Hi everyone. Welcome to Plaintext, the newsletter that’s cheaper than a blue check mark—and guaranteed bot-free!
The Plain View
This was the month when Big Tech got smaller. The leader in the shrinkage was a troubled Twitter, led by a new owner who, after trying to weasel out of his $44 billion commitment to buy the firm, has thrown himself into the task of fixing its problems. Job One was getting rid of half the workers behind the money-losing platform. But Twitter was far from alone in stripping employees of their salaries, health plans, and email addresses. Stripe, only recently seen as the gold standard of rising deca-unicorns, cut 14 percent of its staff. Intel chipped off 20 percent. Robinhood booted almost a fourth of its workers. Lyft lifted 13 percent of its staff off the rolls. Shopify discounted a tenth of its 1,000 headcount. Snap disappeared a fifth of its people. The unkindest cut of all, at least in volume, came from Meta. Mark Zuckerberg gave 11,000 workers an opportunity to share the “badge posts” that outgoing workers write upon leaving the Frank Gehry-designed building. Apple and Amazon simply announced hiring freezes.
The number of newly out-of-work techies from this recent purge is probably well into six figures. But numbers don’t tell the full story. The most valuable asset at a tech company is talent. I have sat through endless diatribes at events for prospective founders, like Y Combinator’s Startup School, where peach-fuzzed moguls drill into people a quarter-generation behind them that the biggest screwup you can make is hiring the wrong person, and that glory comes to those who resist filling posts with anything less than superstars. That mantra extends not only to the tiniest garage-based startup but industry goliaths as well. Anyone who has ever applied for a job at a hot tech firm, or even a lukewarm one, knows that a brutal obstacle course lies between application and orientation. Candidates often must endure weeks of interviews, coding tests, and CIA-level scrutiny of their past. At one point Google, whose hiring was personally overseen by cofounder Larry Page, would go over applicant’s college transcripts with a comb so fine-toothed that it could pick off lice. Why did you get a C in that course? Unless you had a good excuse—“Uh, my mother died that semester?”—forget about getting those free meals at the Googleplex cafeteria.
Given that ordeal, you would think that actually landing a Big Tech job would earn you the status of a made man in the Cosa Nostra. But this week’s message is that when the bottom line finds a new bottom, or dark clouds gather on the economic horizon, companies are willing to write off that investment in talent and kick their most valuable assets into the street. In tech, the only untouchables are those at the very top. Mark Zuckerberg may say he’s accountable for the bloated staffing that led to the massive layoff he ordered—but pulling the paychecks from 11,000 people boosted Meta’s stock price 7 percent in a day, bloating Zuck’s bank account by several additional billion.
But here’s the irony. While the economy reliably fluctuates between boom and bust, and valuations rise and fall on Wall Street’s whims, the technology itself goes in only one direction. Connection speeds get faster, chips get more capacity, and rocket ships get more reliably reusable. Generative AI models don’t degenerate because advertisers are skittish or creepy equity people force themselves onto some company’s board of directors. They just get smarter and scarier.