trendy/fun/excessive IMO.
| groceryheist wrote:
| Yes. It is time for laid off seniors to take these exit
| packages and incubate the next generation. Be ready to draw
| financing when rates fall in Q3 of 2024.
| baq wrote:
| Don't be so sure about that... rates will fall sharply in a
| recession, otherwise inflation will run hot (see today's
| print!) Rates market prices in the average outcome, but the
| distribution isn't uniform nor Gaussian.
| chickenpotpie wrote:
| > Don't be so sure about that... rates will fall sharply
| in a recession, otherwise inflation will run hot
|
| What? Lowering interest rates raises inflation.
|
| > See today's print
|
| Can you link? Not sure what your talking about
| groceryheist wrote:
| Official USA inflation numbers ticked up slightly in
| December.
| alfalfasprout wrote:
| mostly driven by housing which has a 12 month lag and has
| dropped significantly in the last 6 months.
| tuckerconnelly wrote:
| How does 0% interest rate actually affect this though? Are that
| many companies actually funded on debt now? Or are are sales
| down because their customers were purchasing with debt?
| zooq_ai wrote:
| It's a knock on effect. Most software companies sell to other
| software companies and VC funded startups
| ketzo wrote:
| Fair question, but there's a pretty direct line.
|
| ZIRP means that huge capital managers (sovereign wealth
| funds, pension funds, 401k managers, etc.) get very, very
| little money on the super-safe stuff they like to buy.
|
| They need to make returns somehow, so if a VC is promising
| them 15% returns, that sounds quite promising compared to
| T-Bonds that return 1.5%!
|
| But over the last two years, the yield on super-safe
| investments now looks more like 6, 7, 8, 9%. That makes a
| high-risk investment like VC much less attractive, by
| comparison.
|
| If VC is less attractive, less capital flows to their funds;
| smaller VC funds means much more discerning, stingy startup
| investment.
| Ekaros wrote:
| You can get debt cheap to fund investment. Other side is that
| lot of money is always searching for some kind of return.
| With rates going up that money can go back to boring bonds,
| either from governments or even big reliable companies that
| are unlikely going anywhere.
|
| No need to gamble it anymore on tech companies.
| ojbyrne wrote:
| Companies evaluate ROI for projects against the "risk-free"
| interest rate. When that interest rate rises, fewer projects
| are viable.
| mempko wrote:
| What do you mean by 'organic market forces'? All interest rates
| are decided on, from what we have now to 0%. All markets are
| designed, with rules, regulations, and tax laws.
|
| Markets are a technology, they don't come from nature. Markets
| are an intentional product of governments. Anthropologists
| haven't found a single stateless society that voluntarily chose
| markets.
| rchaud wrote:
| 0% financing and you're making losses year after year after
| year? Maybe it's time to return the money to the shareholders
| instead of playing musical chairs as the S.S. ZIRP sinks.
| neom wrote:
| For any HR folks kicking around HN: When thinking about lay-off
| at this scale of business, how do y'all go about navigating the
| WARN act? Do you just mitigate it with longer than 60-day layoff
| compensation?
| bluetidepro wrote:
| Have been wondering this, too.
| grumple wrote:
| Not an HR folk, but from what I've seen they often just offer
| at least 60 days of severance and benefits.
| codingdave wrote:
| There are quite a few exceptions that can be used. They are
| listed on Wikipedia:
| https://en.wikipedia.org/wiki/Worker_Adjustment_and_Retraini...
|
| IANAL, nor am I HR, but I have to imagine that if a company
| wanted to avoid the WARN act, those exceptions would give them
| creative ways to structure the layoffs to avoid it.
| mikeryan wrote:
| Unless you legitimately fall under those exceptions it's
| generally viewed as best not try to skirt the WARN act you'll
| end up with a bunch of lawsuits to defend and pretty harsh
| penalties if you lose (back pay up to the time of the award
| plus the severance and legal fees)
| hn_throwaway_99 wrote:
| If necessary, nearly all companies will give at least 60 days
| severance in lieu of notice.
|
| More to the point, though, in this particular example I'm not
| even sure federal WARN notice requirements apply here - there
| are lots of loopholes people don't often understand. See
| https://www.schneiderwallace.com/practice-areas/employment/w...
| - looking at those bullets:
|
| * "Layoffs of 500 or more workers at a single site or
| location." - doesn't apply, was only 170 employees
|
| * "Layoffs of 50 or more workers when those layoffs comprise
| 33% of the total full-time workers at the location" - my guess
| is that doesn't apply either, as the 170 workers were spread
| throughout the company
|
| * "Layoffs of 50 or more workers when closing a building or
| facility, or the layoffs include the discontinuation of an
| entire operating unit" - Again, I believe these discord layoffs
| were broad-based and not the result of entirely closing a
| single business unit.
| eli wrote:
| California has its own WARN Act with less lenient rules
| UncleOxidant wrote:
| > If necessary, nearly all companies will give at least 60
| days severance in lieu of notice.
|
| They don't call it severance - it's just regular pay for 60
| days. Technically they're still employed by the company. At
| the end of that 60 day period when the employment is
| terminated, that's when severance (if there is any) is paid.
| whstl wrote:
| This is often called "garden leave".
| UncleOxidant wrote:
| My wife was working for a bank until August of last year. One
| day in late August they called a meeting and told the whole
| department that while they were still employees for the next 60
| days they could no longer come into the office and actually
| work. That's how they got around the WARN act - they didn't
| have to file the WARN report until that 60 days was up. I guess
| that kind of makes sense for a bank: if you give people a 60
| days heads up that layoffs are coming that could result in
| potential mayhem.
| rqtwteye wrote:
| "if you give people a 60 days heads up that layoffs are
| coming that could result in potential mayhem."
|
| Does this mayhem actually ever happen or is it paranoia? I
| have seen several layoffs where people got advance warning of
| a few weeks up to almost a year. I have never seen people do
| anything bad once they got told they would be laid off.
| paxys wrote:
| Of course it happens. If you tell people they are going to
| be fired in 60 days, in the best case they will stop
| putting in any effort, in the worst case they will actively
| sabotage others or steal company data and property. Just
| making them stay at home is always the correct decision.
| UncleOxidant wrote:
| Even if it doesn't happen very often, for a bank the risks
| are just too high.
| bityard wrote:
| To be blunt, it doesn't matter if it actually happens or
| not. It's about risk management. It is absolutely the norm
| in most companies to remove an employee's access to company
| resources if the termination was not the employee's idea.
|
| Other than general goodwill, there is no incentive to give
| an employee a heads-up that they are being laid off. And
| lots of downside if the employee happens to be disgruntled
| and do something evil. Goodwill does not show up on balance
| sheets. But theft and sabotage do.
|
| I'm not saying I like it, but I understand it.
| richardwhiuk wrote:
| Goodwill does normally show up on balance sheets
|
| "The value of a company's name, brand reputation, loyal
| customer base, solid customer service, good employee
| relations, and proprietary technology represent aspects
| of goodwill. This value is why one company may pay a
| premium for another."
|
| See https://www.investopedia.com/terms/g/goodwill.asp
| verve_rat wrote:
| The norm in US companies. Note that other places manage
| to lay people off with much more humanity.
| fragmede wrote:
| in this case, Facebook is navigating this by giving 5 months of
| severance, in excess of what the WARN act requires.
| newobj wrote:
| I absolutely picked the right year to become a solo indie game
| dev
|
| (after I was laid off :P)
| extrabladeworks wrote:
| Can't get laid off if you're the only employee
| paxys wrote:
| Try having an unhappy spouse..
| par wrote:
| how's that going? Not being sarcastic... i'm envious :)
| lightbendover wrote:
| I am teetering on the decision myself. Have you enjoyed it?
| cableshaft wrote:
| Doing that a bit in my spare time (hoping to get a game into
| Steam early access later this year, and I should be able to get
| a small mobile game released, it's already about 2/3rds of the
| way done).
|
| I'd consider going full-time indie, but then there'd be zero
| incomes in the family, instead of just one (partner is quitting
| her job and taking a break soon).
|
| Best of luck to you!
| gaws wrote:
| How are you supporting yourself?
| aaomidi wrote:
| Canceling my nitro
| Scoundreller wrote:
| Heh, I cancelled my newspaper sub once they went hard-paywall.
| I was happy to support the freeloaders but not once they axed
| them.
|
| Made for a confusing desub call.
|
| I'm sure they'll come out ahead but at least I know I hurt
| their user-hostile project's ROI a bit.
| aaomidi wrote:
| I basically don't think Discord is ever going to be able to
| support my platform of choice properly at this point (Linux).
|
| I hope this company crashes and burns, especially for what
| they've done to documentation availability across projects.
| choilive wrote:
| Not familiar with that issue, what did they do?
| letwhile wrote:
| But... they support "your" platform? It is running
| stunningly well on Linux. What are you talking about?
| ok123456 wrote:
| Thank you for your service.
| kevincox wrote:
| Reminds me of YouTube Red (as it was called at the time)
| where they were really pushing these original premium films.
| But my favourite part about YouTube is that I can share the
| videos I watch. As a subscriber it was actually doing me a
| disservice to lock them up because I wanted my friends to
| watch them and discuss.
| bovermyer wrote:
| OK, the layoffs suck, and the whole "failed to realize the
| pandemic growth wasn't permanent" thing is getting way
| overplayed.
|
| However, these are some crazy exit packages. Five months of
| salary? Health insurance through the end of 2024? That's a heck
| of a buffer.
| para_parolu wrote:
| With such package I would voluntarily quit.
| theonething wrote:
| In this (tech) job market, I would not.
| scrapcode wrote:
| I think it seems fair. Maybe forums are biased toward the
| negative, but it seems like the market is tough and it is
| taking even highly qualified individuals at least that amount
| of time to find something new.
| cagenut wrote:
| what does 'fair' have to do with anything
| ryangs wrote:
| Being 'fair' helps company relationships with current and
| future employees.
| bruce511 wrote:
| Does it though? In my experience any "credit" for fair
| behaviour disappears very fast. Employees don't really
| care about fairness, they care about themselves here and
| now.
|
| Equally businesses see employees as disposable, and work
| to maximise short term profit, not fairness. There's
| generally a lack of trust in one, or both sides, and that
| results in poor behaviour from both sides that spirals.
|
| Sure there are great companies to work for, but all their
| greatness is tossed aside as soon as a better offer comes
| along. Employees look out for #1. Employers do the same.
| scrapcode wrote:
| One would like to hope that some of these companies act in
| a manner that when the shoe is on the other foot, and it is
| an employees market again, that they will be judged by
| their actions.
| spacemadness wrote:
| This forum seems swarming with people with an axe to grind
| against SV employees of late. As far as I can tell some
| people think they are well informed on the matter purely from
| following people on TikTok. Such as the "they only work 6
| hours a week" crowd.
| rchaud wrote:
| Not just that, the comments on these layoff posts seem to
| put engineering staff on some "un-fireable" pedestal but
| think of PMs, Sales and Marketing, Admin people as
| eternally expendable.
| paxys wrote:
| While the severance definitely makes things easier, layoff
| season is also a terrible time to look for jobs because there
| are like 300,000 other qualified candidates with big company
| credentials in the same situation as you. The cushion isn't a
| luxury but a necessity. In some jurisdictions it is legally
| required.
| pcthrowaway wrote:
| I'm wondering if by "layoff season" you mean the first
| quarter, or the entire last 2 years?
|
| January of last year had more than twice as many layoffs as
| any other month of the year, and the first quarter of '23 had
| nearly twice as many layoffs as the rest of the year
| combined. Not sure if we'll see the same trend this year, but
| it does seem like there have been an uncharacteristic number
| of layoffs this month already.
| emestifs wrote:
| Consider the holidays in December as well. It's possible
| some layoffs were finalized but not enacted until after.
| YetAnotherNick wrote:
| > In some jurisdictions it is legally required.
|
| Which jurisdiction requires 5 months of salary?
| paxys wrote:
| _Waives hand in general direction of Europe_
| fh973 wrote:
| Germany: not anywhere close. Typical is 0.5-1.0 monthly
| salaries per year of employment.
| kuschku wrote:
| Die Kundigungsfrist beginnt bei 3 Monaten und geht
| schnell auf 2 Jahre hoch. FAANGs suspendieren ihre
| Mitarbeiter ab dem Punkt, wo die Kundigung mitgeteilt
| wurde, dementsprechend bekommt man ublicherweise die
| Kundigungsfrist ausbezahlt.
| Teledhil wrote:
| For example, up to 12 months of salary in Spain (with 20
| days of salary for each year at the company), if a layoff
| meets certain conditions (that are usually met). Up to 24
| months (with 33 days per year) if the conditions are not
| met.
| xienze wrote:
| > because there are like 300,000 other qualified candidates
| with big company credentials in the same situation as you
|
| And to add insult to injury, there will inevitably be lots of
| sound bites from CEOs whining about a lack of engineering
| talent, so can we please raise H1B limits???
| IshKebab wrote:
| I keep hearing this on HN about companies abusing H1B, so I
| was like "ah cool must be easy to get a software job in
| America then; I'll have a go" (I live in the UK).
|
| But then I actually looked at the H1B process. It's insane.
| Not only is there a limited lottery but it only happens
| once per year. It's not like you can get a job and then
| apply for a visa.
|
| Is H1B abuse real or are are American HN's commenters _way_
| overplaying it?
| hibikir wrote:
| The current H1B system of limited visas has far more
| demand than there is supply, but it's easier to abuse by
| certain kinds of firms. For an American company trying to
| hire someone off the street that is living in the UK, the
| math is so bad few would try: In the real world,
| companies tend to only try with people that are already
| working for them. So if, say, Google had someone working
| off a UK office, and wanted to move them to the US, it's
| relatively OK if they don't do well in the lottery that
| year, because they still have an employee.
|
| The abuse comes from companies built entirely on this:
| Imagine we are running a contracting company from some
| cheap country. We have 6000 consultants we'll be able to
| bill higher from the US. So we ask our US subsidiary to
| just file said 6000 applications. Only 2000 got accepted?
| Who cares! those 2000 people get moved to the US, and are
| now working for us, and then we contract them out to
| normal Enterprise companies at relatively low rates. It's
| not hard to claim this is abuse, as ultimately one wants
| to make applications for anyone with a pulse.
|
| Some commentators are definitely overplaying it, but any
| way you look at it, the system is not necessarily working
| all that well, precisely because the cap is relatively
| low, the number of random Indian contractors that would
| like to move in is very high, and those intermediary
| companies are rarely great, but they have a big advantage
| in the system compared to a small company that just
| really wants to hire one guy, or wants to keep someone
| that came in with a student visa, and has been doing
| practical training.
|
| Unfortunately there are so many competing interests that
| any kind of sensible immigration reform isn't going to
| happen, as getting the majority of the house and 2/3rds
| on the senate to agree on something this contentious is
| almost impossible, especially when one of the parties has
| people whose idea of the perfect number of immigrants is
| zero.
| vasco wrote:
| It's both. A few companies have most of the H1B
| allocations through basically fraud and they hold it over
| those workers heads because they need a sponsor or lose
| their visa. https://www.livemint.com/news/world/us-says-
| some-companies-c...
| kansface wrote:
| In the broader industry, I've never seen anything that I
| would qualify as abuse but abuse is very real at certain
| firms that specialize in hiring H1Bs.
| gwbas1c wrote:
| > Is H1B abuse real or are are American HN's commenters
| way overplaying it?
|
| Yes and yes.
|
| The long and short of it is that many companies don't
| want to pay market salaries, or have unreasonable
| expectations, and the H1B system basically lets a company
| hire at a lower salary than market salary.
|
| The H1B system also impacts immigrants' job portability.
| An H1B employee is less likely to leave a bad job for a
| better job, thus H1B employees are more desirable because
| of the lock-in.
|
| Edit: The other half is that a lot of people "age out" of
| tech for various reasons and like to point a finger.
| Working in tech at 40+ years old is very different in an
| industry that typically hires people in their 20s and
| 30s.
| Exoristos wrote:
| Surely what's relevant is the number of H1B workers in
| the U.S., not how hard the process appears to be.
| Amezarak wrote:
| Yeah. I got laid off a few months ago and I can't even get an
| interview. Never had that problem before.
| emestifs wrote:
| You're not alone. Many are seeing the same thing.
| ricardobeat wrote:
| Nothing crazy about it if you compare to whats _required by
| law_ elsewhere. In the Netherlands you'll get at least 3 months
| salary, possibly more if the layoffs were negotiated with a
| works council, an additional N months depending on your years
| of employment, and healthcare, well, is not tied to your job at
| all. Nothing extraordinary about it.
| xnx wrote:
| Netherlands seems to do a lot of things right, and I know the
| US isn't making all the right tradeoffs, but lack of safety
| net is one of the reasons US pay is higher.
| rchaud wrote:
| US pay is higher because there is a bottomless pool of VC
| money in California, not because of onerous hiring
| regulations.
|
| Discord is wildly unprofitable, it is held up entirely
| through investor largesse.
| huytersd wrote:
| It's not that crazy considering all the layoffs are happening
| at the same time and new openings are slim. I wouldn't be
| surprised if almost everyone laid off have to use all the
| buffer provided before they can find another job.
| rqtwteye wrote:
| This buffer evaporates very quickly in a bad job market as I
| learned in 2002 and 2003. I think the only "crazy" exit
| packages are when they throw dozens of millions after failed
| executives.
| renewiltord wrote:
| A friend worked at Google. Pretty lazy guy. A few months salary
| to quit, but 8 months to wind down what he worked on. In truth,
| one year's pay to do nothing. He, predictably, did nothing.
| bityard wrote:
| This reminds me of the show Silicon Valley, there is a
| subplot where one of the main characters is unassigned from
| his own project but not given a new team or project. Just,
| unassigned. He wanders around the building and eventually
| makes his way to the roof where he runs into a small crowd of
| other "unassigned" employees. They mostly badge into the
| office, head to the roof and sit up there all day doing
| nothing of importance.
| nus07 wrote:
| Big Head has always been an inspiration . Maximizing gains
| with minimal effort . If only I could make it work in real
| life lol.
| abledon wrote:
| when people slack at their jobs and just let other team
| members pick it up... it seems so scummy. Someone has to
| have a 'challenging' upbringing to have this be their
| default mode of operation.
| tomatotomato37 wrote:
| If I remember right Big Head wasn't lazy, just clueless.
| The fact he unintentionally failed upward as much as he
| did was part of the comedy.
| bongripper wrote:
| https://www.youtube.com/watch?v=QAiPcPRZlBk
|
| The main character is nicknamed "Big Head", just
| referencing his big ol' dome.
| swingingFlyFish wrote:
| You should watch Office Space.
| mensetmanusman wrote:
| it takes six months to get hired for many.
| maxioatic wrote:
| I believe it's only five months of health insurance since it
| says "Five months of benefit continuation". It does also say
| "Continued access to Modern Health through the end of 2024",
| but Modern Health is a mental health platform.
| _justinfunk wrote:
| I wonder if the new IRS section 174 rules are intensifying these
| tech lay offs. As far as I understand it, software engineering
| salaries are no longer fully tax deductible in the year they are
| paid, instead they can only be depreciated at 20%.
| wutangisforever wrote:
| i don't really get why this law was invented, what was it
| supposed to prevent?
| badpun wrote:
| I'm not an accountant, but to me it looks like the IRS was
| operating at an assumption that the software engineers write
| is not immediately consumed, but rather has on average 5
| years amortization period (meaning, it's producing value for
| 5 years, on average).
| dathinab wrote:
| seems reasonable iff you have a tax system where this
| deductability is based on the product employees produce
| which seems strange to be but might be normal
|
| if I understand it correctly it means the cost of this year
| would be written of over 5 year each year 20%, but if you
| keep your employees it means in the second year you have
| 20% write off from that year and 20% of the previous years
| and so one, so 5 years in still 100% write off every year
|
| I wonder if that would motivate companies to have a more
| constant number of employees or more precise a similar
| income bill every year.
|
| Through it would definitely mean if you had considered
| layoffs this year is the year to go.
| ethbr1 wrote:
| I am not an accountant, but there wouldn't be a
| requirement to keep the employees.
|
| If you spent $100M on developer salaries in FY2022, you'd
| create an amortization for that over the next 5 years.
|
| And then in FY2023... _even if you had fired your entire
| software department_... you 'd still get to claim that
| year's portion of that previously created amortization.
| hodgesrm wrote:
| That's correct as I understand the tax law. The credit
| carries over because it's depreciating the capital
| investment. Net operating losses (NOLs) work in a similar
| fashion. You get them as a credit in later tax years.
|
| IANAL but have filed corporate taxes many times.
| bruce511 wrote:
| Yep, it incentivizes getting rid of software staff as
| soon as you can after they complete the work. It makes
| downsizing especially profitable in the short term.
| thinkerswell wrote:
| Yes because normally, without this absurd law, you'd just
| deduct employee salaries from your taxable income.
| dathinab wrote:
| yes, I didn't try to say there is an requirement to keep
| them the writeoffs are base on what they are assumed to
| have produced not them being there so they would go one
|
| but when keeping a job position (not necessary the same
| person tho) through overlapping writeoffs it will lead to
| a consistent 100% writeoff
|
| not doing so can lead to spkies of little writeoff when
| increasing company size and the opposite when shrinking
| it. This would make new hires on a limited budged harder
| and in turn should motivate more long term planing when
| it comes to head count and that might lead to less head
| count fluctuations maybe
| jacobyoder wrote:
| No more than 10% in the first year is deductible.
| everforward wrote:
| 5 years is the shortest, 15 is the longest. Their
| assumption is that 5 years is the minimum time that it
| provides value.
|
| I don't think there's any real logic to it, it's just a way
| to balance the tax budget.
|
| For 1, presuming that all software engineering is "research
| or experimental" is faulty. The vast majority of software
| engineers are implementing known things, and the
| "experimental" status reflects its reliability. Most
| "experimental" software isn't really doing experiments to
| answer questions, it's just checking whether an approach
| works correctly. I don't think anyone could honestly call
| writing an Okta integration for a SaaS app "experimental".
| You know that it will work ahead of time, you just aren't
| sure if your pass implements it correctly.
|
| For 2, this would imply insane things if applied to other
| fields. What is the correct period to amortize a bridge
| engineer's salary over? 50 years? 100? We still have some
| Roman bridges around, maybe we need to look in the
| thousands of years. Patents are good for 20 years, so any
| salaries that lead to a patent clearly need to be 20 year
| amortization. Copyright is life + 70 years, so graphical
| designer salaries should be amortized over at least 100
| years.
|
| I don't think there's any real logic here, it's just a way
| to balance the tax budget.
| blihp wrote:
| Anything that pulls in income and/or pushes out expenses
| results in a higher tax liability to the IRS. It makes a lot
| of sense in the world of real estate and equipment expenses
| (i.e. items which have very long useful lives to a business),
| less so for labor and other short term expenses.
| bobthepanda wrote:
| The deficit hawks have routinely included legislation that
| included automatic ways to reduce the US deficit to be
| implemented at a future point in time, when hopefully
| Congress has sorted out whether or not such a thing is
| actually desirable. It's essentially a budget Sword of
| Damocles.
|
| Of course, Congressional budget negotiations have been an
| unproductive circus show for a while, so this never actually
| happened and the thing that was never actually intended to go
| in place went in effect. With the current razor-thin majority
| in the House constantly getting derailed over budget
| negotiations, this is unlikely to resolve any time soon.
| curtis3389 wrote:
| If they set it in motion and say they'll stop it before it
| causes pain, they have no intention of stopping it.
| Sequestration in 2013 was a solution to a political
| problem. Nobody wants to be blamed.
| bobthepanda wrote:
| This particular set of regulations was from the Trump tax
| cuts, which were passed by reconciliation and had to be
| "budget neutral" as a result.
| bcrosby95 wrote:
| Achieving budget neutrality with a policy that won't come
| into effect for 5 years, that people expect to be
| negated, is an "interesting" hack.
| fauntle wrote:
| ...and that will come to fruition during a subsequent
| administration. It was one of the many time bombs set up
| to make the opposing party look worse come election time.
| ojbyrne wrote:
| As I understand it, it's because they could pass
| "temporary" tax cuts with only 51% in the Senate through
| the "budget reconciliation process. The Republicans at the
| time did not have the 60 votes necessary to defeat a
| filibuster. Not quite the same.
|
| https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act
| bobthepanda wrote:
| There hasn't been 60 votes for a long time.
| Reconciliation is how a lot of normal legislation is
| passed.
| UncleMeat wrote:
| The change was part of the trump tax bill, which at least
| needed to be able to claim that it was revenue-neutral after
| 10 years to be able to be passed through the budget
| reconciliation process.
| btown wrote:
| https://blog.pragmaticengineer.com/section-174/ is a good
| overview and describes some of the history:
|
| > In 2017, then-President, Donald Trump, signed the 2017 Tax
| Cuts & Jobs act, which overhauled tax codes and reduced tax -
| for example, it reduced the top tax bracket from 39.6% to
| 37%. To make the bill pass strict budgetary rules, the Senate
| used a process called reconciliation: adding in tax code
| changes that delayed tax increases. These delayed increases
| "balanced out" the tax reduction.
|
| > One of these changes was Section 174, set to come into
| effect 5 years later, in 2022. These parts deliver the blow
| by making it clear that software development costs need to be
| amortized over 5-15 years. Most experts expected Congress to
| push back the Section 174 amendment to a later date, or
| simply remove it. But Congressional negotiations to repeal
| the changes fell apart at the last minute in December 2022,
| meaning it became law.
|
| > Amazon, Microsoft, Intel, Ford, Lockheed Martin, and other
| US companies created the US R&D Coalition in 2018 to advocate
| in reversing this change. This group concludes... "By
| diminishing the near-term value of R&D expenditures, the Tax
| Cuts and Jobs Act will reduce incentives for companies to
| invest in the development of new products, ultimately hurting
| consumers and businesses alike."
|
| > What about VC-funded companies? For loss-making companies
| this change doesn't make much of a difference. But the change
| does impact VC-funded companies near to break even. Most VC-
| funded companies close to breakeven have big-enough cash
| buffers with which to pay unexpected tax bills. However,
| these companies might reduce hiring - or even consider
| letting go staff.
|
| My 2c are that big tech companies with large amounts of cash
| on hand wanted to be seen optically as fighting against this
| change... but those with cash on hand would also benefit from
| being the only ones able to weather the storm relative to
| their would-be competitors. It's unclear that incentives were
| aligned here among those companies with lobbying budgets.
| hibikir wrote:
| You have chunks of the explanation in other responses, let's
| try to put them together:
|
| Since Obama became president, all legislation basically needs
| 2/3rds of the senate to pass if it's remotely controversial
| and every tax change is controversial. There is one exception
| though: if the bill is of a budgetary nature, and is revenue
| neutral over 10 years.
|
| Trump really wanted to pass some tax cuts in 2017. But as
| you'd expect, claiming that a big tax cut is revenue neutral
| is far more than the senate parlamentarian would believe. So
| instead, some tax cuts are made temporary, and some tax
| changes are made that would gain revenue. Then the whole
| thing appears to be revenue neutral over a decade, because
| nobody expects that the poison pills at the end will actually
| be allowed to happen. They tend to come in 6+ years later, as
| to make sure that all senators and the president might also
| claim said increases are not their problem.
|
| So the expectation is that a future congress will just undo
| those tax changes, and push them further into the future, by
| again making another bill that looks revenue neutral in the
| long run, but is just kicking the ball down the road.
|
| The congress since the midterms, however, is even less
| functional than in the Obama or Trump years: So the poison
| pills that are not supposed to happen are starting to happen.
| Other cuts that occurred, like the increase of the standard
| deduction, were also marked as temporary, and could come back
| if congress doesn't do anything.
|
| So ultimately it's all side-effects of people trying to
| bypass congressional rules, because otherwise we'd not see
| anything other than emergency spending bills passing in
| congress. Changes to legislation that would make this kind of
| dysfunction stop happening are even harder to pass. Every
| incentive pushes politicians of all parties to play with
| fire. This time we got burned.
| laidoffamazon wrote:
| Same reason why the Trump Tax cuts almost made PhD tuition
| waivers taxable.
|
| 1) Tech workers are liberals
|
| 2) Liberals being owned is good if you're an administration
| consumed with punishing your enemies and enriching your
| allies
|
| #2 is also why SALT deduction was curtailed, to punish blue
| states. While I think that's accidentally good policy, it
| made people mad enough to flip the House in 2018.
| cjbgkagh wrote:
| Wow - that is absolutely insane. I had no idea that existed.
| Looked it up, section 174 amendment added in Tax Cut and Jobs
| Act 2017 coming into effect 2022.
| Workaccount2 wrote:
| Worse is that it was fully expected to be repealed before
| becoming law, but then got stuck in political quagmire. So
| here we are...
| cjbgkagh wrote:
| It makes sense that it was expected to be repealed, it's a
| cash grab from small to medium businesses (SMEs) who are
| growing and are at least making some money. Traditionally
| tax law would provide breaks for this category as an
| 'investment' because they would get more tax later out of
| the bigger company these SMEs would turn into. It's a major
| drag at already the most difficulty time for a fledging
| company and would have hit me badly had I stayed in the US.
| wait_a_minute wrote:
| I think if you survive(d) layoffs, then that means the company
| employing you now has a more long-term view of their investment
| into your onboarding and continued growth. So while the pain at
| first may be jarring, in the long run it is worth it if the
| move causes companies to view their developers as long-term
| team members rather than assets which can be depreciated right
| away.
|
| Especially in vesting environments, where devs need to wait for
| the vesting to have made their R&D-heavy roles worth it from a
| monetary point of view. Well, large firms will need to give
| their devs enough runway now so that they can depreciate the
| costs over a longer period of time instead of only thinking in
| the short term. They can still fully deduct the salaries, just
| over a longer period of time. It is 5 years for domestic R&D /
| development and 15 years for foreign. I think that is good and
| will cause better treatment of developers in the long run.
| boringuser2 wrote:
| The problem is that we now have a massive surplus of skilled
| engineers so good luck getting hired when you're inevitably
| arbitrarily let go.
|
| Your mindset is only valid in the explicit context of a
| company
|
| A) not having cut you
|
| B) having cut others prior to you
|
| As soon as that context is lost in the next two years when
| you get fired or find a new job, you're back to square one,
| except you're also competing against Joe Google Engineer.
| wait_a_minute wrote:
| Switching companies frequently increases comp, but it's
| less safe from the point of view you brought up around
| starting from square one in terms of rapport and "safety."
|
| I think this is a normal trade off. You left a team or a
| company for more money. There is nothing wrong with this,
| but you necessarily need to start from a new context since
| it's a new team. When times are tighter because of economic
| cycles, this means that you should be more intentional with
| changing a team so that you are sure you will be able to
| compete with Joe Google Engineer. It's still a competition
| in some ways, and that's fine.
|
| If you find a good place, stay a while in tighter economic
| cycles in order to build more skills and rapport and then
| hopefully, and realistically based on experience, you'll
| have more runway within that company even if times are bad
| or if your performance sometimes is low because of life
| events.
| datadrivenangel wrote:
| Until they do 5 more rounds of layoffs over the next year.
|
| Last startup I worked for is on round 7 of layoffs /
| restructuring right now.
| wait_a_minute wrote:
| I believe that if an organization is having that many
| layoffs, that means they are imploding and it is not quite
| the same thing as these smaller rounds. So far I've not
| seen indications that software teams are experiencing this
| many cuts. That would significantly compromise critical
| infrastructure and development knowledge and domain
| knowledge on too many teams and cause too many products to
| degrade.
| alok99 wrote:
| I'm having a hard time understanding how this leads to lay
| offs. Software engineering salaries being amortized over 5
| years leads to an increase in yearly taxable income for the
| company. So what makes this a bad thing for the company? Are
| they doing the layoffs just to reduce total income to bring
| taxable income back down to (or closer to) 0? I.e. is this all
| just to avoid paying more taxes?
| supportengineer wrote:
| Small startups who were not anticipating this change may not
| have the cash available to pay the tax bill due on that
| taxable income.
| zooq_ai wrote:
| Small startups almost make no profit for this to have any
| meaningful impact
| klohto wrote:
| That is the point? They don't have any means how to pay.
| supportengineer wrote:
| All other factors being the same year to year, this
| accounting change will suddenly show the company making a
| sizable profit. Because the R&D cost (engineer salaries)
| can no longer be expensed.
| jacobyoder wrote:
| Exactly. How we've thought about what 'profit' is has
| changed.
|
| When I bought a laptop for my business, it was amortized
| over... 3 years I think. Kinda nuts but, whatever. It's a
| couple thousand dollars.
|
| But the example above (somewhere) with the 5 employees at
| $200k/each... only being able to deduct $100k of that,
| even assuming $1m in revenue... meaning 'profit' of
| $900k.... it's just crazy.
| opt1c wrote:
| Actually, this has the most impact on startups that are
| close to break even or barely making profit. Let's say
| you make 1m ARR and have 5 software engineers at
| 200k/year. Prior to this tax code, you had $0 in profit
| to be taxed. With this change, you can only amortize 10%
| of software labor in the first year. Now, the IRS treats
| you as having 900k profit so you have ~200k in taxes to
| pay.
| addicted wrote:
| Tech Companies that are not making profits are the most
| affected.
|
| Let's say you have $100 in revenue, $100 in salary
| expenses and $50 in other expenses.
|
| Pre 174 you would be considered to have a loss and
| wouldn't pay taxes on profits since you don't have any.
|
| However, post 174, since you're amortizing salary
| expenses, you can only deduct $20 out of that $100
| (actually the scaling is a little weird I believe, so
| it's even worse and the first year you can only set aside
| 10%), so as far as the IRS is concerned you made $100 in
| revenues and $50 + $20 in expenses, so you had a profit
| of $30. So somehow you now need to find actual cash to
| pay for the $30 in profits when in reality you've paid
| out more than you've made.
|
| This just means you have to raise more funds for
| something that is not returning any value to you.
|
| Your competitors abroad don't need to do this. Your deep
| pocketed large competitors don't need to do this. They
| have cash to pay and they will get the money back in 5
| years, a time which you may not even survive to receive
| that set off.
|
| This is the worst kind of policy because it doesn't even
| make the government more money (the overall tax deduction
| is still largely the same) but it makes things way worse
| for companies.
| ojbyrne wrote:
| The weird scaling is what's called in accounting the
| "half-year rule." Any depreciable expenses are assumed to
| have been incurred halfway through the year, so the first
| year you can only deduct half of the normal amount (and
| the other half of that is in the last year + 1 of the
| depreciation period).
| hodgesrm wrote:
| That's not true.
|
| To take a simple example under Section 174 rules let's
| take a bootstrapped business with one US-based developer
| developing a SaaS product. If you pay them $100K and also
| bring in $100K revenue, prior to Section 174 the taxable
| revenue was 0. Under section 174 the business now can
| only claim $20K and the taxable revenue is $80K. Your tax
| bill is some fraction of that after you get done applying
| credits of various sorts.
|
| The problem with the Section 174 change is 2-fold. It was
| unexpected--most people assumed it would be corrected. It
| also hits bootstrapped businesses hardest, which are
| exactly the sort of businesses we should be encouraging.
| VC-backed businesses have less of a problem early on
| because their expenses tend to be so high that even with
| Section 174 they aren't profitable. However even there as
| a founder there can be a substantial impact, because the
| Section 174 charges eat up your Net Operating Losses
| (NOLs) which you can use to offset the profit from
| selling the company or future tax bills.
|
| Edit: as others have pointed out the amortization
| schedule is apparently not linear, so 20% might not be
| right. The other complication is that there are _many_
| deductions and adjustments that affect your taxable
| revenue. NOLs are the biggest in my experience but there
| are others.
| opt1c wrote:
| Imagine you're a small business that makes $1m ARR and you
| employ 5 software engineers at $200k per year. Your net
| income is 0.
|
| Prior to this change in the tax code, your software labor
| costs for that year would all count against your income so
| you'd be taxed on $0 in profit.
|
| With this tax code, you can only amortize 10% of software
| labor in the first year so now your business just had $900k
| in profit as far as the IRS is concerned. You now have to pay
| ~200k in taxes. You have to come up with that money somehow,
| and for most businesses the only short-term option is a combo
| of reducing costs (layoffs) and loans.
| shmatt wrote:
| Discord isn't profitable
| UncleOxidant wrote:
| In addition to more layoffs/less hiring it looks like there are
| a lot of undesirable side effects of this change, especially
| for small to medium sized companies. Including moving IP out of
| the US. What were they thinking?
|
| https://newsletter.pragmaticengineer.com/p/the-pulse-75
| redcobra762 wrote:
| The context of the 2017 tax cuts is important; it was/is a
| major feather in the administration's cap.
| UncleOxidant wrote:
| I've seen some suggestions that this was done specifically
| to punish blue states where most of these kinds of jobs
| reside. I'm not sure they were actually thinking that far
| ahead, but I guess I wouldn't put it past them.
| nullserver wrote:
| Or reward states that have lower taxes.
| addicted wrote:
| Since those states are receiving funds from the federal
| government you're not really rewarding lower taxes.
| You're just rewarding poor fiscal management.
| ojbyrne wrote:
| The fact that the same legislation capped the SALT
| deduction lends credence to your argument.
| cjbgkagh wrote:
| I knew bracket creep was going to a land mine and did
| figure they included others to make the numbers work out
| the way they did. Now the government makes more money with
| higher inflation which I think is a risky alignment of
| incentives.
| cscharenberg wrote:
| It definitely affected hiring. I work at a startup that is
| self-funded, profitable, and at about 24 people. The tax
| change increased our tax bill by around $125k, so that's an
| engineer we couldn't hire.
|
| Made me glad our founders are so fiscally conservative, as
| other startups around had to lay off some people to have cash
| on hand to pay the increased taxes.
| nocoiner wrote:
| If I'm reading that right, that seems to be referring to
| foreign-originated IP, that's been contributed to a Delaware
| corp, but is now being repatriated elsewhere to avoid Section
| 174. I assume the reason the associated software development
| activities are no longer subject to 174 is because there's no
| longer a US taxpayer involved. Is this really applicable for
| US-originated IP? To the extent that there's still US tax
| jurisdiction involved, doesn't that just put you into the
| world of transfer pricing, GILTI and such?
|
| I'm also fairly skeptical that this is all that much of a
| deterrent to doing business in the United States. The US had
| uncommonly high corporate tax rates until recently, and that
| didn't seem to adversely affect economic dynamism. I mean,
| sure, one can avoid this particular taxation regime by
| (checks notes) moving the entire operation to another
| country, but that obviously sacrifices the advantages of
| doing business in the US (deep and liquid capital markets,
| well-known legal regime associated with investing in a
| Delaware corp, network and agglomeration effects, etc.) and
| the replacement jurisdiction is certainly going to have its
| own set of downsides.
| adrianmonk wrote:
| > _What were they thinking?_
|
| "Tech companies, specifically, have lots of money. How can we
| get some of it?"
| dustingetz wrote:
| Venture capital investment dollars are not revenue and not
| taxed as revenue - so not sure if discord is profitable or what
| (edit: article says it's not) but the rule doesn't impact
| growth stage cos iiuc. Really it just impacts bootstrappers who
| are royally fucked, good job USA
| SirensOfTitan wrote:
| The fact that, as far as I understand, section 174 rules are
| disliked across the aisle, yet Congress cannot get its act
| together enough to fix what will wreak the pipeline for
| arguably the most valuable and dynamic part of the US's economy
| speaks volumes. The legislative branch of the US federal
| government is in such dire need of reform.
| pc86 wrote:
| What reforms exactly would fix that?
| rmrk wrote:
| Campaign finance reform.
| Andaith wrote:
| Like the other commenter said, campaign finance reform. But
| also, I feel like Americans don't even discuss what other
| improvements they could make:
|
| - No more gerrymandering
|
| - Mandatory voting(You can still vote for nobody, but you
| have to go to a polling station)
|
| - Voting always on a weekend
|
| - Strict rules about how many polling places per X many
| people
|
| - Preferential Representation voting system instead of
| first-past-the-vote.
|
| Look at how Australia does it.
| mensetmanusman wrote:
| Is this just a Biden admin thing? Or were finance people
| gunning for tech layoffs for a while?
| jacobyoder wrote:
| This was legislation passed under Trump, but didn't take
| effect until 2022.
|
| Take credit for "lowering taxes"... push the effects of the
| time bomb on to a future administration. Definition of stable
| genius... ;)
| mrguyorama wrote:
| It's quite literally taking a loan from the future.
| midasuni wrote:
| Politically it's a master piece. Take the credit and move
| blame to the next guy.
| dylan604 wrote:
| It wouldn't look like such a master piece if Trump won
| his re-election. It would have happened during his watch.
| So, are you saying he's such a master that he knew he
| wasn't going to win (which is contradicted by the
| tantrums thrown saying he didn't lose)?
| KittenInABox wrote:
| Trump runs on a cult of personality, not real policy. If
| he had won, he'd either use his cult of personality to
| ensure the poison pills don't happen or he spin the
| poison pills as victories because they harm tech
| companies. Remember, a voter upset with him once said on
| him "he's not hurting the people he needs to be". If the
| economy is harmed because of Trump admin's poison pills
| and Trump isn't president, that's Biden's fault because
| he's an incompetent leader look how bad the economy is
| doing under him, but if Trump is president and the
| economy is harmed from those same poison pills, Trump is
| just hurting those fat-cats who need to get taken down a
| peg anyways.
| jjoonathan wrote:
| The dems wouldn't have dug in their heels to oppose a
| can-kicking fix.
| lalaland1125 wrote:
| This is a Trump admin thing, with a delayed fuse so his
| successor gets blamed
| pkilgore wrote:
| Passed by the Trump administration to help make the long term
| CBO math work on cutting taxes for the wealthy.
| chuckadams wrote:
| I don't get it: a _salary_ is a depreciable asset? I thought
| that only applied to actual tangible things that needed
| replacement on a schedule. I 'll never understand accounting...
| and I'm increasingly thinking that's the point.
| gen220 wrote:
| The idea is that you're converting some % of developers'
| salaries into intellectual property (i.e. code), and that
| intellectual property is a capital asset that depreciates
| over time in the same way that a tractor or a widget-making
| machine would.
|
| The salary is not the asset, it's an expense that produces an
| asset.
| chuckadams wrote:
| Ah, that makes sense now. The value of the code itself as
| an asset would be really subjective, but what you pay
| someone to write it isn't. Thanks :)
| mdavidn wrote:
| The reason amortization exists is to reduce taxes in later
| years:
|
| If a company invests $1 million into an asset that earns
| $250k each year over 5 years, the company would otherwise see
| a $750k loss the first year followed by $250k profit for 4
| years. By following an amortization schedule, they are taxed
| on a steady $50k profit each year. In other words, the
| taxable effect of the expense is "spread" through the years
| in which that asset is expected to earn income.
| whalesalad wrote:
| gotta cover the midjourney cdn bill somehow
| HumblyTossed wrote:
| Going to be a lot of lay-offs this year as employers reset
| employee expectations.
| dotnet00 wrote:
| Hopefully those were the guys that have been mostly ruining the
| mobile app UI over the past couple of years. Discord is the only
| app I've felt the need to turn off updates for.
| cobalt60 wrote:
| discord was done for me when it became whatever it is now than
| it was envisioned earlier.
| lulznews wrote:
| Hmm. Coordinated effort to depress salaries? How did that work
| for Steve?
| seydor wrote:
| how does discord survive? they also seem to have a large spam
| issue and they are stubborn on not implementing obvious features
| busymom0 wrote:
| What features? Asking as someone who doesn't use discord much.
| seydor wrote:
| bulk removing spam posts
| busymom0 wrote:
| Is the spam more like AI generated spam which is hard to
| detect?
| seydor wrote:
| no, spam users spamming with invites
| internet101010 wrote:
| Only being able to receive a DM from someone after approving
| a friend request. Last I checked you have to enable this
| after installing.
|
| It should be the default setting.
| didntcheck wrote:
| I'd also love to see their storage and bandwidth bill. They
| allow users to upload unlimited files with no retention limit,
| and have now upped the single file limit for Nitro users to
| 500mb. As a user I'm certainly not complaining, but surely it
| can't be sustainable
| FireBeyond wrote:
| I suspect there's a huge benefit to deduplication for things
| like gifs and memes and emoji for them. But yes, still.
| hn_throwaway_99 wrote:
| Frustrating, layoffs seem to be back in full swing. I posted this
| comment just yesterday,
| https://news.ycombinator.com/item?id=38945990, and since then HN
| had articles about Google layoffs, now Discord, and I also saw
| that FullStory had a pretty big layoff.
|
| It really had felt like things had stabilized a bit (at least for
| software engineers) in the fall. Was that just the lull before
| the storm?
| beretguy wrote:
| I started to bookmark all the layoff stories to see how many of
| them.
| pb7 wrote:
| No need.
|
| https://layoffs.fyi
| mrnaught wrote:
| https://layoffs.fyi/
| pb7 wrote:
| Cruise, Spotify, VMWare, and Unity were among the companies
| that had sizable (15%+ of a large group) layoffs before the end
| of last year. I don't think it ever really stabilized.
| alephnerd wrote:
| VMWare's is because of M&A. I wouldn't classify it's layoffs
| for the same reason as Cruise, Spotify, and Unity.
| hn_throwaway_99 wrote:
| But Cruise, VMWare and Unity's layoffs were all very much
| company-specific execution issues - I'd expect to see some
| layoffs like that even during boom times. Of that list only
| Spotify is really in the "we hired too much and now we're
| downsizing due to economic conditions" boat. In fact, I
| remember thinking "That sucks, this is the first one of those
| I've heard in a while" when the Spotify layoff was announced.
| ironlake wrote:
| I think many companies are anticipating a significant downturn
| in the economy and are trying to get ahead of it. Layoffs help
| stock prices almost immediately and management get bonuses for
| increasing the bottom line.
|
| Workers are defenseless. Save your money in case you're laid
| off. Work less if they keep you on.
|
| Let management be rewarded by nothing more than short term
| monetary gain. Don't give them extra productivity.
| shmatt wrote:
| >We grew quickly and expanded our workforce even faster,
| increasing by 5x since 2020
|
| Am i reading this right? Once the pandemic hit headcount went 200
| -> 1000 -> 830
|
| What is different in the user experience since 2020? I can
| understand needing an army of SRE's but this feels extremely
| bloated for a company who was able to run their product on a 200
| person crew
| dotnet00 wrote:
| Since 2020 they've screwed around with the UI several times and
| have added stuff like forums and threads.
| wrenky wrote:
| I think the growth of Discord partially explains it- They
| needed a _lot_ more SRE/Scale engineers, which causes growth in
| HR/Management layers.
|
| They also added a bunch of monetization stuff (discord nitro)
| and attempted to get more "community" based features like
| custom emotes/badges/profiles per server/watch party stuff.
|
| The core experience is the same, I think they've done a great
| job ensuring that doesnt change! They have also done the usual
| software stuff, improving core outskirts like
| stability/performance/login methods/slash options. Its the same
| core product but better.
| ketzo wrote:
| I'm sure their userbase grew in a big big way during the
| pandemic, but honestly, by the beginning of 2020 Discord was
| _already_ a massive operation. How much more headcount could
| pure scaling explain?
|
| I think you're more on the money with the miscellaneous other
| projects. They were even trying to sell games through Discord
| at one point.
| whatyesaid wrote:
| I guess they are building other products and trying to
| diversify, like a game store that flopped within Discord. To
| make the progress/maintain what they currently have, yeah, you
| wouldn't even need 200 people if they were halfway decent.
|
| Unlike Twitter or Twitch, they have to diversify, as I believe
| they are burning money on their core product. The benefits of
| Nitro is not much. But they aren't going to become profitable
| by paying engineers $400K on bad ideas and keeping the
| engineers on reserve duty, which they have probably been doing.
| okdood64 wrote:
| > I can understand needing an army of SRE
|
| As an SRE I can assure you, you don't need an army of SREs for
| a singular product.
| ok123456 wrote:
| Back to IRC
| subpixel wrote:
| I was unaware they turned down a $12 billion acquisition. I think
| that is pretty insane even in the 0% interest era.
| ketzo wrote:
| Eyeball test with zero context, but honestly? I doubt a 17%
| layoff will cut deep enough.
|
| That still leaves them with more than _4x_ the employees they had
| in 2020 (when the product had already reached massive scale and,
| IMO, very high quality):
|
| > "We grew quickly and expanded our workforce even faster,
| increasing by 5x since 2020," Citron wrote. "As a result, we took
| on more projects and became less efficient in how we operated."
|
| I know someone _always_ makes a comment about "wow, X company
| had Y000 employees? what do they even do all day?", and I don't
| wanna be glib, but it really does seem like they expanded beyond
| any kind of reasonable measure.
|
| If I were at Discord, and I wasn't part of an _extremely_ core
| team with a direct line to revenue generation, I would be
| sharpening up my resume.
|
| ---
|
| Edit: Okay, I missed this:
|
| > Discord has raised a total of about $1 billion in funding. It
| has more than $700 million in cash on its balance sheet and the
| goal to become profitable this year
|
| That's actually a lot better than I expected. Clearly they are
| making non-trivial revenue, and still have quite a bit of cash;
| maybe keeping a still-pretty-high headcount to pursue new
| monetization projects is the right call.
| shmatt wrote:
| Knowing the average SV interview loop too well, I can't imagine
| how many bad (for corporate type work) hires growing that fast
| brings in. A bunch of leetcode-hard optimized engineers being
| thrown into an organization that just grew from 200 to 1000
| people.
|
| If you are part of that 200 original group, you probably have a
| paycheck for another 5 years just answering tech debt questions
| autoexecbat wrote:
| When hiring fast, there's also an element of "we'll find
| something for you to do", meaning that you're expected to
| find something yourself. This can lead to people becoming
| very narrow on something that the business doesn't really
| value
| nine_zeros wrote:
| Or better yet, "We hired you to do some work" but at
| performance review time "tell us how you have made an
| impact"
|
| Dear company, I did what you asked me to do. If my work
| doesn't have adequate impact, that is on you for planning
| poorly.
| slt2021 wrote:
| thats the meaning of working for _engineering-driven_
| company. Engineers are _trusted_ to collaborate among
| themselves and drive feature roadmap, and to make an
| impact.
|
| Leadership doesnt trust non-engineers to handhold
| engineers and spoon feed feature requests, all non-
| engineer types should be focused on selling/marketing
| product or customer support
| kovezd wrote:
| Brilliant! As if a solid feature roadmap doesn't require
| inputs from sales, marketing or customer support.
| slt2021 wrote:
| what makes you think that engineering-driven cultures
| ignore or don't ask for input from
| sales/marketing/customer support?
|
| that's the collaboration part. But the final decision
| over prioritization of feature X over feature Y and
| planning is done by engineers, not salesmen
| nine_zeros wrote:
| > what makes you think that engineering-driven cultures
| ignore or don't ask for input from
| sales/marketing/customer support?
|
| The part where managers who don't partake in these
| efforts refuse to believe engineering estimates,
| engineering challenges and unknown unknowns and yet feel
| empowered to blame engineers in performance reviews.
| Xeamek wrote:
| That's all fine and dandy when you are small, and have a
| bunch of generalists that will throw themselves at any
| problem there is.
|
| But when you grow to the point of having a sizeable
| middle management layer that isolates engineers from one
| another, by enforcing strict area of interest for each
| team, you really shouldn't call yourself "engineering
| driven" anymore. And also, the more you scale, the more
| specialists you need. Specialists that aren't able, or
| just aren't willing to move from place to place rapidly
| schwap wrote:
| Unless your client base is exclusively the same kind of
| engineer employed by said company, how could that
| _possibly_ work well?
| slt2021 wrote:
| Goggle started it, I think it worked well for 1.9
| trillion company as gogel
| bluetomcat wrote:
| It sounds like a recipe for ruining a product and turning a
| company into a dysfunctional organisation. Onboarding 800
| idle people prepared to reverse linked-lists :-)
| Ekaros wrote:
| Seems like it ends up with lot features that few people
| asked. And then another bunch that no one asked. And then
| outright user hostile things like reworking entire UI time
| and again and somehow it being worse each time...
| Regnore wrote:
| Well maybe they just have like a lot of linked lists that
| they need reversed? With that many people working in
| parallel you could really increase the throughput of the
| reversing process. Of course this is assuming that you
| previously hired people to identify and remove any cyclical
| nodes in those link lists.
| seanhunter wrote:
| Tell me, what's the big O of having the people working in
| parallel on the reversing? And as a follow-up, can you
| explain whether it is better if you have a team of n
| people doing the cycle detection to do it using a system
| which is eventually consistent or strongly consistent and
| why?
| TylerE wrote:
| Now imagine if they opened those jobs to all of us in low
| cost of living areas instead of demanding in person presence.
| They'd get better people, and people like me would be getting
| a decent bump even if we were only getting 50 or 60% of SF
| salary.
| michpoch wrote:
| Why would they give you 50 or 60% of SF salary when they
| could hire someone in a real low cost area then?
| hn_throwaway_99 wrote:
| Exactly - I feel that folks in the US or Western Europe
| who are in "low cost areas" are in for a shock, as in
| many ways they have the _worst_ of all possible combos.
| Either you 're in a big "tech city" where being present
| (often in person) provides a tangible benefit that your
| employer is willing to pay for, or your essentially
| bidding on cost, where someone in a lower-cost country
| will be able to beat you every time.
|
| I've been in tech for a long time, but this is the first
| time we've had a significant downturn where
| remote/videoconferencing options have been so good. In
| the past it felt like executive cries of "we'll just
| outsource everything!" always backfired because the
| communication and management overhead (not to mention
| varying quality levels) had been extreme. Now, though,
| with everyone used to remote work, why bother looking to
| save a few bucks hiring in Wichita when you can save
| more, and get just as good if not better quality, hiring
| from Cordoba Argentina?
| oceanplexian wrote:
| Because they already hired those people. There aren't
| millions of super high skilled software engineers in
| Argentina or where ever, there are a limited quantity,
| and they are likely already employed somewhere.
| excord wrote:
| Discord interview questions are not your typical leetcode
| problems. Your premise is wrong.
| jonathankoren wrote:
| The graded lunch is dumb as fuck.
|
| "Do you play any video games?"
|
| "I've been playing a lot of KSP, but I'm not sold on KSP2
| yet."
|
| "Yeah, I don't play that game." _STRONG REJECT_
| excord wrote:
| Never heard of that happening, and neither would you,
| since you do not see interview feedback. Please don't
| make up a story.
| lispisok wrote:
| Off the top of my head I cannot recall any big features added
| to discord over the last few years. I'd like to know what those
| 4x more employees were working on.
| skrebbel wrote:
| Maybe not engineers? Discord quickly morphed from a place
| where gamers yell at each other into a place where lots of
| communities and movements exist. Maybe that skyrocketed the
| need for moderation, lawsuits of people _demanding_ that
| their former block party co-organizer gets un-admin 'ed,
| abuse reports, etc?
| ketzo wrote:
| They have been trying a _lot_ of different routes for
| monetization, and over a pretty short time period. Adding
| lots of little things to Nitro, more community server
| monetization features; at one point, Discord was even trying
| to sell games a la Steam.
|
| I'm sure that last one in particular had quite a lot of
| headcount associated, and it seems obvious that after they
| totally shuttered the project, they just reallocated the
| employees to new stuff.
| Xeamek wrote:
| They changed the icons for mute mic, and mute sound buttons.
| So that probably took at least a dedicated team and few
| months of work...
| spiderice wrote:
| > what do they even do all day?
|
| Discord has added a bunch of new features over the past couple
| years. Unfortunately, they don't seem to be very useful
| features (at least not to me). I still just use it for voice
| chat during video games.
| hamandcheese wrote:
| Their eng team wasn't particularly large. ~300 was what I last
| heard.
|
| I don't know how eng grew over that time, but it doesn't strike
| me as bloated given their scale and user base.
| brokencode wrote:
| One of the most surprising things to me during the pandemic was
| the dramatic hiring spree that almost every major tech company
| engaged in at the same time. I was getting pings from different
| recruiters multiple times a month during this time, and I'm
| sure others were getting many more.
|
| Today's layoffs are a direct result of the irrational
| exuberance of that era.
| Solvency wrote:
| Can someone explain this systemic hiring phenomena? A
| pandemic hits and every corporation thinks that's the time to
| hire and scale by gross multipliers? Why? Whose idea was
| this? How did it catch on everywhere?
| supportengineer wrote:
| The lockdowns which came about as a pandemic response
| resulted in a huge shift in spending - many companies were
| suddenly flush with cash, and many of them decided to use
| that cash to invest in their business, by hiring engineers.
| klooney wrote:
| With more engineers you could make more babies per month or
| something.
| mvdtnz wrote:
| A lot of companies saw unexpected spikes in revenue and
| wanted to strike while the iron was hot. The impulse was
| rational but the scale of the response was completely out
| of proportion with reality. But it's not like we saw hiring
| sprees in airlines and hotel resorts. We saw sprees in
| industries which benefitted from people staying at home and
| communicating digitally (like Discord).
| jhaile wrote:
| A lot of companies also saw spikes in revenue, raised
| money from investors at sweet terms based on that revenue
| growth (despite it being unsustainable), and then needed
| to spend that money to show they were going to use it to
| keep the good times rolling.
| shwashy wrote:
| Stock market was climbing and everyone thought digital was
| going to be permanently the new default, so companies tried
| to move quickly to land grab all this potential market.
| twh270 wrote:
| Federal pandemic money plus we were still at super-low
| interest rates.
|
| Now the Federal spigot has dried up (well, is back to
| normal) and interest rates are higher.
| tonyedgecombe wrote:
| Not every corporation, if I remember correctly Apple was
| quite restrained.
| dirtbag__dad wrote:
| Investors want more growth and that translates to hiring
| more people to do more things.
|
| Then it's painful when more people slow things down because
| there wasn't much process in place before the blitz hiring.
|
| This isn't a problem unique to engineering, you see it a
| lot with sales too. Leaders aren't experienced or self
| reflected enough to work smarter.
| mvdtnz wrote:
| > Clearly they are making non-trivial revenue
|
| "Non-trivial" is a very low bar to clear. It's obvious that
| Discord simply does not need to be the scale it is. It doesn't
| need a billion dollars and it doesn't need a thousand
| employees. It's very clear that they only have the employees
| because the investors were stupid enough to give them that much
| money, and they need to find something to do with it.
|
| Some products just do not need to be that big.
| loceng wrote:
| It seems most, if not all, big-successful companies use the
| formula to over higher and then you prune off the lowest-
| poorest performers - however that metric is determined.
| mikepavone wrote:
| As someone who joined pre-pandemic, my opinion is that we were
| unsustainably lean at the time. I was shocked at how small the
| infrastructure team was when I joined the company and things
| were honestly a bit rickety at the user scale we were at then.
| While engineering was probably the single biggest department, a
| large chunk of that 200 were in departments like Trust & Safety
| and Customer Experience (support).
|
| We saw a huge amount of user growth during the pandemic, we
| massively increased the number of users that could be in a
| single guild (server), we launched features that asked a lot
| more from our AV backend (stage channels, camera video in guild
| voice), had to deal with a massive increase in spam during the
| crypto boom, expanded voice calls to Xbox and PS5 and had to
| deal with an increasingly fraught regulatory environment.
|
| We also shipped a lot of user-facing features during that
| timeframe. Some of those ultimately got removed because of poor
| results and depending on your use of the platform I imagine
| some of those that stayed may not be particularly visible, but
| we really did ship a lot of stuff and I'm not going to attempt
| to list it all here.
|
| Obviously, in hindsight we should have had a tighter focus and
| probably hired a bit less, but this sentiment that we are/were
| hugely bloated feels pretty wild to me from where I'm sitting.
| ketzo wrote:
| This is great context and I really appreciate it. I honestly
| thought of Discord as being super stable even in 2020;
| interesting to hear things felt rickety, internally.
|
| My sense is that Discord was exploring a lot of different
| ideas for monetization all at once, and that maybe the sprawl
| of new projects got unwieldy, esp. in 2022-23; how accurate
| would you say that is?
| x0x0 wrote:
| Still -- my quick google came up with 750 employees mid 2023.
| So this is 125-ish employees. Particularly with 5 months
| severance, that seems too small to save much money (assuming
| $300k fully loaded, that's $40m pa) and also too small to
| materially impact velocity by reducing headcount and being
| more careful about commits.
|
| I'd expect more like a 50% cut to really speed up the
| significantly fewer projects by eliminating coordination
| overhead and giving PMs the ability to really slash projects.
|
| ps -- I'm not claiming it was bloated, that's (implicitly,
| and I believe fairly?) the ceo's claim.
| mooreds wrote:
| The article quotes the memo saying it is 170 employees.
| sosodev wrote:
| It's the way HN continues to rationalize the hundreds of
| thousands of layoffs. Every company is bloated and few
| software engineers are worth keeping it seems.
| letwhile wrote:
| Good management. But you can buy stickers and stuff
| gumballindie wrote:
| > "We grew quickly and expanded our workforce even faster,
| increasing by 5x since 2020,"
|
| Turns out ordering people back to offices is bad for the economy.
| Less disposable income and free time means people spending less
| sharing anime pictures on discord.
| hellotomyrars wrote:
| 700 million in cash is a massive warchest to be sitting on. I'm
| still doubtful on their path to profitability but having looked
| at their financials that are readily available, I'm actually more
| optimistic about their long term prospects. Absolutely sucks for
| anyone losing their job but assuming they actually deliver on the
| claims made here, it is an entirely reasonable severance package
| to me.
| sumtechguy wrote:
| Park it in 5% bonds. Can the employees beat that for making rev
| for the company?
| xnx wrote:
| I have to imagine some of these single product companies (Zoom,
| Dropbox, Discourse) will eventually get rolled up to make some
| office suite alternative to Mircrosoft Office and Google
| Workspace.
| nickstinemates wrote:
| I basically live on Discord these days. Love it. It's one of the
| best pieces of technology I have ever used. I hope they figure it
| out.
| bowsamic wrote:
| I just deleted my discord account after realising I live on it
| way too much. I will miss the people I met there, but it was
| consuming my life
| nickstinemates wrote:
| It's definitely the people that keep me on it and engaged,
| and how easily the software makes it happen. I've made a lot
| of friends, and it is nice to spend time with them there.
| gaws wrote:
| What servers?
| Solvency wrote:
| So this is just a new annual tech industry thing yeah? Because
| every year it happens, and always the same excuses. This screams
| of a boiling the frog strategy.
| dancemethis wrote:
| Time for them to cash in some more on the user data and metadata
| they are selling, I guess.
|
| Why these folks don't blow the whistle is beyond me.
| honkycat wrote:
| I wonder if this yet another layoff as a result of the R&D tax
| change for SWEs
| ptek wrote:
| 170 employees at average IT salary of $100,000 =
| $17,000,000.00USD.
|
| Saving 17 million a year is a lot. I feel sorry for the workers.
| Kye wrote:
| Do you think all the institutional knowledge that 17% took with
| them was documented somewhere in an internal Discord server?
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