🥽11,000 Meta Employees Laid Off
Severance packages in the Metaverse: Context Collapse #169
In this issue: Making sense of Meta layoffs / Twitter leadership chaos / Twitter having trouble getting advertisers to trust them / DOJ investigating Adobe-Figma acquisition / Class divides and political advertising / Puck reaches 200,000 paying subscribers / Eater expanding into print books / More.
Hey! Welcome to the latest Context Collapse. We’re publishing this on Thursday, ahead of the holiday weekend and a weird, rare Friday Veteran’s Day.
Speaking of that, donate some money to Iraq and Afghanistan Veterans of America. They’re out there doing the good work.
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So…
Meta, Facebook’s parent company, just laid off more than 11,000 employees. This is huge news.
Facebook didn’t even employ 11,000 people in 2014. But as of the end of September, Meta employs more than 87,000 people (which doesn’t include a large army of contractors who work on everything from content moderation to customer service). Zuckerberg’s original Harvard Hot Or Not clone has grown into a giant technology and communications company that encompasses three of the world’s most-used communications platforms (Facebook, Instagram and WhatsApp), an absolutely massive advertising business, several divisions focused on virtual reality, augmented reality and immersive digital worlds, and a host of other efforts.
Meta’s last quarterly earnings report says that Reality Labs, Meta’s metaverse division, had $3.67 billion in operating losses. That’s a lot of money.
But let’s take a macro view. There are three things you need to keep in mind for the tech sector1:
Booms and busts are cyclical. Tech is more fickle than, say, consumer packaged goods but less fickle than, say, energy. Nonetheless one company seeing rainclouds on the horizon means lots of companies see rainclouds on the horizon.
Tech CEOs aren’t Gods Walking The Earth. CEOs (and upper management in general) aren’t Ayn Rand heros. They’re ordinary humans who make mistakes in their personal and professional lives. Sometimes they bet on the wrong horse. Maybe banking Meta’s entire future on immersive digital worlds in 2022 when the technology isn’t there yet wasn’t a great idea! Who knows! Blockchain token singularity! I don’t know, do you?!
COVID disrupted the informal tech company-employee compact. Pre-COVID, there was an unspoken2 compact between rank-and-file employees and the large companies like Facebook, Google, Apple and Intel they worked for. In exchange for employees working extremely long hours at the many corporate office parks dotting the peninsula, large companies would pay extremely high salaries (and stock options in many cases) and offer generous perks that essentially allowed employees to outsource huge portions of their life such as cooking, homecleaning and childcare to third-party companies. That compact was broken by the whole global pandemic thing/employees discovering they liked working from home in many cases and who the heck knows what is coming next.
I have no doubt that the vast majority of laid off Meta employees will land back on their feet. I’m not minimizing the layoffs—I’ve been laid off before and it sucks. It also looks like a whole bunch of companies are laying off employees. Twitter just did their bloodbath last week and there have just been layoffs at Lyft, Netflix, Redfin and a bunch of other companies.
2022! It’s a weird year.
Other stuff on my radar:
Casey Newton reports that Twitter’s CISO, chief privacy officer and chief compliance officer all resigned last night and that an employee says it will be up to engineers to “self-certify compliance with FTC requirements and other laws.” Yikes!
Netflix is going all-in on advertising.
Food site Eater is releasing a series of print books.
The Justice Department is investigating Adobe’s acquisition of Figma.
Roku’s warning of a tough season for ads on streaming television.
Email magazine outlet Puck now has 200,000 paying subscribers. Love this business model.
This article by VC Erik Torenberg (written pre-election) on class divides and political realignments.
Advertisers are halting their ad buys on Twitter because noone has an idea what the heck top management is doing.
Speaking of that, Mike Masnick has some advice for Elon Musk as he speedruns the content moderation learning curve.
And, finally for this week, Rebecca Jennings at Vox takes a good look at the market for ghostwriters for LinkedIn posts.3
Disclaimer: I hate the idea of the “tech sector.” Having a huge bucket where you place enterprise software companies like Salesforce, hardware companies like Apple and conglomorates like Alphabet always seemed like a really bad idea. Nonetheless, it’s an easy shorthand that you can use with investors or regulators and they instantly know what you’re talking about. Thus, you’re stuck with the idea of the “tech sector.”
And sometimes spoken.
At Ungerleider Works, we work on ghostwritten LinkedIn posts (as well as op-eds and investor/customer letters) for multiple clients. In all cases, we’ve helped our clients reach goals like funding rounds, attracting large corporate consumers for B2B and getting on the radars of influential industry analysts and it’s been pretty awesome.