Don't people have savings? Don't people see what's happening in the industry and make sure to have 6+ months of savings? Don't people think that putting away a small portion of their immense tech salary would be a healthy thing to do?
If you grew up with even the slightest feeling of financial insecurity, dipping in to savings can already feel like the end of the world.
I can't imagine living with only 6 months of savings. There's no guarantee that I could find another job in 6 months, and unexpected expenses (medical, car trouble, housing repairs) can easily wipe out a month of savings anyway. In fact, given that a layoff means likely also an economic downturn, finding a job at the same salary within 6 months seems highly unlikely.
I have probably 3 years of no-risk savings at this point, have managed to reduce my living expenses to the point where I could work a 40-hour minimum wage job and still pay for my expenses, and have multiple back-up careers, and I'm only now starting to feel that taking money out of savings is an acceptable risk. That took years of frugal living on a high tech salary. People in their first few years at a tech job or with families will probably never achieve that.
It's so frustrating reading the comments around here. It's like the conversation is driven by people whose circumstances fall on the upper tail end. No concept of financial insecurity. No long-term financial commitments to worry about. Infinite flexibility. Like jeez, congrats. Now try imagining somebody else that's not you.
> People often have long term financial commitments they cannot back out of, and not knowing how you'll make rent, if you can afford your child's school fees, or even maybe having to cut back on how much you eat, _is stressful_ and emotionally taxing.
I'm sure people making >200k/year and getting a 4 month severance package will be cutting back on how much they eat.
What you say is true about low or even medium income jobs. But most of the cuts are to tech workers and their managers, ie. people best equipped to manage in this kind of event.
You'd be surprised what lifestyle creep does to people. Often people don't pay off their debts and instead scale their debts to their new income - it's stupid I know.
I agree they should be in a better position because of their income, and I'd say more than an average amount are. But there are still a lot of people in that bracket who absolutely would have the floor pulled out from under them.
People are often caught with their pants down assuming the good times will keep rolling. And even when they see the market downturn or have a generous severance, it still can be very difficult to scrape together the 6+ months emergency fund required on short notice.
Depending on the resale value of what the debt is for (homes mainly) maintaining your leverage ratio can work out great for you. Mortgages are the only way most people are able to invest with leverage and the source of a lot of generational wealth.
That's true, but if you over-leverage yourself and the market goes through a downturn it can spell financial ruin. It's not something to lightly do without the cashflow/assets to back up your financial knowledge - which most people don't have.
You should only leverage what you are OK with losing entirely. Most people should not be leveraging their only home as investments. We are heading into some rough times and people will find out about that.
You would think so but it's often the opposite. The poorer you are the more conscious you have to be about money management so getting laid off may just be yet another obstacle life has thrown at you, business as usual.
Meanwhile if you've lived an easy life you may not have learned how to cope when the hard times come.
This literally happens every single time there is a big layoff announcement on HN; at this point it's completely predictable. People love these stories as a place to vent (not that I necessarily blame them), but I do find that these kind of stories always attract the lowest quality comments. E.g. "Why hasn't the CEO committed harakiri!" Which is always a bit sad to me because I think the biggest mistake (especially in highly paid industries) is to think that a layoff is the end of the world and the absolute worse possible thing that can happen to someone.
we've seen so many of these stories, the same narratives (which are just that. words, not actions nor plans), and no further insight on their real reasons.
What is there to say or inquire about? The human element is way more important.
>to think that a layoff is the end of the world and the absolute worse possible thing that can happen to someone.
Short of sickness or death of a loved one, I struggle to think of anything worse than losing my livelihood out of nowhere.
I guess if I owned a house and it burned down? I can insure that at least. Job insurance seems to be dead these days.
Car accident? if no one was hurt that's much less worse. I can rent a car until insurance figures itself out.
What kind of dismissal is this? Have you ever been laid off? I'm genuinely wondering what your mindset here is when you made this comment.
We've learned it because we've seen this movie many times over the past couple of years (the catalyst perhaps being Musk's decimation of Twitter): it's become acceptable -- and perhaps not only acceptable but expected -- to suddenly cut a significant percentage of your workforce in order to "drive growth", with some BS platitude (the details of which vary a bit but they all read pretty much the same).
It's not venom, it's an appropriate response by workers to the "shareholder-value-at-all-cost" race that the industry finds itself in; an industry that has prided itself, and often built companies on, values that are the opposite.
That, and the fact that CEOs have no accountability for these decisions.
I saw the venom the other way. People are losing their livlihoods and I see such dismissals as
- "You shoud have saved more money"
- "oh well you'll get a better job soon" (have not seen the job market the last 2 years)
- "They were probably low performing workers anyway, they deserve it"
- "It is what it is. Business is going to business"
- "The CEO's are just doing their job"
I hate it. We can't even come together as a community, which consists of many tech workers, to empathize with our peers. No wonder we can't rise up and bring about change from grassroots.
Just off the top of my head: every engineer should have 6+ months of savings. Market isn't great but our salaries can help build those savings easy.
If I had more time, I would love to understand the fss market better and also what impact ai is having there. I don't see a Q3 earnings report from Dropbox, but as others have pointed out in other comments, Dropbox seems to have been doing fine financially.
> Dropbox seems to have been doing fine financially
Not really.
The issue is Dropbox's core product is heavily commodified (Cloud File Store for Enterprise and Consumers).
Dropbox's EBIDTA is much lower than peers in the Software industry making it a much less attractive investment - even public companies need to attract investment.
Furthermore, Dropbox has missed out on multiple trends that it had the right ingredients to execute on, such as DLP, DSPM, AI Search, AI-leveraged Business Tooling, etc.
It's not that Dropbox didn't try building these teams - they did and I know plenty of people who were hired to work or lead these initiatives - but tech is competitive and they got outcompeted.
At some point they have to initiate layoffs in order to retool internally and concentrate on the BUs that actually generate outsized revenue along with strategic bets that can help make Dropbox more enticing.
> every engineer should have 6+ months of savings. Market isn't great but our salaries can help build those savings easy
Pretty much. Layoffs have always a thing in the tech industry.
And compared to previous cycles (early 2000s, 2008-2013), the current job market is fairly standard for mid-career.
I think this tech downturn is just the first one that a lot of 2011-22 grads went through and it makes them feel like it's the end of the world.
Keep saving, keep upskilling, and keep networking - these are what save you when we all (inevitably) get laid off.
"every engineer should have 6+ months of savings. "
I did. Even stretched it out to 9 months (getting a freelance gig out of nowhere helped). But it's been 13 months with no full time work.
>Market isn't great but our salaries can help build those savings easy.
It did not. Not everyone's making 300k at Google.
>If I had more time, I would love to understand the fss market better and also what impact ai is having there.
nothing short term, but the usual suspects come about as usual. Trendsetting from Twitter, ZIRP, tax code changes affecting how to amortize tech salaries, an anticipation of a downturn in the evonomy, and AI speculation (not really affecting tech, but other areas).
Those are each worth their own post, but this is againa topic talked about a lot . Since this has happened a lot.
And yes, this wasn't a layoff of necessity. That's the "venomous" part about it. Why Wouldn't I be mad at blatant greed?
I think the real learning here is that the company is still around even though they are sort of not in the popular zeitgeist at all anymore and there are so many other tools that does what they do.
People come in two flavors: conflict theorists and mistake theorists.
Conflict theorists think that every event is a result of power struggler. So if someone gets hurt, someone must be punished for that.
Mistake theorists think that the world is complex and sometimes bad stuff happens because most people operate with good intentions most of the time. Often, that means no punishment needs to be metted out.
To mistake theorists, conflict theorists look like ideological blood thirsty savages. To conflict theorists, mistake theorists look like enemy troops.
This is a gross oversimplification but it always shocks me to see how much more conflict theorists there are on hn now than before. So many comments here blaming the CEO or capitalism, most of which are going off extremely scant information.
> Actually, I know why. It's because they have too much money and when you have too much cash, you start splurging without thinking and then one day the chickens come home to roost.
This is an incredibly uncharitable and shallow take, on the level of that comment many years ago that said something along the lines of "what's so interesting about Dropbox? It's just rsync, I could build it in a weekend".
We don't operate in a perfectly legible world, especially more so when it comes to people. It's all bets and risks and whatnot.
If you or anyone has the power to create perfectly aligned and efficient organization, I'm waiting here to see you build large multi-trillion dollar companies. Let me know how it goes.
My understanding is DropBox was trying to transition from sync and share to being a multi-product document-centric company (look at acquisitions like HelloSign).
One possibility is they staffed up a bunch of projects on bets that ultimately didn’t turn into viable products, and are now pulling the plug.
More like the cloud sync functions out of the box on Google, Microsoft and Apple products caught up in features and already got good enough for the customer base of these to not bother paying extra for Dropbox no matter how much better they would have been. See Evernote.
It's difficult to go against Apple, Google and Microsoft when they're vertically integrated and can squeeze you on all sides offering an OS, email, browser, cloud sync, document editing, etc with seamless integration between them, while you're just a cloud sync service on their OS. You don't have any moat, while they do. There's no way you can compete with them from that position unless the government were to break up their vertical integration for anti-competitive practices.
I think that is why Dropbox has been trying to diversify their offerings. They know as well as the rest of us do that cloud storage that's only cloud storage and not much else will have serious trouble competing with cloud storage that you also need to have to work conveniently with Google Docs, or Office 365, or whatever.
But, as parent poster pointed out, taking on that new work requires hiring people to do it. But that's expensive, and those new products need to start generating revenue quickly in order to cover the increased payroll costs.
>For me, Dropbox's moat and USP is that they make all of their money from file storage, giving me some confidence that they'll ensure it keeps working.
To me that's now become a red flag with these companies. Not speaking of Dropbox in particular but all these start-ups from the past that offered a free new innovative product/service for Android/iOS went to shit soon after Appel and Google copied and integrate similar functionality into the OS out of the box, leading to investor money drying up and the company suddenly paywalling and gouging existing users to make money to survive. Look at Evernote, LastPasss, Cerberus, etc. but also Amazon, Netflix, etc, enshitification galore.
Google and Apple are less likely to do that since they already make more money than God and tend not to want to fuck up their reputation just to squeeze a few more bucks from their users.
That's why I don't trust these small app companies anymore, since they'll get squeezed out by Apple, Microsoft and Google, and enshitification will ensure. The app is good in the beginning for a few years when VC money is abundant and their goal is user growth at any cost, but after that suddenly once you're locked in, you get paywalled, as the company tries to squeeze more money from you so VCs can get their money back. Rinse and repeat. So no thanks, I got burned a few times already.
The problem is that it’s unclear consumers actually ever wanted Dropbox to become any more than a sync and share company, or to deal with the resultant complexity that that will bring to what has been a beautifully simple product. But they had to do that to justify Sky-high valuations.
I think what people forget about layoffs is that all those "excess" employees who have been there didn't sit around doing nothing during the time they were there.
Those 20% of Dropbox staff wrote a bunch of code, made a bunch of sales, and did a lot of other tasks that will have an impact even after they don't work there anymore.
Even though they are being laid off, their contributions still have a positive impact on the company. Even the government treats it this way from a taxation basis: software that is written by engineers is treated as a depreciating asset that is amortized over 5 years.
In other words, if I write some code that consumes $100 worth of my labor, that engineering work is considered by the IRS to be an asset to the company with book value from now until 5 years from now. If I'm laid off, the company still has that $100 asset on their books, which depreciates over 5 years.
It's perfectly normal for a business to plan out their future based on uncertainty and risks. If they only hired people they knew 100% they would need forever, they'd miss out on a lot of opportunities.
Extending this logic far out enough and we could say ridiculous things like "How could IBM be so irresponsible to hire hundreds of thousands of engineers to make business mainframes when their marketshare will dwindle to a sliver in 40 years?"
The truth is that businesses need the employees that they need at a point in time, and that number is constantly changing.
> The truth is that businesses need the employees that they need at a point in time, and that number is constantly changing.
Another truth is that we've collectivly decided that all people must be working in order to "earn" their right to exist. So anytime there is a large layoff like this, there are a lot of new stories about people relocating, making major changes to their lives, some for the better, some for the worse, and some for the absolutely devastaing.
One must not forget that these 'human resources' are more than just a number.
I'm all for better protections for workers, and I think that the US should make companies give employees more notice, or alternatively make unemployment benefits a program that is more automatic, a full 100% of salary instead of being capped, and biased more toward the employee. I.e., I think a company should have to prove to a judge that an employee was fired with cause or quit voluntarily before the employee loses their benefits.
I totally agree with the idea that the benefits of at-will no-notice termination employment are lopsided in favor of the company, but the flip side of that arrangement is that it's very easy to get a new job in the US compared to many other places. It's easy to be hired on a short conversation and a handshake in an at-will environment.
Depends. If those employees truly are excess and they haven't been doing much for the past couple years, they might be just producing tech debt. Cancelled projects and migrations have negative value. I doubt this entire 20% was made redundant overnight, which means they haven't been valuable for some time.
> This is an incredibly uncharitable and shallow take,
So is yours.
> We don't operate in a perfectly legible world, especially more so when it comes to people. It's all bets and risks and whatnot.
What bet was dropbox taking by overexpanding their workforce by 20%?
> If you or anyone has the power to create perfectly aligned and efficient organization, I'm waiting here to see you build large multi-trillion dollar companies. Let me know how it goes.
This is an interesting statement. Dropbox is a single digit $billions company, not trillions.
> What bet was dropbox taking by overexpanding their workforce by 20%?
When asking this question, I think it's good to remind ourselves how much we don't know. We don't know if they overstaffed in a push to expand their business that didn't work out, we don't know if the had an older operating model that went from "efficient" to "inefficient" as scale and market dynamics changed. We don't know if advances in productivity to tools, or changes to major client accounts, impacted their staffing needs. Determining whether one is "overstaffed" is a multi-factorial determination that can be false one month and true the next.
Set aside whether it's uncharitable to just assume management oversight or idiocy - it's hubristic. Having said that, it doesn't mean the assumption is wrong, it could be exactly right! But it might not be.
The OP made strong statements with weak backing. Their statements were also placing blame. Your profile says you're an SRE--can you imagine a post mortem with that kind of attitude?
> Honestly, I would not hire a single manager from these big companies because they operate in an environment where they're playing with monopoly money and don't know what reality is.
In part, to unpack why part of this glib take is missing the complexity, "don't know what reality is", is that finding reality is slow and costly.
Perhaps your team provides a platform which is used internally by several other teams building various products. It supports a bunch of use cases, but it's hard to evaluate the actual ROI of the platform you provide, both because no one knows how much better/worse those products would have been without your platform. Would they have taken months longer to implement? Would they have not been possible without spinning up a team like yours?
Further, some of those products actually are used by paying customers, and others are still in development. Of the products used by paying customers, it's unclear which they would actually pay to use vs which they use because it's available in their subscription basket (e.g. is Dropbox Paper making money or is it just that some Dropbox customers use it but would pay the same sync subscription if Paper was killed?). Of the products that are not yet in customers hands, how should you value them? If your small team supports multiple in-development products, that must be worth something even if they're not revenue-producing yet.
Similarly, suppose you're a manager who runs a team building a product which has dependencies on multiple platform/infra teams -- do you really have visibility into the real costs that your team's requests create? Can you really know the ROI of your team, to guide choices about various investments?
This kind of ambiguity means that even when leadership wants to see which teams are really contributing value and how much, it's quite difficult to see. Teams may optimistically estimate their own value because they cannot see all of the costs to which they contribute, or because they cannot see which revenue-affiliated use is actually valuable.
Open the "More" menu in your Dropbox interface and I think you may be surprised at how many different products they have.
I am sure they're not trying to be a Microsoft of Google, but they're trying to make a niche in document handling, file sending, password management, a lot of those little things that are something of a pain for many businesses.
I think if you compare what Dropbox is offering at $15/user/month to Microsoft 365, there are a bunch of things that Microsoft isn't really covering or isn't covering as well (and vice versa, to be fair). For example, the ability to take e-signatures, document watermarking, facilitating out-of-organization file transfers, etc.
I also think they compete quite well with Amazon Drive, considering that Amazon Drive was discontinued.
My point is that this is probably the case for most users; the "more" doesn't mean anything because it's some functionality created by underemployed product managers rather than things that customers actually need/want to pay for. If you have to point out "hey, look here under this 'more' menu", then it's not part of the primary value proposition for the product and not why someone would pick that product. Sure, it might be that it is useful for some subset of users, but that you need to wave people down to show them that value means that it's probably not that valuable.
The amount of businesses whose target audience is “most users” is very small. You might get lucky and be a Microsoft or Apple but almost every other business has a very specific type of customer that they want.
The other thing is that the most popular features aren’t necessarily the most profitable ones.
Dropbox doesn’t make money on the millions of people with free accounts, and they are selling commodity storage for their paid users at thin margins. But a product that can solve business pain in a unique way can command better margins, which is why they are getting into other businesses like document signing rather than just sticking to selling bulk cloud storage.
At first, I thought this was satire, but then the joke never landed. The author cites "Modern Physics, 8th ed." but then ignores everything in the book. This posting is fantasy in the same vein as "we can have personal jetpacks for everyone by 1995."
There is a lot of money to be made in air travel. If commercial flights were cost-effective, they would be operating today at scale. It isn't a regulatory issue; it's strictly economics. If someone could demonstrate the technology the author describes, indefinite amounts of money would flow to them. It hasn't happened. It's not happening anywhere in the world.
Finally, the author talks about building massive fleets of airplanes as though it is a trivial thing. A significant portion of global fuel consumption goes to aviation today. The author conveniently sidesteps the issue of producing enough fuel and managing the environmental impact just to keep these planes in the air. Why was this even posted to Hacker News?
My very uncharitable take, but one that I have to entertain as potentially true, is that this is the exact skill some teachers want to deprive their students of.
It can get tiresome—but, reading as an adult, may have been one of the more interesting parts of the book as I was familiar with the Ahab thread 100x over.
It's almost as if there are beautiful, deep lessons being passed down by people who lived before us.
I find the authors argument unpersuasive. I was one of those rebellious teenagers growing up and it was exactly in Dostoyevsky and Arthur Koestler and Umberto Eco that I found refuge and companionship. Maybe because they were so different than me and my peers, they offered me a glimpse into different ways of thinking and seeing.
