
Lambda School lays off 19 employees - dsr12
https://lambdaschool.com/the-commons/a-note-from-our-ceo-company-update
======
benatkin
For an idea of what percent of employees this is:
[https://lambdaschool.com/the-commons/2019-a-year-of-
incredib...](https://lambdaschool.com/the-commons/2019-a-year-of-incredible-
growth)

They added 125 in 2019, and there were 40 at some unknown time during 2018.
That would mean at least 165. There's a photo which was taken sometime in 2019
while the 125 were being added, which may not include everyone. They may have
also hired more in the first couple months of 2020. It seems they had
somewhere between 165 and 250 employees. This would mean the 19 employees are
between 7.5% and 11.5% of their workforce.

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ChefboyOG
I wonder how these mass layoffs are going to affect junior level hiring.
Obviously, they're going to have an effect across all hiring, but the
particular dynamic is interesting to me.

I have friends who worked in investment banking in 2008, and several of them
have talked about how the industry (or at least their perception of it) became
more "diamond-shaped." By this they meant that past the initial hiring
freezes, entry-level hiring eventually picked up as normal, but that senior
level promotions took a while to pick back up. There was a glut of experienced
VPs (more of a mid-level role in IB than in engineering) who were making
lateral moves between banks—not competing for entry level roles—but none of
them were moving up to higher positions.

~~~
alextheparrot
Ive already heard personally about internships getting cancelled from multiple
sources, so there might be second-order effects as well where the junior
engineers coming right out of college are less prepared.

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lwb
Why is education affected negatively by COVID? It is the last sector I would
expect. I'm sure many are doing fine but IIRC Ryan Florence had to lay off his
React teachers as well.

~~~
tempsy
New grads are now competing with a bunch of laid off engineers with experience
for open roles. I would imagine it would be much harder now to find a role
than before, and Lambda doesn’t get paid since it runs off the ISA model.

If Lambda tries to sell their ISAs, which they admit they sometimes do, the
buyer is going to request a much steeper discount now than before if they are
willing to buy the loans at all.

~~~
dataminded
I remember interviewing candidates in 2008. Experience can be bad, experience
can be irrelevant and employers can tell the difference between interest and
desperation. I talked to more than one ex-Director/VP/CXO for entry level help
desk roles. Some experienced candidates will do well but a non-trivial number
of them will find themselves unemployed now and unemployed later.

------
tempsy
The bootcamp model doesn’t seem like it would work well in a recession since
new grads end up competing for any open positions with laid off people with
more experience. I can’t imagine that Lambda would be able to place as many
students now as they did before all else being equal and if they tried to sell
their ISAs to a financing firm of course they are going to account for the new
reality and request a much steeper discount than they did before.

If you’re thinking of Lambda as a student then even if you don’t have to pay
tuition you still have all your living costs to think about. Probably does not
make sense do Lambda if you would otherwise be leaving a job and dig into
savings and then enter a questionable job market.

~~~
PopeDotNinja
The conventional wisdom used to be that many people would go back to school
during a recession. I certainly did that in after getting laid off in the tail
end of the dotcom bust. The timing of getting a degree during a normal
recession cycle might work out simply because 1 or 2 years after you start
school, you might be graduating when there's no longer a recession and hiring
has picked up again. If you go to a 3 month bootcamp during a recession,
you're likely to face a recession when finishing the program.

~~~
thaumasiotes
An interesting implication of this line of thought is that a lot of the value
of getting a degree during a recession is not so much the degree as having
something respectable to say you were doing with your time.

~~~
pm_me_ur_fullzz
I never thought of it that way, are you sure? I think people just thought the
degree would be there forever, but instead they are just paying it off forever
- in the states.

~~~
thaumasiotes
Being more explicit:

1\. In the hot market, you can spend multiple years getting a degree, or you
can spend a few months at a bootcamp. At the conclusion of either process, you
get a job. By hypothesis, the bootcamp provides as much value in terms of
knowledge as the degree does. (Just go with it.)

The bootcamp is much better, because you waste less time not having a job.
It's cheaper in cash outflow, but it's even more cheaper in opportunity cost.

2\. In the depressed market, you can spend multiple years getting a degree, or
you can spend a few months at a bootcamp. After a couple of years, the market
is no longer depressed, and you get a job.

By happy coincidence, if you got the degree, you go on the market at this
time, and you look employable. If you did the bootcamp, it's still just as
good, but you've been unemployed for a couple of years, and you look
unemployable. The bootcamp had a higher opportunity cost than the degree.
(Still lower cash outflow.)

In this case, the only reason you'd want the degree is so that, when you
interview for a job that chooses to hire you for unrelated reasons having to
do with the overall health of the economy, you don't have to admit to having
been unemployed. If the cash price of bootcamp is 20% of the cash price of the
degree, then this respectability concern is at least 80% of the value of the
degree. More, if you assume it's generally nicer to be unemployed than to be
studying for a degree.

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MatthiasP
Will be interesting to see if bootcamp grads are more affected by the
recession than your average CS college grad.

~~~
instagary
I would come down to who has more experience in their resume. A lot of boot
camp grads, unfortunately, cannot participate in internships because it's a
continuation of classes (no breaks), but I don't think CS grads have a
significant advantage assuming both prepared well and could get interviews.

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maximilianroos
> Today is a sad day, and people will react in different ways. However you
> react, those emotions are real, and they matter. This was one of the hardest
> decisions I’ve ever made in my life.

It's unfortunate when CEOs neglect to mention the difficulties of those they
fired — instead focusing on the the difficulties they faced in doing the
firing

~~~
earthtobishop
> However you react, those emotions are real, and they matter. This was one of
> the hardest decisions I’ve ever made in my life.

> I want to publicly say thank you to everyone who has worked at Lambda for
> what you’ve contributed. I know you’ve given parts of who you are to Lambda,
> and to our students. You are part of our journey. You are the reason we are
> here. Thank you.

He mentioned the difficulties of those who were fired by acknowledging that
their emotions are real, and that they matter. And that this was an
unfortunate decision he had to make. He also thanked them for all they have
contributed .

What else should he have said ?

~~~
woofie11
His quote was rather crass: "Today is a sad day, and people will react in
different ways. However you react, those emotions are real, and they matter"

There's a difference between "you feel sad you're fired" and "you'll miss your
mortgage next month, because no one is hiring, and your kids may be kicked out
of their school district as a result."

~~~
TulliusCicero
You seriously want him to bring up specific difficulties like missing rent
payments? Why would you want him to rub salt into the wound like that?

~~~
woofie11
No. I'd like him to acknowledge that this will put employees in a genuinely
difficult position, rather than just "I'm sorry people will feel bad." I
brought up specific difficulties to point out how the non-specific platitudes
downplayed them. You can be non-specific, while acknowledging the seriousness
of a decision like this one.

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keeptrying
19 employees seems such a small number that you can’t but think they could
have as easily not fired them and just cut everyone’s pay?

~~~
caseysoftware
Which is more demoralizing? Doing layoffs or cutting everyone's pay?

Doing a round of layoffs - _especially done respectfully_ \- can soften the
blow a little while requiring only senior leadership's buy in and some input
from managers. Convincing _everyone_ to take a 15% pay cut takes a ton of
coordination across the entire company and probably drives the rumor mill fast
and furious. And imagine being one of the people who says "no"!?

Further, with layoffs, you can choose who to cut. If people get demoralized as
you're negotiating pay cuts, the top people can pack up and leave.

I don't like any of it but it makes sense.

~~~
commandar
The company I currently work for made across the board 10% pay cuts this past
pay cycle. It has absolutely _demolished_ morale among the rank and file.

It's definitely contextual to some extent. We're in an industry that's going
to take a revenue hit, but the sustainability of the company isn't in
question. Doesn't help that the company could afford nearly a billion dollars
in stock buybacks in the last year, either.

I think one of the big takeaways for me is that it's burned any good will the
company had with a lot of its employees. I expect pretty heavy turnover once
hiring starts to thaw again and I'll likely be part of it.

~~~
onion2k
_The company I currently work for made across the board 10% pay cuts this past
pay cycle. It has absolutely demolished morale among the rank and file._

Whenever I've been at a company when jobs are made redundant the same thing
happens - everyone worries that their job will go if there's another round of
cuts and morale plummets. That usually pushes more people to find new jobs,
and it's ofter the people who are good because they can get new jobs more
easily.

There is no winning strategy for cutting costs.

~~~
barry-cotter
> There is no winning strategy for cutting costs.

But there are better and worse ones. Cut once and cut deep is close to as good
as it’s going to get.

------
737min
Prediction: Lambda will be out of business within 12 months.

~~~
sct202
If they go bankrupt I wonder if they'll sell off the Income Share Agreements
or if they expire or something.

~~~
troydavis
They’re already bundled and sold on the Edly ISA Marketplace:
[https://lambdaschool.com/the-commons/announcing-our-new-
isa-...](https://lambdaschool.com/the-commons/announcing-our-new-isa-
financing-blueprint-and-100m-in-new-financing),
[https://edly.info/investors/](https://edly.info/investors/)

~~~
jhwang5
Not to be cynical here but such a marketplace allows buying/selling human
capital... i.e. slave market.

~~~
troydavis
The ISA buyer doesn’t have any control of or influence over whether or how
much someone works (nor how much they earn). If the ISA seller wants to spend
their whole life relaxing on a beach, they can.

So, although you may not like ISAs, comparing it to slavery trivializes actual
slavery.

Also, it seems like you’re being cynical without realizing it.

~~~
perl4ever
I have no first hand knowledge of Lambda and maybe they're the worst thing
ever, but whenever I see a comment dripping with venom that doesn't even make
any sense to me, I think what on earth do these people think of conventional
rip-off for-profit schools that you pay up front?

