There’s no such thing as a perfect layoff

Photo by Aarón Blanco Tejedor on Unsplash

Dear readers,

Covid-19 continues to wreak havoc on the economy, and founders are forced to find ways to reduce burn and extend runway. As a result, layoffs have become increasingly common among tech companies, and there’s a lot of advice floating around on how best to do it.

Common tips include:

• Do it fast and communicate transparently.
• Do it once and do it well. Don’t suffer death by a thousand cuts.
• Be humane. Speak with everyone personally and help them move on as soon as possible.

While these are sound suggestions that founders should consider, I don’t believe there’s a perfect layoff plan. Carrying out layoffs is like cutting off an arm to save the whole body. You know you have to do it, but just the thought of it and the act itself will hurt a great deal no matter how much you prepare for it. After the surgery, you will need time to heal and so your body can get used to its new normal.

We cover a fair bit of layoff-related stories and regularly receive letters from employees complaining about their employers. By sharing my thoughts candidly, I hope to provide some helpful perspectives during this difficult period:

1. It’s likely our first time to experience a layoff.

What goes up must come down. And hey, even a titan like Alibaba once went through a rough patch.

We enjoyed a tech boom that lasted for almost 10 years. Even if Covid-19 didn’t happen, a market correction was imminent. Most companies were set up less than a decade ago, so this pandemic is likely the first big challenge we’re facing. And for many founders, this is probably the first time that they have to let go of staff.

The same goes for the relatively young employees in tech – this is probably their first encounter with layoffs. And just like any kind of breakup, the outcome tends to be unpleasant, no matter how well we plan it out.

2. It is OK to be angry or upset.

No one likes layoffs – not the executor and definitely not the receiver. So it’s OK to be upset or get angry. Take your time to grieve, but don’t do anything that may jeopardize your future.

The best people I know always look at the bright side of life and move on to their next adventure. There are three zones you can live in and you get to choose where you want to be:

1. Fear zone (unhealthiest): You think that life is unfair, so you complain and forward all the silly messages you can find.
2. Learning zone (healthy): You recognize that this is happening to everyone. This enables you to identify your emotions and become aware of the situation.
3. Growth zone (healthiest): You’re patient and on the lookout for opportunities. You’re making good use of your time.

Don’t forget the colleagues who are still at the company. It’s hard for those who are going, but it also ain’t easy for those who are staying. It helps to leave with gratitude in your heart.

3. Founders have to be transparent.

4. There’s no one-size-fits-all severance package.

5. There’s no perfect layoff plan.

6. Our July 2018 layoff wasn’t perfect, either.