
After the Layoffs - juanplusjuan
https://42floors.com/blog/startups/after-the-layoffs
======
dewitt
Amazing how much of that post was about the CEO's personal relationship with
the layoffs, considering the #1 bit of advice in every comment on yesterday's
thread about layoffs was "whatever you do, don't make it about yourself." [1]

I don't know if it's good advice or bad advice, but the dissonance was strong.

PS: I still respect the CEO. The actions (severance, health care, references,
etc.) speak loudly, even when the words, no matter how heartfelt and sincere,
aren't always the right ones.

[1]
[https://news.ycombinator.com/item?id=9876009](https://news.ycombinator.com/item?id=9876009)

~~~
kylec
I think it's fine for the blog post to be about the CEO's feelings. I'm
assuming that when he actually broke the news to the employees he didn't dwell
too much on "you don't know how hard this is for me" and focused on doing
right by the people he was laying off.

~~~
protomyth
"I cried and many of them cried. It was emotional for everyone. Some were
angry and some were already focused on what to do next."

I would lean to believing the other way given this comment, but it is not
quite clear from the text.

~~~
mynameisvlad
Nothing about that indicates one way or the other, really. The whole thing is
pretty emotional, moreso in smaller companies where everyone knows eachother
and becomes a small family. The fact that he cried along with them really says
nothing about how he had given the news.

------
42floorshater
I don't want to be such a hater, but every time I see this company and this
guy posting something, it's not about what they do, it's about the trials and
tribulations of being a startup.

They don't seem to care - at all - about their industry, their space, whatever
their value proposition to their customer is. They just care about being a
startup. It's super annoying to be honest.

Weren't these the guys that famously wrote a blog post saying that culture is
everything, and that people that come to interviews in suits are automatically
denied?

~~~
missblit
> Weren't these the guys that famously wrote a blog post saying that culture
> is everything, and that people that come to interviews in suits are
> automatically denied?

[https://web.archive.org/web/20140618142018/http://blog.42flo...](https://web.archive.org/web/20140618142018/http://blog.42floors.com/interviewing-
at-a-startup/)

Not automatically denied. That's only ding #1.

You also lose-- _ahem_ don't win-- points for leaving the interview on time,
neglecting to bring a fancy gift, and failing to obsessively read the company
blog.

~~~
bshimmin
I think it's terrific that they post things like that so openly. If I were
ever going to apply for a job again (and I hope never to), I would definitely
read up about the company and read at least some of their blog posts. And if I
found a post both so intensely dim and so offensively exclusionary as the one
on archive.org that you link, I would immediately know that this was not a
company for me.

My personal favourite bit is sneering at the guy for saying "you can never
overdress for an interview" \- I can just imagine the poor candidate sitting
there in his suit, feeling horribly out of place amongst these imbeciles,
trying desperately to make light of his situation with that remark (it's
probably just what I would say myself, in fact) and unwittingly providing more
fodder for their asinine blog.

~~~
jackgavigan
It's interesting that they've removed that post from their blog. I just asked
Jason on Twitter why they removed it:
[https://twitter.com/JackGavigan/status/620915571052412928](https://twitter.com/JackGavigan/status/620915571052412928)

~~~
jackgavigan
His response: "because it was crap"

[https://twitter.com/jasonfreedman/status/620956827870720000](https://twitter.com/jasonfreedman/status/620956827870720000)

~~~
bshimmin
Now I feel slightly (only slightly) bad for using the word "imbecile".

------
jedberg
I've been at the receiving end of a layoff before. I guess I'm more rational
than most, because when it happened I went in and said, "yeah I'd lay me off
too, the current strategy here isn't working". I know the boss took it hard --
he couldn't come back to the office for months afterwards he was so depressed.

I'm glad that 42floors was decent enough to provide what sounds like a great
transition -- health care, severance, job placement, etc. That certainly helps
soften the blow and it's really only fair to those who basically changed their
lives to partake in the experiment with you.

I think it's totally fine to do an experiment that may end up with you having
to let people go, as long as you acknowledge that and take good care of them.
And plan accordingly. Don't call it off when you have no money left and then
use that as an excuse to screw everyone.

~~~
jakejake
I had to lay off two people when a failed venture ran out of funding by
surprise (the angel investor had committed to $x dollars per month for 6
months, but went back on the contract at month 4 - even though we had launched
the product exactly on schedule.) we were launching and raising funds when our
runway turned into a brick wall.

I felt mad because my team and I had worked crazy hours to pull off a miracle
and the reward was everybody lost their job literally 1 week after the launch.
I totally understand that raising capital has more uncontrollable variables
than programming - I have to admit I was a bit angry that the other end of the
company didn't meet the ass-kicking standard of the tech side.

I referred both guys to other jobs, one of whom took one of the offers. The
other was a master UX guy so I was extremely bummed to not have him on a team
with me anymore. He could get any gig he wanted in the blink of an eye, so it
was no great loss to him.

It really does suck on both sides.

~~~
jedberg
I'd say you had a valid excuse for not paying severance.

Also, I suspect you've learned your lesson to never accept investment in
payments, or alternatively, unless it's in the bank it doesn't count. :)

That was a pretty dick move on the part of the angel. Did they say why they
stopped paying?

~~~
jakejake
I was in the loop, but not personally involved in the financial details. I
actually didn't know we were being kept on a leash like that. We suspected it
was a turn of fortunes with the investor - some negative stock stuff had
happened in their area (oil). We had a contract but, it's not like we were
going to sue them with no money.

You'd think with a contract and a legitimate investor that you're ok, but it
really is all hot air until the money is in your account.

------
philbarr
This is a FAR better situation for the people being laid off here than in an
ordinary scenario. The CEO did what's right for the company, nothing wrong
with that, but at least he tried to do it in the right way.

My experiences of layoffs are:

1\. A job in a huge software house. The company didn't hit the 12% profit
margin it had promised it's shareholders, making a "measly" 10%. People knew
when they were being laid off when the person going round with some fold up
boxes dropped one at your feet and said, "pack your stuff". I wasn't laid off
at that time but plenty of people I worked with were.

2\. A minimum wage job when I was 19 years old. The owner calls us in and
sacks a bunch of us in one go, with a big fat "sorry". I asked what the
severance package was, since no-one else wanted to ask. He said, "erm,
er....", and when it became clear there wasn't one because he hadn't enough
empathy to even consider the proposition I said, "you can at least give us
some money to go to the pub." He laughed, others nervously laughed. I said,
"12 of us multiplied by a tenner each is £120". I eventually got £60 off the
miserable excuse for a cunt who had his new Aston Martin parked on the carpark
directly outside the window. (Yes I made sure everyone who got laid off got an
equal share of that £60 at the pub).

~~~
pgrote
" I eventually got £60 off the miserable excuse for a cunt who had his new
Aston Martin parked on the carpark directly outside the window. "

Why does owning an Aston Martin make someone a cunt? I am American and
unfamiliar with British cars.

~~~
mplewis
They're $80,000 cars. Having one means you spent $80,000 on a vehicle.

~~~
akerl_
Do British cars not support leases or loans? It seems odd to look out the
window at the car park and think you can judge somebody's whole financial
situation, and from that extrapolate how they should handle other peoples'
money.

~~~
philwelch
It's a conspicuous display of wealth either way; people can and do lease
luxury cars, but only if they're trying to look richer than they are, which is
still a cunt move.

~~~
akerl_
Obvious troll is obvious.

------
bbarn
I've been through this same exact scenario before, twice. Once as a manager
having to cut half my staff, another time as the leftover manager two years
later. Both times for the same reason. The company got expand-itis, and
started grabbing for more, more, more, and "hey let's be the pipes instead of
servicing the stuff coming in and out".

This is a classic example of overextending a company. If this new vertical was
that risky, then it should have been said every day to those people hired to
do this job. "This is a new venture for this company and if it fails we can't
support your role. Are you still interested?"

Oh, and the "I feel terrible" bit, as much as you may feel terrible, comes off
as insulting to those you are sending home - good severance packages or not.
If you really care about them, you give them complete transparency in what's
happening WHILE it's happening, and give them the chance to correct the ship
for you or get out. Holding on until you can hold on no longer and have to do
a massive layoff is a huge failure.

~~~
unclebucknasty
> _if you really care about them, you give them complete transparency in what
> 's happening WHILE it's happening_

To be fair, sometimes it's not always obvious that it's "happening". It can be
a pretty tricky timing thing, and sometimes you try to hold on a bit too long,
hoping to turn it around. But, maybe I missed a nuance in the post that you
gleaned, which gave a better picture of the timing here.

On another note, maybe I'm old school, but a CEO dropping a bunch of f-bombs
in a public forum just isn't professional, IMO. I think it's cool for
companies to be edgy and non-corporate, but using language that is generally
considered offensive shows a certain lack of appreciation for your position as
a representative of your company, board, partners, customers and other
stakeholders. This, as well as a lack of respect for an audience whose
sensibilities almost certainly vary.

And, the repeated use of it in the phrase "I f __*ed up " comes off as
overdone to the point of disingenuousness and, oddly, maybe even a little
narcissistic.

------
lemevi
> The night before the layoffs, after talking with my cofounders and the
> Board, I called up each of the people who were going to be invited to remain
> with us and told them what was about to happen.

So the people who were not getting laid off found out before those who did?
And they knew who was getting laid off too? That seems kind of wrong to me.
Like I get that managers would know that, but why would everyone know that? I
think the people affected by the layoffs should be the first to know, right?

~~~
Ensorceled
Why? Seriously. Why do you feel that way?

It's already going to be a bad day for the people being laid off, why make it
a nasty surprise for the people who are not being laid off as well?

~~~
lemevi
I think I feel that way because my job status is incredibly personal
information. For the person sitting in the desk across from me to know that
I'm not going to have a job at the end of the day before I do strikes me as
incredibly invasive. It also gives them an opportunity to tell people outside
of work and to use that information against me before I even know about it
should I happen to be in a dispute with them for any reason. I should know
before someone not in my reporting chain that I'm going to lose my job, not
after.

~~~
pvg
They're going to know one way or the other very soon. The focus of the CEO in
this situation is continued operation and minimizing disruption - the people
they plan to keep are more important for that and it's often necessary to get
them on board before they start seeing their ashen-faced friends and coworkers
collecting the stuff on their desks. It's not optimal for anyone but despite
what this particular CEO wrote, the reality is the remaining people are the
top priority.

------
jriordan
I think that these layoffs were made significantly less burdensome because of
who was laid off -- i.e. real estate brokers.

Almost all real estate brokers in the non-tech world work as 1099 contractors
anyway, paid completely on commission -- no salary and no benefits. This has
always been the "standard" in real estate, and pretty much everyone gets into
the brokerage business knowing that. Sure, there have been some innovative
exceptions over the last couple of decades (limited-service residential
brokerages like HelpUSell or Assist2Sell, for instance), but full-commission
is the general rule.

So... you are a broker and you take a salary or semi-salary job with a tech
start-up... You ought to realize that you are stepping outside the way your
business normally operates. You are much more likely to be standing on shaky
business ground, much more likely to be discarded when the boss changes his
mind about the deal he signed (which happens in real estate _all the time_!).

Laid off from that company with the snazzy HN post "42 Floors is Hiring!" from
a short time ago? If you are a competent broker, you have a career path
available that has always been there and will be there for the foreseeable
future-- back to being a commissioned salesperson. If you can produce sales,
you can get a new spot quickly and without much hassle.

If it were any other demographic, the boss would have had a harder time.

------
bane
I've survived layoffs 3 or 4 times (depending on how you count them).

I survived because I had some specific value to the company that the laidoff
employees didn't have. This was a plus.

I now knew that I was a better candidate for better jobs.

So as soon as layoffs started, in my mind, I was already out the door, only
now I had time to look for a better, more stable, job.

Each time, I found such a job and quickly left.

Side note: the first time I went through layoffs, people were zombies
afterwards, even though most of the people who were gone were dead weight.
There were enough people who were also let go who were covered under contract
that we knew that there was the chance of more to come.

So it made sense to look for someplace else to go.

~~~
xirdstl
I've survived also, but deep down feel cheated of missing the incredibly
generous severance. Oh, to be incompetent ...

~~~
aswanson
Generous severance, hilarious. At one gig I worked they gave the dead weight
something like 6 months pay 4 months medical and quite a few refused it while
some of the more competent employees were volunteering to take it, and being
denied the opportunity. It was a SNL skit situation.

~~~
mcguire
"For those of you who choose to take it, the severance package will be...."

"Wow. Can I take it?" says I.

"No, you're a co-op."

------
shawnee_
The brokerage model failed because the brokerage model itself is inherently
flawed as a business model. Nowhere does this become more apparent than in the
real estate industry. Its natural inclination is toward Bernie Madoff-like
pyramid, where consolidation and cartel-like cooperation among "a few" (the
Brokers and Agents) hurts "the many". Agents are forced into paying brokers
for the "privilege" of association and access to the MLS... agents pass those
costs on to clients by forcing those clients to sign on the dotted lines
("closing the deal"). Clients end up paying inflated commissions, as each
person (or entity) up the chain takes their cut in larger and larger portions.

42Floors was trying to be the Redfin of commercial real estate? Well of course
that doesn't solve the problems created by the existence of brokerages,
especially when we're talking about _renting_ or _leasing_ a space, where ROI
is already ridiculously negative from the get-go. Where commissions are just
unnecessary garbage expenses. Why would it ever have been a good idea to
involve brokerages at all?

 _We’re going to step decisively away from that model now and focus only on
providing a great search experience. We’ll leave the deal closing to the
professionals.

Over time, we’ll develop our new business model, which will be based around
premium listing opportunities for those that want greater exposure to tenants_

So the idea is to package the potential client list from a "better search
engine" and sell it to those poor, struggling brokerages like it's insider
information? Sounds like the MLS on steroids. Doesn't make much sense.

------
jftuga
Extending health care coverage for three months was extremely nice of him to
do for the people he had to let go. I can't imagine being in that situation.

~~~
xacaxulu
Great thing about having an EU passport is that this situation doesn't even
come up.

------
chadnickbok
The part of this story I liked the most was the team's reaction; gathering up
their desks into one part of the office, and breaking down the old desks that
were now unused. Seems like a kind of mourning process, and makes me feel like
this team must be really special to be a part of.

------
gk1
Couldn't help but notice that after such a serious post, he still ended with a
link to the homepage that's entirely for SEO purposes.

(The link to the homepage in the final paragraph is phrased intentionally to
boost search rankings for keywords like "search for office.")

~~~
drinkzima
Linking / link-text from your own domain doesn't yield any SEO benefit, so
he's really just trying to redirect traffic from the post to folks interested
in office space (or exploring the site).

~~~
gk1
Yes it does. Pages are ranked based on both the domain's merit and the
individual page's merit.

------
dandanisaur
I love the transparency here, especially for the situation. Maybe this could
be good for the people who were laid off (closure?). Taking good care of your
employees even after they are gone/admitting your mistakes goes way farther in
marketing than some think.

------
Simulacra
I work for a company of 41 teleworking employees, and we have avoided
42Floors.

We think they offer a great service, but we disagree with the CEO's attitude
and view of his employees, and the world. This concern kind of began with the
black hole phone number for recruiters. It seemed like overkill, and kind of a
dick thing to do.

Sometimes just because a company offers a great service is not the best reason
to use them. We disagree with the CEO and his attitude, so we chose not to
ever use their service.

~~~
B_Sutherland
Same here, when we were looking for a new office last year, I knew about 42
floors but the limited information I knew about the ceo and the company was
enough for us to steer clear of them. Im still not sure what great service
they actually offer, its basically Craigslist for offices, not any different
than Craigslist itself.

We've had great luck finding both our offices on CL and I'd recommend it to
anyone looking for office space then have to stroke this guys ego anymore.

------
justonepost
He should have spent time talking about the severance. Honestly, if I was
going through a layoff, that's all I'd care about at that point.

~~~
seiji
_spent time talking about the severance._

Often severance can be negotiated on an individual basis. Typically you start
with some base amount (4 weeks + 2 weeks for every year at the company), but
that can vary for different roles. e.g. when a CEO is fired, they typically
get larger severance packages than bottom-of-the-org-chart employees (because,
try putting out a job request: "Will be CEO for food." World doesn't work that
way.)

Also, severance payments+benefits aren't some magic gift from a company—it's a
legal contract giving you monetary compensation in return for things like not
disparaging the company in the future. Any time a company tries to bind your
future actions outside of employment, you have room for negotiation.

~~~
MatthewMcDonald
How do you negotiate your severance? I don't see the personbeing terminated as
having much leverage. Are companies really that afraid that you'll bad mouth
them? I'm struggling to imagine that conversation:

"Here is 8 weeks compensation, in return for signing this non-disparagement
agreement"

"No, I want 12 weeks compensation or I won't sign your agreement"

~~~
seiji
Yup, basically right. It is still a legal document too. Typically severance
documents will have a deadline to be signed which is _after_ your official
termination date. You're fully entitled to _not_ sign anything at your
termination so you can consult with counsel. If the stakes are high enough, a
proper employment lawyer can advise you on proper next steps given your
severance documents (what you're entitled to for their asks (non-competes?
confidentiality? agreeing to company-run arbitration in any future matters?,
etc).

But, once you counter, they have the option to re-consider their entire offer,
including perhaps withdrawing it completely if they consider the transaction
no longer worth it. Then you're still dismissed and get nothing.

All of this is assuming policies under american at-will employment. Any other
contracts or government regulations can alter matters. Some countries even
have mandatory severance of a year or more when fired, but those countries
tend to not have great economic growth prospects (that's where Mitt Romney
once said "I like being able to fire people" with the implication of otherwise
dead weight just sits around knowing it can do nothing and still get paid).

------
davidgrenier
"and we supported them all the same."

What does this mean?

"I wouldn’t fault them if they chose to leave."

What would it mean if you did?

~~~
comrh
Nothing, it just sounds good.

------
kriro
I don't get all the bad sentiment. It's written respectfully and he clearly
assigns blame to himself. I completely disagree with the whole "it makes
people that got layed off feel worse so don't post it"/"this is too selfish"
line of reasoning. He's a human being, too. It's probably therapeutic to post
his point of view.

And personally I'd rather read this blog post after being layed off than
nothing at all.

+it seems like they handled the layoffs pretty well

~~~
peteretep

        > he clearly assigns blame to himself
    

I found the amount he said "it was all my fault" over and over again to make
the whole thing sound insincere, but I guess there's no pleasing everyone.

I've only fired people before, never laid people off, but where I'm from the
process is long and drawn out, and you have many many meetings that need to
focus on a person's failings. Being able to say "it's not you, it's me", and
sending someone on their way with generous severance sounds like a bucket load
more fun than having to document - in excruciating detail and face to face -
why someone you like as a person is incompetent and needs to go.

~~~
philjr
That's a different dynamic. Consciously managing someone out is very different
than taking potentially star performers and laying them off for nothing you
can attribute to them.

------
geuis
This is a great way to handle a bad situation.

------
ElComradio
tl;dr summary: "We figured out that we will still need to hire in the future,
so we crafted this post to get the message out that it's ok to still come work
for us- should things not work out again, you can rest assured we will feel
bad again."

------
jakejake
I went through a layoff round once. The company was about 40 people and I
worked in a small room with 3 others, including my supervisor to whom I
reported. Everyone being laid off got notified in a private meeting at once.

Everybody but me in that room got laid off and the next day I was in the
office by myself with no instructions, no tasks and nobody to report to! I was
a young guy without a ton of experience so it was bizarre and I didn't know
what to do.

I did busywork for about 2 months until I joined one of my former co-workers
at a new place. Two weeks later the former company shut down, letting
everybody know by posting a sign on the front door that the business was
closed.

------
codeshaman
It never gets any easier!
[https://www.youtube.com/watch?v=rjN6xh8nsf4](https://www.youtube.com/watch?v=rjN6xh8nsf4)

------
Taek
Were the employees aware of the risks of their role? Did they know that
success was uncertain and that failure would mean termination? Did they know
their severance package when they agreed to take on the risky role?

If the answer is yes to all of these questions, than no wrong was done. It's
just business, and they knew what they were in for. The company did the right
thing.

------
rmason
I've both had to lay off people and been laid off myself. The former, believe
it or not, is much harder than the later.

I know what is going through his mind when he spoke of breaking down desks
because I've had a similar experience.

If there's a bigger gut punch for an entrepreneur, I don't know what it could
possibly be.

------
sytelus
While this sentiment and gesture is appreciable, this is also a potential
example of rackless irresponsible hiring. When you hire people, you better
damn make sure there would have something to do for them in foreseeable future
as much as possible. Otherwise, go hire contractors. There is always some
risks involved for employees however you don't want to bring in ton of people
just to execute on one specific strategy with no backup plan if that strategy
failed. Hiring should be sustainable in the sense that company should be
making enough money to support all that extra hiring. If project A failed, we
can start working on project B and so on. If that is not the case, candidates
should be informed at the interview that if the project that they would be
working on fails then they would be out of job.

~~~
rgbrgb
FYI you're probably getting downvoted because of gratuitous negativity, an
ungenerous reading of the situation, and unsubstantiated moral claims. It's
pretty hard to read the future and the CEO in question fully admits he fucked
up.

~~~
pbiggar
But don't forget, when you write a piece about one of the hardest times in
growing your business, for the benefits of a community of people who could
really benefit to learn from those who have been through it, when it's
possibly the hardest thing you could ever write but you do it anyway because
it's important, nevertheless, someone on HN will shit on you for doing it.

~~~
sytelus
It's one thing to be "negative"/"shit on it" and quite another to be direct
and objective. I feel there is a new fashion in our industry where "I screwed
up" emails are becoming quite common. In fact it is being expected from every
leader who made mistake like Japanese want CEOs to publicly cry. The problem
with this whole new fashion is that these tears/"I screwed up" emails are
often empty and/or has no objective value other than asking for forgiveness.
These emails are starting to almost look like template without any actual
retrospection about real root causes and what someone else should do
differently in future. In 42floors post, that's exactly the problem: there is
absolutely no retrospection about what he could have done differently or what
others should do differently. It's just plain and simple "I screwed up/it was
the hardest thing/it hurts my heart" template. It's almost as if these leaders
are suggesting that it was just bad luck, here's my tears and now let's move
on. While all these regret and emotions are commendable, I fail to see single
thing that CEO has mentioned as his learning on what he could have done
differently. From his post my interpretation was that they hired whole bunch
of guys to execute on single strategy, without long term feasibility and
without disclosing the risk that failure of that one strategy would mean loss
of jobs. Now that's something they could have done differently.

------
xacaxulu
> I cried and many of them cried. It was emotional for everyone. Some were
> angry and some were already focused on what to do next.

I don't find this behaviour particularly galvanizing in a leader. Your
feelings and tears aren't worth much to me but your business acumen is. I'd
prefer you spent more time analyzing the business strategy that apparently
lacked careful scrutiny and cold logical evaluation so we could have avoided
this situation altogether. Give me the Steve Jobs and Larry Ellisons of the
world so we can stop the group crying/healing session and get back to work
innovating and generating wealth.

