9 ms·

Flexport slashes 20% of global workforce over weak 2023 volume forecast

192 points by drone 4y ago

paxys 4y ago
I have been badgered by their recruiters multiple times a week through the last 2-3 years. No doubt they grossly overhired during that period.
maldeh 4y ago
Barely two months from their announcing a hiring spree... https://www.reuters.com/business/logistics-startup-flexport-plans-hiring-spree-double-engineers-2023-2022-11-02/ https://www.reuters.com/business/logistics-startup-flexport-...
- deleted 4y ago
  [deleted]
- ec109685 4y ago
  They’re one of the biggest job promoters here, so it will be odd not seeing their jobs show up for a while. Flexport always seemed to be hiring.
  - pchristensen 4y ago
    You’ll still see the jobs. Flexport is still hiring many software engineers. Source: I’m a hiring manager for software engineers at Flexport.
- JamesAdir 4y ago
  A way to lower salaries. Fire the expensive ones, hire cheaper employees.
msoad 4y ago
I don't know what Flexport is, all I know is that it was the only jobs ad in Hacker News for a long time
- amalgamated_inc 4y ago
  I think it's that guy typesfast?
- deleted 4y ago
  [deleted]
- mattigames 4y ago
  At some point I wondered if flexport had bought hacker news or something like that to be seeing their ads so frequently.
  - dilyevsky 4y ago
    As yc company I believe you get certain number of these posts for free. I think they were just one of the very few who was still using them
  - jacquesm 4y ago
    No, Pachyderm bought HN.
    - myth_drannon 4y ago
      Funny, it's one of these companies that screams "we are hiring!" everywhere but looking at their Linkedin employee growth it's basically flat for more than a year.
- alismayilov 4y ago
  Same here. When I saw the company name, I remember that I was seeing job ads from this company on HN for a long time.
- ProAm 4y ago
  This is the guy that got famous during the pandemic for suggesting ports stack containers 3 or 4 levels high vs the standard of 2 [1] [2] Turns out 2 is just fine. [G] https://www.npr.org/2021/11/03/1051773672/a-look-at-whats-causing-shipping-bottlenecks-from-the-entrenched-to-the-absurd https://www.npr.org/2021/11/03/1051773672/a-look-at-whats-ca... [H] https://news.ycombinator.com/item?id=28957379 https://news.ycombinator.com/item?id=28957379
72f988bf 4y ago
The original source seems to be posted at https://www.flexport.com/blog/flexport-co-ceos-note-to-employees/ https://www.flexport.com/blog/flexport-co-ceos-note-to-emplo...
- CityOfThrowaway 4y ago
  Interesting that they say: > At Flexport, 2023 is going to bring extraordinary velocity – we are in the process of doubling our software engineering talent and moving to single threaded business organizations to build world class products faster, and we will continue to invest in delivering best-in-class operational execution for our customers. Looks like they are laying off non-tech workers who they have made (or will make) obsolete through automation
  - globalise83 4y ago
    moving to single threaded business organizations What does that even mean? They are only able to do one thing at a time? Doesn't sound like a recipe for business success to me...
    - panda88888 4y ago
      Probably removing redundancy in the business flow process path?
    - JimtheCoder 4y ago
      "They are only able to do one thing at a time?" To be fair, many new businesses cannot do one thing at a time, so maybe singular focus is a good thing at this stage...
    - paxys 4y ago
      Narrowing focus is often a good thing for companies.
    - makestuff 4y ago
      Dave clark brought this from Amazon. At Amazon they call it "STLs" or single threaded leadership. Basically you assign one director/vp/etc. to the business, and they are responsible for PnL/success. It isn't that you do one thing at a time as an entire company, but your org is focused on one thing. For example, maybe there is a director who runs an org in charge of international freight forwarding. I'm not really sure how things are organized at other large companies as Amazon was my only experience into mega corp work.
cj 4y ago
This article quotes the letter sent to employees, which is published here: https://www.flexport.com/blog/flexport-co-ceos-note-to-employees/ https://www.flexport.com/blog/flexport-co-ceos-note-to-emplo...
sremani 4y ago
>> It is also hiring some 350 to 400 engineering and software staff, as it focuses on efficiency and technology. Is it safe to say the Global Trade is down but there is still demand (for now) for tech efficiencies.
- game_the0ry 4y ago
  So far, it is still a good time to be a software engineer.
pm90 4y ago
This is really surprising considering the number of open recs they post on linkedin.
- confidantlake 4y ago
  It is time we stop treating recs on linkedin as evidence of hiring. It is just as much an advertising tool as it is a genuine desire to hire people.
  - operatingthetan 4y ago
    Exactly. I've been told this before: "we have open reqs so there can't be a layoff!" Of course one follows eventually whether there are reqs or not. The reqs are just sitting there and they aren't responding to applications.
willcipriano 4y ago
Remember when everyone cut jobs and canceled orders at the beginning of the pandemic and it really bit them? I'm like 49% sure that's going to happen again. Something funny is in the air.
- marcosdumay 4y ago
  Do you expect easy money to come back? Nearly all of the companies laying people off are the unsustainable ones. I can imagine a lot of companies struggling to hire in a few months. But I can't imagine they being the same ones that are just firing.
  - brianwawok 4y ago
    Google? Microsoft? Facebook? There are a lot of companies not unsustainabled, at least in the 10 year frame, that are laying off.
  - lmm 4y ago
    I think easy money is coming back. There's still a bunch of wealth that doesn't know anywhere to find returns, that hasn't changed.
    - newaccount2021 4y ago
      [dead]
    - dougSF70 4y ago
      But with inflation driving up interest rates, that wealth will appreciate sitting as cash.
      - deleted 4y ago
        [deleted]
      - lmm 4y ago
        High inflation means it's all the more important to find a return. You don't get interest from holding cash, you get interest from lending it out; on a personal scale maybe you can do that by lending to your bank but for those looking for a return on large amounts of capital it's not that simple.
Baeocystin 4y ago
Reading the letter, it looks like the departing folks are being offered good severance. That makes me happy to see. I've been through rounds of layoffs myself. It never feels good, but how the company treats you if your number is called makes for a lasting impression.
coolbreezetft22 4y ago
I interviewed for a software engineering position here literally just yesterday.
- saos 4y ago
  > we are in the process of doubling our software engineering talent and moving to single threaded business organizations to build world class products faster, and we will continue to invest in delivering best-in-class operational execution for our customers. Will be fine. I wonder what roles they elimated though. Good question for you to ask
blacklight 4y ago
-
- brianwawok 4y ago
  Only a 4 minute uncertainty window seems ok to me? If you were CEO how would you lay off 20% of your company?
  - blacklight 4y ago
    Probably I wouldn't lay off 20% of my staff at all, unless I was really sailing in stormy waters with no way out. And Flexport isn't: there's been a slight dip in global supply chains caused by the uncertainty in China, but nothing so dramatic nor permanent that you should run and fire 1/5 of your staff - you only do that if something happens like China attacking Taiwan, and you know that for years to come trade won't be the same. It sounds to me like another Silicon Valley company laying off large chunks of their staff because everyone else is doing so: https://news.stanford.edu/2022/12/05/explains-recent-tech-layoffs-worried/ https://news.stanford.edu/2022/12/05/explains-recent-tech-la.... Or maybe because VC funds are suddenly draining for everyone? And,if I really had to lay off so many people, I'd take a more personal approach. Invite the whole company for a virtual or physical meeting where I explain why I have to do that, why I have no alternatives, and communicate the decisions to the managers, so people can be let go after talking to a human. Not after getting an email out of the blue in their box, in the middle of a working day. This has been impersonal and faceless on so many levels.
    - brianwawok 4y ago
      The "I would never do X" is a classic response of someone who hasn't had to be there and do that. I suspect if you ever make it to that position, you will reach a point where you either have to do a big layoff - or your company will fold. So it's rather likely that you will fold, and no longer be a CEO.
      - adamsmith143 4y ago
whatever1 4y ago
The AMZN logistics ceo first ruined AMZN with the over expansion and then took the ceo role in flexport to do exactly the same thing. Amazing incompetence.
- greatpostman 4y ago
  These people just got into amazon early and rode the wave to the top. Some of them are truly talented, most were in the right place at the right time
  - saysAl0t 4y ago
    Right place and time (era of cheap money) explains the majority of our so-called genius tech CEOs. A handful of ideas from info theory coupled with government desire to hype nation state brand does not a genius make. None of these people have established net new ideas. Just borrowing from Gödel, Shannon, Turing, and the like. Computer networks put the visibility, routing of logistics within reach of the masses. But we’re obliged to preserve the meme of aristocrats knowing best.
    - pinewurst 4y ago
      Not just CEOs, a lot of upper management all over. My own employer just hired a bunch of ex-Microsoft & Google people who are hardly the sharpest pencils (other than politically) and it seems all about the name on the resume.
      - saysAl0t 4y ago
        Indeed: https://hbr.org/2016/09/excess-management-is-costing-the-us-3-trillion-per-year https://hbr.org/2016/09/excess-management-is-costing-the-us-...
  - pbalau 4y ago
    You are phrasing this as most of these people were simply lucky to be there, when the reality is that most of these people are the reason why Amazon is the top dog in online retail...
calr 4y ago
In my mind, Flexport is part of the "real" economy of moving atoms. They don't fall into the more fluffy "we are a startup that helps other startups start-up". I wonder if this is an early sign for a rough recession that spills outside of the current VC-backed tech slowdown.
- colechristensen 4y ago
  I’m not sure it’s that strong a signal, the covid effect on shipping meant that there was a huge backlog of stuff to ship which of course got worked through eventually. But yes one should expect an actual recession outside just shrinking the tech bubble.
- moffkalast 4y ago
  > we are a startup that helps other startups start-up Well that's YCombinator in a nutshell.
dakiol 4y ago
Perhaps I'm naive, but I think companies are doing massive layoffs these days because of some sort of "domino effect". There are companies out there who would love to lay off half their staff, but in regular times they couldn't just do it (because it wasn't a common thing, and makes them look "bad"... everyone would protest). But since nowadays every damn company is doing massive layoffs (and not unknown companies, but companies like Twitter, Facebook, Google, etc.) then they take advantage of the situation and proceed to do the same. > While we are looking forward to what’s to come in 2023, we must also make hard decisions necessary to set us up for long-term success. This could have been said any damn year in the past, but massive layoffs is the latest trend, so why not.
- zitterbewegung 4y ago
  You are naive they just want to rehire positions at lower rates if you see in the article they are cutting 600 but are hiring for 350 to 400 people. It would immediately allow them to replace higher wages workers that have been with the company with entry level positions . Also it seems like an identification of long term trends and they figure they want to invest in automation.
  - dakiol 4y ago
    Well, that's what I said. They are doing it not because of "bad times" or "recession" or "post-covid era", they are doing it because that's what they wanted to do from the beginning. They couldn't do a massive layoff in the past because it would get them bad rep, but nowadays, it barely is a thing anymore (just look at this thread: people commenting "well, at least the severance is nice". What the hell? Massive layoffs shouldn't be seen as regular news)
    - 72f988bf 4y ago
      > They couldn't do a massive layoff in the past because it would get them bad rep Forget about "bad rep", it was a bad economic decision: why let go a slight underperformer (a now-known 0.8x engineer) that you hired in 2015 at pay X, if in exchange you hire a "expected normal 1.0x engineer", but at a price of 1.8*X in 2021 due to crazy escalation of SWE salaries in that period. (Assuming you have a perfected/more picky hiring process that knows the median hire will be a 1.0x engineer) Now in 2023, the situation is different: you can hire a "expected normal 1.0x engineer" but at pay 0.8*X (adjusted for inflation - ratios all made up)
crote 4y ago
Wow, that's a huge surprise. I hadn't heard of Flexport before, but they seem to be focused on global shipping. The company I work for ships almost all of its products internationally, and we have seen a massive price hike over the last 2-3 years. Some of it necessary due to rising costs, but we know for a fact that larger-volume customers are still getting lower prices. Additionally, the well-known carriers still offer incredibly poor service - most notably when it comes to tracking shipments and providing proper updates. This seems to be exactly the market Flexport wants to tackle. If they can't even compete in the current overheated market, something must be going seriously wrong at their end.
- anm89 4y ago
  The market right now is FAR from overheated. In fact maritime shipping is collapsing right now. https://www.drewry.co.uk/supply-chain-advisors/supply-chain-expertise/world-container-index-assessed-by-drewry https://www.drewry.co.uk/supply-chain-advisors/supply-chain-... Both volume and rates are down roughly 80% YOY.
  - crote 4y ago
    Trust me, we're not seeing any of that in practice yet. Although that could be because we almost exclusively use air shipping.
  - WWLink 4y ago
    That the companies are so sensitive to spikes and valleys in the market speaks louder about how badly run the companies are than anything else.
    - icegreentea2 4y ago
      How would you better run transport/logistics company to not be as sensitive to spikes and valleys as a typical current transport/logistics company?
  - alsfjslkdfgj 4y ago
    [flagged]
anm89 4y ago
People in this thread seem to be expressing confusion as to why they would be doing this "when the economy is still so strong" The economy is not "still strong" by most measures. Employment is still strong although there are lot's of arguments to be made that when you dig beneath the surface things are much less rosy. But it get's way worse when you look past employment. Both volume and rates on maritime container shipping are down roughly 80% YOY. https://www.drewry.co.uk/supply-chain-advisors/supply-chain-expertise/world-container-index-assessed-by-drewry https://www.drewry.co.uk/supply-chain-advisors/supply-chain-... PMIs are falling off of a cliff https://tradingeconomics.com/united-states/manufacturing-pmi https://tradingeconomics.com/united-states/manufacturing-pmi S&p Earnings are in steep decline off the peak https://www.macrotrends.net/1324/s-p-500-earnings-history https://www.macrotrends.net/1324/s-p-500-earnings-history Consumer revolving credit is extremely high while the savings rate has fallen off of a cliff since the pandemic peak https://fred.stlouisfed.org/series/REVOLSL https://fred.stlouisfed.org/series/REVOLSL https://fred.stlouisfed.org/series/PSAVERT https://fred.stlouisfed.org/series/PSAVERT Housing volume has fallen off of a cliff, auto wholesale has fallen off a cliff, Major Metro Commercial real estate volume has fallen off a cliff while REITs are suspending withdraws. All of this while tax receipts are about to drop off of a cliff while US debt to GDP and deficit to GDP are essentially at historic highs while the rollover rate on that debt is constantly increasing. And then realize that the US is in a drastically better position than China, Europe and Japan It seems like some of the HN crowd is very out of touch with the realities of the economic data.
epivosism 4y ago
Many people seem surprised that an organization would simultaneously hire and fire. I think that's normal. At the end of every season, the Yankees fire some players and hire others. Old cells in organisms die or are killed, while new ones are born. Soldiers going on missions may put down the equipment from the prior mission, and pick up new equipment. The argument "the organization is behaving selfishly, they should just repurposing the existing organization member" is inane since the function of members of an organization depends on the member's specialty, role, purpose, and an organization's purpose can change over time. It's really strange people act like this is some killer argument when in fact nearly every organization with multiple entities does something analogous (grow in some ways, shrink in others, at the same time)
abadger9 4y ago
This is one company i've always wanted to work for- my mother is a CTO of a company in the same space/different aspect of the pipeline so I knew this company was going to do well when it entered the YC batch, but I've never even received a screening interview. Hope i can apply once the economy recovers
- warent 4y ago
  I interviewed a couple years back and found it to be a very weird, cold process. It's a neat business model but I don't know about their culture.
  - pchristensen 4y ago
    I’m sorry you didn’t have a bad experience interviewing. I feel like Flexport has the most balanced culture of any company I’ve worked at.
- pchristensen 4y ago
  If you’re a software engineer, you don’t need to wait for the economy to recover. Email me if you have questions!
grey-area 4y ago
A global recession is coming against a backdrop of the Fed raising rates, that is going to be very painful. A lot of people here don't seem to realise this is the case or are in denial. This is a bubble bursting, this is serious. Lots of companies are laying off workers or at least freezing hiring because they anticipate earnings cratering, or are already seeing it happen. They haven't reported on it yet, but they will in the coming months. The layoffs will continue to gather pace, as will bankruptcies.
- warent 4y ago
  EDIT: Thank you all for generously sharing your time in writing up such thoughtful answers. -- Would love to hear more on your perspective / insight. This is all intentional, right? My understanding is that the fed is leaning into this particularly hard in order to dislodge the stubborn housing bubble. For an individual (someone who isn't a current business owner), does this basically mean we should continue stockpiling savings, and avoid moving (rent) / avoid buying house / buying a car? Any ideas how long this could last / what the bottom looks like?
  - ryanSrich 4y ago
    2008 lasted nearly 17 months. The hard part is deciding when the recession actually started. The media and government is in denial, so they'd tell you we aren't even in a recession yet. But the rule of thumb is typically two negative quarters of GDP growth, which we hit this summer. If you run a VC backed business my suggestion is 24-30 months of runway is a good starting point. As far as individuals go, it's not a bad idea to mirror this advice. Have essentially 2 to 2.5 years of income saved in the event that you get laid off and can't find a job for a long time. Hopefully it never comes to that, but it never hurts to be prepared.
    - kasey_junk 4y ago
      It’s also hard to figure out when the recession ends. The q1/q2 numbers were more than made up by the q3 gdp growth. The numbers for q4 aren’t out yet but the consensus thinks they’ll be slightly positive making 2022 a positive year. That’s after 2021 which was a barn burner. The GDP curve is already nothing like 2008 so it’s hard to use it as a guide.
sanguy 4y ago
Already seeing startups out of funding and not able to raise more being given away to companies that can assume the payroll and running costs. We've had 5 such approaches in the past 6 weeks of which 2 we have taken over. It is going to get very very bad inside the next 6 months. We're still in the pre-swell phase before the tidal wave hits.
- grey-area 4y ago
  Yes, an awful lot of companies assumed the free money would last forever, and now it has stopped, they are faced with two choices: 1. Start making money 2. Sell the company Many of them will tell themselves that they can somehow see massive growth and start making a profit, and will fail while trying to do so.
- wferrell 4y ago
  Where do you work?
ffggvv 4y ago
remember this company was being hyped alot on twitter the past 2 years as we had supply chain issues. glad i dont just follow the trend.
mensetmanusman 4y ago
The fed strategy will fail because the labor market will always be tight due to retirements.
- pm90 4y ago
  And lower immigration levels.
zwilliamson 4y ago
I’d be curious to get Peter Zeihan’s thoughts on this. Flexport’s business is built around globalization and trade. What if Peter is right and we are seeing it all unravel before our eyes right now? Trading paradigms shifting to regional groups of countries. I wonder if this is on the radar for companies like Flexport https://en.m.wikipedia.org/wiki/The_End_of_the_World_Is_Just_the_Beginning https://en.m.wikipedia.org/wiki/The_End_of_the_World_Is_Just...
michaelteter 4y ago
When I interviewed with them 2-3 years ago, I recall being told that while the goal was to automate shipping, 95% of their shipping was being done with humans and human processes (due to the complex and irregular nature of shipping). I would expect that a global reduction in shipping traffic would mean needing fewer of these people internally; so I suspect that's the bulk of the 20% reduction group.
LarsDu88 4y ago
I think what's missing in a lot of these articles are the headcounts of these companies in 2019. Does a 20% layoff hit as hard if the readers find out headcount at a given company is 200% larger than in 2019?
nsonha 4y ago
This is one of those companies that were always hiring when I checked HN's jobs page. Honestly I thought they seemed like they have trouble hiring, but good for them that at least they've hired enough to get to the point they need a reduction.

192 points by drone 4y ago

I have been badgered by their recruiters multiple times a week through the last 2-3 years. No doubt they grossly overhired during that period.

maldeh 4y ago

Barely two months from their announcing a hiring spree... https://www.reuters.com/business/logistics-startup-flexport-plans-hiring-spree-double-engineers-2023-2022-11-02/ https://www.reuters.com/business/logistics-startup-flexport-...

deleted 4y ago
[deleted]
ec109685 4y ago
They’re one of the biggest job promoters here, so it will be odd not seeing their jobs show up for a while. Flexport always seemed to be hiring.
- pchristensen 4y ago
  You’ll still see the jobs. Flexport is still hiring many software engineers. Source: I’m a hiring manager for software engineers at Flexport.
JamesAdir 4y ago
A way to lower salaries. Fire the expensive ones, hire cheaper employees.

msoad 4y ago

I don't know what Flexport is, all I know is that it was the only jobs ad in Hacker News for a long time

amalgamated_inc 4y ago
I think it's that guy typesfast?
deleted 4y ago
[deleted]
mattigames 4y ago
At some point I wondered if flexport had bought hacker news or something like that to be seeing their ads so frequently.
- dilyevsky 4y ago
  As yc company I believe you get certain number of these posts for free. I think they were just one of the very few who was still using them
- jacquesm 4y ago
  No, Pachyderm bought HN.
  - myth_drannon 4y ago
    Funny, it's one of these companies that screams "we are hiring!" everywhere but looking at their Linkedin employee growth it's basically flat for more than a year.
alismayilov 4y ago
Same here. When I saw the company name, I remember that I was seeing job ads from this company on HN for a long time.
ProAm 4y ago
This is the guy that got famous during the pandemic for suggesting ports stack containers 3 or 4 levels high vs the standard of 2 [1] [2] Turns out 2 is just fine. [G] https://www.npr.org/2021/11/03/1051773672/a-look-at-whats-causing-shipping-bottlenecks-from-the-entrenched-to-the-absurd https://www.npr.org/2021/11/03/1051773672/a-look-at-whats-ca... [H] https://news.ycombinator.com/item?id=28957379 https://news.ycombinator.com/item?id=28957379

72f988bf 4y ago

The original source seems to be posted at https://www.flexport.com/blog/flexport-co-ceos-note-to-employees/ https://www.flexport.com/blog/flexport-co-ceos-note-to-emplo...

CityOfThrowaway 4y ago
Interesting that they say: > At Flexport, 2023 is going to bring extraordinary velocity – we are in the process of doubling our software engineering talent and moving to single threaded business organizations to build world class products faster, and we will continue to invest in delivering best-in-class operational execution for our customers. Looks like they are laying off non-tech workers who they have made (or will make) obsolete through automation
- globalise83 4y ago
  moving to single threaded business organizations What does that even mean? They are only able to do one thing at a time? Doesn't sound like a recipe for business success to me...
  - panda88888 4y ago
    Probably removing redundancy in the business flow process path?
  - JimtheCoder 4y ago
    "They are only able to do one thing at a time?" To be fair, many new businesses cannot do one thing at a time, so maybe singular focus is a good thing at this stage...
  - paxys 4y ago
    Narrowing focus is often a good thing for companies.
  - makestuff 4y ago
    Dave clark brought this from Amazon. At Amazon they call it "STLs" or single threaded leadership. Basically you assign one director/vp/etc. to the business, and they are responsible for PnL/success. It isn't that you do one thing at a time as an entire company, but your org is focused on one thing. For example, maybe there is a director who runs an org in charge of international freight forwarding. I'm not really sure how things are organized at other large companies as Amazon was my only experience into mega corp work.

cj 4y ago

This article quotes the letter sent to employees, which is published here: https://www.flexport.com/blog/flexport-co-ceos-note-to-employees/ https://www.flexport.com/blog/flexport-co-ceos-note-to-emplo...

sremani 4y ago

>> It is also hiring some 350 to 400 engineering and software staff, as it focuses on efficiency and technology. Is it safe to say the Global Trade is down but there is still demand (for now) for tech efficiencies.

game_the0ry 4y ago
So far, it is still a good time to be a software engineer.

pm90 4y ago

This is really surprising considering the number of open recs they post on linkedin.

confidantlake 4y ago
It is time we stop treating recs on linkedin as evidence of hiring. It is just as much an advertising tool as it is a genuine desire to hire people.
- operatingthetan 4y ago
  Exactly. I've been told this before: "we have open reqs so there can't be a layoff!" Of course one follows eventually whether there are reqs or not. The reqs are just sitting there and they aren't responding to applications.

willcipriano 4y ago

Remember when everyone cut jobs and canceled orders at the beginning of the pandemic and it really bit them? I'm like 49% sure that's going to happen again. Something funny is in the air.

marcosdumay 4y ago
Do you expect easy money to come back? Nearly all of the companies laying people off are the unsustainable ones. I can imagine a lot of companies struggling to hire in a few months. But I can't imagine they being the same ones that are just firing.
- brianwawok 4y ago
  Google? Microsoft? Facebook? There are a lot of companies not unsustainabled, at least in the 10 year frame, that are laying off.
- lmm 4y ago
  I think easy money is coming back. There's still a bunch of wealth that doesn't know anywhere to find returns, that hasn't changed.
  - newaccount2021 4y ago
    [dead]
  - dougSF70 4y ago
    But with inflation driving up interest rates, that wealth will appreciate sitting as cash.
    - deleted 4y ago
      [deleted]
    - lmm 4y ago
      High inflation means it's all the more important to find a return. You don't get interest from holding cash, you get interest from lending it out; on a personal scale maybe you can do that by lending to your bank but for those looking for a return on large amounts of capital it's not that simple.

Baeocystin 4y ago

Reading the letter, it looks like the departing folks are being offered good severance. That makes me happy to see. I've been through rounds of layoffs myself. It never feels good, but how the company treats you if your number is called makes for a lasting impression.

coolbreezetft22 4y ago

I interviewed for a software engineering position here literally just yesterday.

saos 4y ago
> we are in the process of doubling our software engineering talent and moving to single threaded business organizations to build world class products faster, and we will continue to invest in delivering best-in-class operational execution for our customers. Will be fine. I wonder what roles they elimated though. Good question for you to ask

blacklight 4y ago

brianwawok 4y ago
Only a 4 minute uncertainty window seems ok to me? If you were CEO how would you lay off 20% of your company?
- blacklight 4y ago
  Probably I wouldn't lay off 20% of my staff at all, unless I was really sailing in stormy waters with no way out. And Flexport isn't: there's been a slight dip in global supply chains caused by the uncertainty in China, but nothing so dramatic nor permanent that you should run and fire 1/5 of your staff - you only do that if something happens like China attacking Taiwan, and you know that for years to come trade won't be the same. It sounds to me like another Silicon Valley company laying off large chunks of their staff because everyone else is doing so: https://news.stanford.edu/2022/12/05/explains-recent-tech-layoffs-worried/ https://news.stanford.edu/2022/12/05/explains-recent-tech-la.... Or maybe because VC funds are suddenly draining for everyone? And,if I really had to lay off so many people, I'd take a more personal approach. Invite the whole company for a virtual or physical meeting where I explain why I have to do that, why I have no alternatives, and communicate the decisions to the managers, so people can be let go after talking to a human. Not after getting an email out of the blue in their box, in the middle of a working day. This has been impersonal and faceless on so many levels.
  - brianwawok 4y ago
    The "I would never do X" is a classic response of someone who hasn't had to be there and do that. I suspect if you ever make it to that position, you will reach a point where you either have to do a big layoff - or your company will fold. So it's rather likely that you will fold, and no longer be a CEO.
    - adamsmith143 4y ago

whatever1 4y ago

The AMZN logistics ceo first ruined AMZN with the over expansion and then took the ceo role in flexport to do exactly the same thing. Amazing incompetence.

greatpostman 4y ago
These people just got into amazon early and rode the wave to the top. Some of them are truly talented, most were in the right place at the right time
- saysAl0t 4y ago
  Right place and time (era of cheap money) explains the majority of our so-called genius tech CEOs. A handful of ideas from info theory coupled with government desire to hype nation state brand does not a genius make. None of these people have established net new ideas. Just borrowing from Gödel, Shannon, Turing, and the like. Computer networks put the visibility, routing of logistics within reach of the masses. But we’re obliged to preserve the meme of aristocrats knowing best.
  - pinewurst 4y ago
    Not just CEOs, a lot of upper management all over. My own employer just hired a bunch of ex-Microsoft & Google people who are hardly the sharpest pencils (other than politically) and it seems all about the name on the resume.
    - saysAl0t 4y ago
      Indeed: https://hbr.org/2016/09/excess-management-is-costing-the-us-3-trillion-per-year https://hbr.org/2016/09/excess-management-is-costing-the-us-...
- pbalau 4y ago
  You are phrasing this as most of these people were simply lucky to be there, when the reality is that most of these people are the reason why Amazon is the top dog in online retail...

calr 4y ago

In my mind, Flexport is part of the "real" economy of moving atoms. They don't fall into the more fluffy "we are a startup that helps other startups start-up". I wonder if this is an early sign for a rough recession that spills outside of the current VC-backed tech slowdown.

colechristensen 4y ago
I’m not sure it’s that strong a signal, the covid effect on shipping meant that there was a huge backlog of stuff to ship which of course got worked through eventually. But yes one should expect an actual recession outside just shrinking the tech bubble.
moffkalast 4y ago
> we are a startup that helps other startups start-up Well that's YCombinator in a nutshell.

dakiol 4y ago

Perhaps I'm naive, but I think companies are doing massive layoffs these days because of some sort of "domino effect". There are companies out there who would love to lay off half their staff, but in regular times they couldn't just do it (because it wasn't a common thing, and makes them look "bad"... everyone would protest). But since nowadays every damn company is doing massive layoffs (and not unknown companies, but companies like Twitter, Facebook, Google, etc.) then they take advantage of the situation and proceed to do the same. > While we are looking forward to what’s to come in 2023, we must also make hard decisions necessary to set us up for long-term success. This could have been said any damn year in the past, but massive layoffs is the latest trend, so why not.

zitterbewegung 4y ago
You are naive they just want to rehire positions at lower rates if you see in the article they are cutting 600 but are hiring for 350 to 400 people. It would immediately allow them to replace higher wages workers that have been with the company with entry level positions . Also it seems like an identification of long term trends and they figure they want to invest in automation.
- dakiol 4y ago
  Well, that's what I said. They are doing it not because of "bad times" or "recession" or "post-covid era", they are doing it because that's what they wanted to do from the beginning. They couldn't do a massive layoff in the past because it would get them bad rep, but nowadays, it barely is a thing anymore (just look at this thread: people commenting "well, at least the severance is nice". What the hell? Massive layoffs shouldn't be seen as regular news)
  - 72f988bf 4y ago
    > They couldn't do a massive layoff in the past because it would get them bad rep Forget about "bad rep", it was a bad economic decision: why let go a slight underperformer (a now-known 0.8x engineer) that you hired in 2015 at pay X, if in exchange you hire a "expected normal 1.0x engineer", but at a price of 1.8*X in 2021 due to crazy escalation of SWE salaries in that period. (Assuming you have a perfected/more picky hiring process that knows the median hire will be a 1.0x engineer) Now in 2023, the situation is different: you can hire a "expected normal 1.0x engineer" but at pay 0.8*X (adjusted for inflation - ratios all made up)

crote 4y ago

Wow, that's a huge surprise. I hadn't heard of Flexport before, but they seem to be focused on global shipping. The company I work for ships almost all of its products internationally, and we have seen a massive price hike over the last 2-3 years. Some of it necessary due to rising costs, but we know for a fact that larger-volume customers are still getting lower prices. Additionally, the well-known carriers still offer incredibly poor service - most notably when it comes to tracking shipments and providing proper updates. This seems to be exactly the market Flexport wants to tackle. If they can't even compete in the current overheated market, something must be going seriously wrong at their end.

anm89 4y ago
The market right now is FAR from overheated. In fact maritime shipping is collapsing right now. https://www.drewry.co.uk/supply-chain-advisors/supply-chain-expertise/world-container-index-assessed-by-drewry https://www.drewry.co.uk/supply-chain-advisors/supply-chain-... Both volume and rates are down roughly 80% YOY.
- crote 4y ago
  Trust me, we're not seeing any of that in practice yet. Although that could be because we almost exclusively use air shipping.
- WWLink 4y ago
  That the companies are so sensitive to spikes and valleys in the market speaks louder about how badly run the companies are than anything else.
  - icegreentea2 4y ago
    How would you better run transport/logistics company to not be as sensitive to spikes and valleys as a typical current transport/logistics company?
- alsfjslkdfgj 4y ago
  [flagged]

anm89 4y ago

People in this thread seem to be expressing confusion as to why they would be doing this "when the economy is still so strong" The economy is not "still strong" by most measures. Employment is still strong although there are lot's of arguments to be made that when you dig beneath the surface things are much less rosy. But it get's way worse when you look past employment. Both volume and rates on maritime container shipping are down roughly 80% YOY. https://www.drewry.co.uk/supply-chain-advisors/supply-chain-expertise/world-container-index-assessed-by-drewry https://www.drewry.co.uk/supply-chain-advisors/supply-chain-... PMIs are falling off of a cliff https://tradingeconomics.com/united-states/manufacturing-pmi https://tradingeconomics.com/united-states/manufacturing-pmi S&p Earnings are in steep decline off the peak https://www.macrotrends.net/1324/s-p-500-earnings-history https://www.macrotrends.net/1324/s-p-500-earnings-history Consumer revolving credit is extremely high while the savings rate has fallen off of a cliff since the pandemic peak https://fred.stlouisfed.org/series/REVOLSL https://fred.stlouisfed.org/series/REVOLSL https://fred.stlouisfed.org/series/PSAVERT https://fred.stlouisfed.org/series/PSAVERT Housing volume has fallen off of a cliff, auto wholesale has fallen off a cliff, Major Metro Commercial real estate volume has fallen off a cliff while REITs are suspending withdraws. All of this while tax receipts are about to drop off of a cliff while US debt to GDP and deficit to GDP are essentially at historic highs while the rollover rate on that debt is constantly increasing. And then realize that the US is in a drastically better position than China, Europe and Japan It seems like some of the HN crowd is very out of touch with the realities of the economic data.

epivosism 4y ago

Many people seem surprised that an organization would simultaneously hire and fire. I think that's normal. At the end of every season, the Yankees fire some players and hire others. Old cells in organisms die or are killed, while new ones are born. Soldiers going on missions may put down the equipment from the prior mission, and pick up new equipment. The argument "the organization is behaving selfishly, they should just repurposing the existing organization member" is inane since the function of members of an organization depends on the member's specialty, role, purpose, and an organization's purpose can change over time. It's really strange people act like this is some killer argument when in fact nearly every organization with multiple entities does something analogous (grow in some ways, shrink in others, at the same time)

abadger9 4y ago

This is one company i've always wanted to work for- my mother is a CTO of a company in the same space/different aspect of the pipeline so I knew this company was going to do well when it entered the YC batch, but I've never even received a screening interview. Hope i can apply once the economy recovers

warent 4y ago
I interviewed a couple years back and found it to be a very weird, cold process. It's a neat business model but I don't know about their culture.
- pchristensen 4y ago
  I’m sorry you didn’t have a bad experience interviewing. I feel like Flexport has the most balanced culture of any company I’ve worked at.
pchristensen 4y ago
If you’re a software engineer, you don’t need to wait for the economy to recover. Email me if you have questions!

grey-area 4y ago

A global recession is coming against a backdrop of the Fed raising rates, that is going to be very painful. A lot of people here don't seem to realise this is the case or are in denial. This is a bubble bursting, this is serious. Lots of companies are laying off workers or at least freezing hiring because they anticipate earnings cratering, or are already seeing it happen. They haven't reported on it yet, but they will in the coming months. The layoffs will continue to gather pace, as will bankruptcies.

warent 4y ago
EDIT: Thank you all for generously sharing your time in writing up such thoughtful answers. -- Would love to hear more on your perspective / insight. This is all intentional, right? My understanding is that the fed is leaning into this particularly hard in order to dislodge the stubborn housing bubble. For an individual (someone who isn't a current business owner), does this basically mean we should continue stockpiling savings, and avoid moving (rent) / avoid buying house / buying a car? Any ideas how long this could last / what the bottom looks like?
- ryanSrich 4y ago
  2008 lasted nearly 17 months. The hard part is deciding when the recession actually started. The media and government is in denial, so they'd tell you we aren't even in a recession yet. But the rule of thumb is typically two negative quarters of GDP growth, which we hit this summer. If you run a VC backed business my suggestion is 24-30 months of runway is a good starting point. As far as individuals go, it's not a bad idea to mirror this advice. Have essentially 2 to 2.5 years of income saved in the event that you get laid off and can't find a job for a long time. Hopefully it never comes to that, but it never hurts to be prepared.
  - kasey_junk 4y ago
    It’s also hard to figure out when the recession ends. The q1/q2 numbers were more than made up by the q3 gdp growth. The numbers for q4 aren’t out yet but the consensus thinks they’ll be slightly positive making 2022 a positive year. That’s after 2021 which was a barn burner. The GDP curve is already nothing like 2008 so it’s hard to use it as a guide.

sanguy 4y ago

Already seeing startups out of funding and not able to raise more being given away to companies that can assume the payroll and running costs. We've had 5 such approaches in the past 6 weeks of which 2 we have taken over. It is going to get very very bad inside the next 6 months. We're still in the pre-swell phase before the tidal wave hits.

grey-area 4y ago
Yes, an awful lot of companies assumed the free money would last forever, and now it has stopped, they are faced with two choices: 1. Start making money 2. Sell the company Many of them will tell themselves that they can somehow see massive growth and start making a profit, and will fail while trying to do so.
wferrell 4y ago
Where do you work?

ffggvv 4y ago

remember this company was being hyped alot on twitter the past 2 years as we had supply chain issues. glad i dont just follow the trend.

mensetmanusman 4y ago

The fed strategy will fail because the labor market will always be tight due to retirements.

pm90 4y ago
And lower immigration levels.

zwilliamson 4y ago

I’d be curious to get Peter Zeihan’s thoughts on this. Flexport’s business is built around globalization and trade. What if Peter is right and we are seeing it all unravel before our eyes right now? Trading paradigms shifting to regional groups of countries. I wonder if this is on the radar for companies like Flexport https://en.m.wikipedia.org/wiki/The_End_of_the_World_Is_Just_the_Beginning https://en.m.wikipedia.org/wiki/The_End_of_the_World_Is_Just...

michaelteter 4y ago

When I interviewed with them 2-3 years ago, I recall being told that while the goal was to automate shipping, 95% of their shipping was being done with humans and human processes (due to the complex and irregular nature of shipping). I would expect that a global reduction in shipping traffic would mean needing fewer of these people internally; so I suspect that's the bulk of the 20% reduction group.

LarsDu88 4y ago

I think what's missing in a lot of these articles are the headcounts of these companies in 2019. Does a 20% layoff hit as hard if the readers find out headcount at a given company is 200% larger than in 2019?

nsonha 4y ago

This is one of those companies that were always hiring when I checked HN's jobs page. Honestly I thought they seemed like they have trouble hiring, but good for them that at least they've hired enough to get to the point they need a reduction.