Substack Is Laying Off 14% of Its Staff (nytimes.com) 11
Substack, the newsletter start-up that has attracted prominent writers including George Saunders and Salman Rushdie, laid off 13 of its 90 employees on Wednesday, part of an effort to conserve cash amid an industrywide funding crunch for start-ups. The New York Times reports: Substack's chief executive, Chris Best, told employees that the cuts affected staff members responsible for human resources and writer support functions, among others, according to a person familiar with the discussion. The cuts are a blow to a company that has said it was opening up a new era of media, in which people writing stories and making videos would be more empowered, getting direct payments from readers for what they produce instead of being paid by the publications or sites where their work appears.
Mr. Best told employees on Wednesday that Substack had decided to cut jobs so it could fund its operations from its own revenue without raising additional financing in a difficult market, according to the person with knowledge of the discussion. He said he wanted the company to seek funding from a position of strength if it decided to raise again. In his remarks to employees, Mr. Best said the company's revenues were increasing. He noted that Substack still had money in the bank and was continuing to hire, albeit at a slower place, the person said. Mr. Best said the cuts would allow the company to hone its focus on product and engineering. Months earlier, Substack scrapped a plan to raise additional funding after the market for venture investments cooled.
Mr. Best told employees on Wednesday that Substack had decided to cut jobs so it could fund its operations from its own revenue without raising additional financing in a difficult market, according to the person with knowledge of the discussion. He said he wanted the company to seek funding from a position of strength if it decided to raise again. In his remarks to employees, Mr. Best said the company's revenues were increasing. He noted that Substack still had money in the bank and was continuing to hire, albeit at a slower place, the person said. Mr. Best said the cuts would allow the company to hone its focus on product and engineering. Months earlier, Substack scrapped a plan to raise additional funding after the market for venture investments cooled.
We're going to see more of this (Score:2)
I don't think the economy is getting better any time soon.
We're going to see more of this through the start of 2023.
Re:We're going to see more of this (Score:4, Insightful)
As companies drop overpriced tech talent, expect their earnings to move northward and we likely will see a stock market rally as dead weight is shed.
It's not limited to tech talent. Companies have had easy access to cheap money for quite a while now and have gotten too complacent -operating like they were venture capitalists: throw money at everything and expect something will pay off big enough to offset the losses.
What we are experiencing is a correction. Money is not unlimited, and not everyone deserves to be paid lots of money to do whatever they want. It just doesn't work.
HR and Support? (Score:1)
News? (Score:4, Insightful)
13 people got laid off at a small startup I haven't even heard of and this is news?
Re: (Score:2)
And it wasn't even done in any spectacular way, like after losing from the CEO at a game of foosball.
Re: (Score:2)
There are a lot of industry specific financial (Score:2)
analysts with substacks. It's like Odyssey or Patreon for blogs. People usually have a free tier/newsletter and a paid tier.
Free vs paid subscriptions (Score:2)