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Flexport is laying off 20% of its workforce
- toomuchtodo 3y agohttps://www.flexport.com/blog/flexport-ceos-note-to-employees/ https://www.flexport.com/blog/flexport-ceos-note-to-employee...
- ChrisMarshallNY 3y agoOof. Friday the 13th.
- xebus 3y agoIt seems odd to use the term “departing Flexporters” as the identity of those employees who are being let go.
- formvoltron 3y agodo they make much money? and what sort of moat do they have?
- ludston 3y agoThey're a freight-forwarder branding themselves as a software company, competing with the likes of DHL, DSV and 100s of other smaller organisations. In short, they have a very viable business model, but freight forwarding is a cut-throat industry.
- aranw 3y agoFlexport were advertising for roles on HN a few months ago. I'm sure they come up regularly for roles?
- toomuchtodo 3y agoBit of shake up going on. Their billionaire founder is coming back into a CEO role, cleaned house at the top (of folks that came in from Amazon), and after rescinding job offers a month ago and 20% layoffs 9 months ago, they're now trimming another 20%. Internet rando analysis: Flexport most likely surfed the COVID wave of shipping, but the new macro makes the go forward much more challenging with aggregate demand declining (you can see this in both marine and over the road shipping volume declining). Boom time->war time transition as an org, hit by both rapidly rising interest rates (cost of capital, equity valuations) at the same time as volume declines precipitously. https://www.flexport.com/research/post-covid/ https://www.flexport.com/research/post-covid/ https://www.flexport.com/research/after-the-boom-evolving-e-commerce-supply-chains/ https://www.flexport.com/research/after-the-boom-evolving-e-... https://www.flexport.com/blog/how-long-will-covid-impact-last-a-new-index-predicts-shifts-in-goods-demand/ https://www.flexport.com/blog/how-long-will-covid-impact-las... https://www.freightos.com/wp-content/uploads/2023/05/FBX-Ocean-Container-Spot-Rates-During-the-Pandemic.png https://www.freightos.com/wp-content/uploads/2023/05/FBX-Oce... https://www.cnbc.com/2023/04/24/economy-is-in-a-freight-recession-with-china-trade-heading-lower.html https://www.cnbc.com/2023/04/24/economy-is-in-a-freight-rece... https://www.ccjdigital.com/economic-trends/article/15543395/freight-shipments-spending-dropping https://www.ccjdigital.com/economic-trends/article/15543395/... https://talkbusiness.net/2023/02/u-s-freight-volumes-fall-to-lowest-levels-in-9-years/ https://talkbusiness.net/2023/02/u-s-freight-volumes-fall-to... https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=flexport&sort=byDate&type=story https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...
- addicted 3y agoThe major red flag to me appears to be the fact that they couldn’t beat Amazon to a logistics contract with Shopify. It seems a lot of these actions followed that failure.
- EduardoBautista 3y ago> I evaluated every role in the company and its relationship to solving important supply chain problems for our customers And somehow that ended up with the nice round number of 20%.
- kibwen 3y ago"I evaluated every role in the company and its relationship to solving important supply chain problems for our customers, which made me realize that myself and the entire C-suite are useless parasites, but we have to cut costs somewhere, so ¯\_(ツ)_/¯"
- mtmail 3y agoThe article says CFO and head of HR were also let go.
- choppaface 3y agoThat's more of a tantrum move than a financial strategy move. It would likely have saved the company money of these two stayed on to help with the post-layoff chaos and prepare for the next round where they'd then depart and be done. That said, maybe their golden parachutes were large enough they opted to leave.
- tschwimmer 3y agoThe CFO and head of HR were not let go as part of this round of layoffs, they were fired shortly after Dave Clark left. [0] [0]https://www.cnbc.com/2023/09/27/flexport-loses-cfo-hr-chief-weeks-after-ouster-of-ceo-dave-clark.html https://www.cnbc.com/2023/09/27/flexport-loses-cfo-hr-chief-...
- deleted 3y ago[deleted]
- dangus 3y agoApparently they’ll have a billion in net cash after this change, which is over a million dollars per “departing flexporter.” And yet the employees get a barebones 9 week severance. Lame.
- supernova87a 3y agoWhat's the logic, that if a company has cash available then it should just go to the employees? If the money is all borrowed and meant to keep the company running, why would employees get more than is a reasonable severance package? And by the way, 9 weeks of severance on pretty good tech job salaries is far more than many are lucky enough to get, lest you live in too much of a bubble to realize.
- todoG 3y ago[flagged]
- DannyPage 3y ago> And by the way, 9 weeks of severance on pretty good tech job salaries is far richer than many get. It's drastically shorter than their cohort of tech companies, which is the comparison they sell themselves as. Between that and the rescinded offers, if they do ever make it out of this trough, they'll have a hard reputation to shake and have to pay up with signing bonuses.
- supernova87a 3y agoPossibly. But personally, I don't think the generosity of any severance package is a deal-breaking factor in most people's decisions to work for a company or not. Or for most people getting a job offer, that the company has reneged on some recent offers -- there are far more fundamental questions than those specific actions.
- lowbloodsugar 3y agoIt is when the ship is sinking and the remaining people are deciding if they too should jump.
- throwaway5959 3y agoThis isn’t great optics: https://archive.ph/pxy91 https://archive.ph/pxy91 Serious question: with how much instability there is with this company, why would anyone want to work there? Are they the best in their business and just have hit a rough spot? Why is Flexport so commonly discussed here?
- p1esk 3y agowhy would anyone want to work there? Because they can’t get offers elsewhere?
- toomuchtodo 3y agoA colleague who had an engineering manager offer from Flexport rescinded was able to find an alternative offer in less than ~2 weeks. n=1. Regardless of reason why someone wants to work at an org, it's likely they can find gainful employment elsewhere.
- p1esk 3y agoThere are what seems to be weekly Ask HN posts about how someone can’t get an interview in months of trying and a bunch of people reply confirming that “things are bad right now”. If I was laid off and been sending my resume out for the last six months without any success I’d not be picky.
- vuln 3y agoThere’s also monthly “who is hiring” and “who wants to be hired” these post typically have hundreds of comments. I don’t sit on the site all day but I haven’t seen the regularity of posts you’re speaking of.
- toomuchtodo 3y agoIndeed, and you shouldn't be picky when you can't afford to be. But! You should also be networking and looking for your next job on day 1 at your current job. Reputation and network gets you hired, and throwing resumes into the abyss is suboptimal. If you do not have a list of former and current colleagues you could reach out to today and be confident that they could either refer you into a role or connect you to someone who can, I highly recommend fixing that over the long term. This also enables you to consistently negotiate from a position of power (another gig is your BATNA). This is not to say you won't get hired by applying through a website career page, LinkedIn, an ATS, whatever, but having a strong network will always win vs pipeline luck. Some people are just not good at interviewing, and some are simply not a fit for the role.
- imran-iq 3y agoSo shopify cut its logistics to flexport, who are now cutting 20% of its company. Must be really shitty to anyone unlucky enough to go through that :(
- sciurus 3y agoFor anyone who missed it: https://news.shopify.com/shopify-completes-sale-of-shopify-logistics-to-flexport# https://news.shopify.com/shopify-completes-sale-of-shopify-l...
- pjd7 3y agohttps://www.freightwaves.com/news/flexport-to-launch-eastern-airlines-777-express-freighter-service https://www.freightwaves.com/news/flexport-to-launch-eastern... The leasing or contracts on the air freight must be a bit of a problem if shopify has trimmed their business to flexport. Probably needs to free up cashflow to cover the expenses. Wonder how the % of business shopify was for flexport.
- deleted 3y ago[deleted]
- renewiltord 3y agoChecks out. He hired a many person company guy to take over his few person company. The many person company guy tried to make the few person company a many person company. He then went to Burning Man. On hella psychedelics, he had the full realization that his tweet quality tended to zero after he decided on content marketing to pump up his Founder's Fund deal flow which should be near infinite in the first place and that his FF work is not as important as his company. So he came back from Burning Man to his company and fired the many person company guy he got and decided to take the reins and run it like he would: lean and green. I'm positive this is what happened and you can't make me believe anything else.
- frellus 3y agoOuch, after a prior 20% cut in January. https://www.flexport.com/blog/flexport-co-ceos-note-to-employees/ https://www.flexport.com/blog/flexport-co-ceos-note-to-emplo... Layoffs suck, they drain the moral when things are already hard and negative feeling. This is why it's critical to celebrate wins as often as being transparent about disappointing news.
- florin_g 3y ago[flagged]
- rnk 3y agoCan you explain what you are getting it with this comment? Somehow the plumber is doing real work and flexport has a bunch of lazy bums, or that would be beter than working at flexport financially?
- florin_g 3y agoIt's not about bums. It's about returns. My comment is so real, I can send you invoice and pictures.
- SteveNuts 3y agoWhat's stopping you from doing this since it's incredibly lucrative?
- florin_g 3y agoI mark it up. I am a builder. The point is, you need to bring measurable value.
- theGnuMe 3y agoThis works up and to the point where people can't afford it (largely due to rising interest rates). Construction/remodeling is still in insane pricing mode right now. The bigger companies will string it out by offering financing but even that is limited again due to interest rates.
- ZephyrBlu 3y agoTech companies are structurally different to the plumbing/building business, you can't make this comparison. Plumbing and building have static value. They will always do the same thing. The value of code is highly dependent on the context. SWEs are highly paid because they can create systems which can be reused and built upon over time. Hiring an engineer to build a system doesn't make sense when it handles $0 in GMV, but makes a lot of sense when it handles millions in GMV. Tech companies are asymmetric bets.
- Aeolun 3y agoAt some point I had a good impression of Flexport (right when they were starting out). It was a bit ruined after a call with a recruiter about their tech practices, but the public news just takes the cake.
- dshibarshin 3y agoUnfortunate, yet unsurprising. I always looked to Flexport to drive the logistics industry forward, but they are still limited by the extreme inefficiencies between ocean carriers, customs brokers, warehouses and truckers. There’s no standardized data format that can be handed off at each step without human involvement. It would be optimal to have an algorithm handle the ocean freight, import clearance, and booking the warehouse and trucker to handle it from there. Maersk took a shot at a standardized data system and called it quits due to limited support. But Maersk does have a platform offering realtime rates on container bookings on their own vessels, import clearance, and trucking through their platform. I believe other carriers like MSC and ONE-Line are following this approach to get their customers on board. What’s promising is that if one major carrier does succeed with a standardized data process, they can more easily integrate it within the ocean carrier alliance that they are part of. The 3 major ocean carrier alliances control 83% of global capacity. This seems like a more straightforward way to take a stab at setting a standard for millions of containers moving worldwide. Large companies would plug in and to manage their supply chains using their logistics suite, and smaller companies would simply use the ocean carriers dashboards. For now it appears that it’s still cheaper to hire from the worldwide supply of low paid logistics workers than it is to get everyone on a unified system.
- hef19898 3y agoNot really sure what you are talking about. The standardized data format, one that works from Rotterdam to the Gobi desert, is paper. These papers are standardized for sea and air freight world wide, road paper work is stanardized e.g. across Europe. There are systems that link all those parties together, available as SaaS of the shelf, and used by giants like DHL. What people don't see, tech only gets you that far in logistics until information disparity and people-business problems hit you.
- kyleee 3y agoThey’re just righting the ship