2 ms·

It seems a little odd to do this 3 days before Christmas. Holiday depression is already a real problem, and making people unemployed a few days before the holid

It seems a little odd to do this 3 days before Christmas. Holiday depression is already a real problem, and making people unemployed a few days before the holiday sounds like a bad thing. And it's a terrible time to be job hunting. Why not hold on a few more weeks, let employees enjoy the holidays and announce in mid-January when employees can actually talk to hiring managers and get some good job prospects instead of being met with out of office messages?

mangeletti 10y ago
It's likely that people within the organization already knew things weren't going well. So, the bright side of this is that: A) employees can spend the entire holiday week or two with their families, and B) employees can start out their new year unencumbered by the stress of working for a failing company Personally, I'd rather have it this way than come back from whatever fun holiday adventure I'm on to find out a week later that I'm losing my job... that's a terrible way to start the year's momentum.
- Johnny555 10y ago
  Sure, there could be mitigating circumstances, but I've worked for a startup that folded just after Christmas while the office was closed for the holiday, we were all fired by phone. It sucked. Spending the holidays with family can be even more stress inducing when you've just learned that you lost your job. No ability to go out with local friends or former coworkers to commiserate about being fired and talk about job prospects. I was too distracted with job searching to really relax and enjoy time with family. Rumor was that the investors pulled the plug before the end of the year for tax reasons, but I'm skeptical since it took months to sell off assets (physical and virtual) and wind down the business. I made out pretty well though, got a lucrative contract with the company that bought the core software to keep it running for them until they could merge it into their systems.
- ryao 10y ago
  I am not sure if even the CEO knew that sufficient venture capital to succeed was unavailable until all avenues had been exhausted. I had a hint that things were not going well when my request for equipment was denied until round B funding was raised.
colinbartlett 10y ago
Well, you don't know the exact circumstances. Maybe there's no money in the bank and they couldn't raise more investment and they did the best they could to stretch it out to the New Year? Or maybe they're giving everyone 3 months severance in which case, it might not be so bad to get a Christmas gift of pay without work.
ThrustVectoring 10y ago
Given that the venture will fail anyways, it's always better to figure this out sooner rather than later. Like, take the money that would have been spent on salary for those extra weeks, and pay it out as severance. There's arguments to be made for stretching things out if it means funds get spent as salary rather than paying things back to investors, but this is an allocational waste (employees do work for no real benefit) for a distributive gain (employees get money rather than investors).
hoodoof 10y ago
Because a day in business costs money. If the company is out of money then you shut it down regardless of anything at all. Running for a single day longer only makes the problem worse and presumably spends money that does not exist - someone needs to pay the money the employees earn. Keeping people feeling nice isn't how to run a business that is at the endpoint of its lifecycle.
- ryao 10y ago
  I understand that the investors have agreed to pay all former employees severance pay. I am one of those former employees. That helped somewhat.
blazespin 10y ago
How do you magically hold on a few more weeks? Is there some magical startup christmas pay holiday fund I don't know about? Or are you proposing to just string them along and simply not pay them in the new year?
ryao 10y ago
It was 4 days before Christmas. We were all let go yesterday. The announcement was written sometime between then and now.
bkanber 10y ago
They shut down because they couldn't secure series B funding. It's likely that they couldn't both make next payroll and also deal with severance and shutdown costs. Hard to hold on for a few more weeks if you can't actually pay anyone.
Fzzr 10y ago
If the company is shutting down no matter what, keeping the employees on is essentially giving away money for no (business) reason. To do so could be construed as a violation of fiduciary duty to the shareholders. Alternately, who says they have the money to make payroll either way? Keeping them employed when you know there is no money to pay them would be even worse. It would leave them just as unpaid, but also even more bitter about it.

mangeletti 10y ago

It's likely that people within the organization already knew things weren't going well. So, the bright side of this is that: A) employees can spend the entire holiday week or two with their families, and B) employees can start out their new year unencumbered by the stress of working for a failing company Personally, I'd rather have it this way than come back from whatever fun holiday adventure I'm on to find out a week later that I'm losing my job... that's a terrible way to start the year's momentum.

Johnny555 10y ago
Sure, there could be mitigating circumstances, but I've worked for a startup that folded just after Christmas while the office was closed for the holiday, we were all fired by phone. It sucked. Spending the holidays with family can be even more stress inducing when you've just learned that you lost your job. No ability to go out with local friends or former coworkers to commiserate about being fired and talk about job prospects. I was too distracted with job searching to really relax and enjoy time with family. Rumor was that the investors pulled the plug before the end of the year for tax reasons, but I'm skeptical since it took months to sell off assets (physical and virtual) and wind down the business. I made out pretty well though, got a lucrative contract with the company that bought the core software to keep it running for them until they could merge it into their systems.
ryao 10y ago
I am not sure if even the CEO knew that sufficient venture capital to succeed was unavailable until all avenues had been exhausted. I had a hint that things were not going well when my request for equipment was denied until round B funding was raised.

colinbartlett 10y ago

Well, you don't know the exact circumstances. Maybe there's no money in the bank and they couldn't raise more investment and they did the best they could to stretch it out to the New Year? Or maybe they're giving everyone 3 months severance in which case, it might not be so bad to get a Christmas gift of pay without work.

ThrustVectoring 10y ago

Given that the venture will fail anyways, it's always better to figure this out sooner rather than later. Like, take the money that would have been spent on salary for those extra weeks, and pay it out as severance. There's arguments to be made for stretching things out if it means funds get spent as salary rather than paying things back to investors, but this is an allocational waste (employees do work for no real benefit) for a distributive gain (employees get money rather than investors).

hoodoof 10y ago

Because a day in business costs money. If the company is out of money then you shut it down regardless of anything at all. Running for a single day longer only makes the problem worse and presumably spends money that does not exist - someone needs to pay the money the employees earn. Keeping people feeling nice isn't how to run a business that is at the endpoint of its lifecycle.

ryao 10y ago
I understand that the investors have agreed to pay all former employees severance pay. I am one of those former employees. That helped somewhat.

blazespin 10y ago

How do you magically hold on a few more weeks? Is there some magical startup christmas pay holiday fund I don't know about? Or are you proposing to just string them along and simply not pay them in the new year?

ryao 10y ago

It was 4 days before Christmas. We were all let go yesterday. The announcement was written sometime between then and now.

bkanber 10y ago

They shut down because they couldn't secure series B funding. It's likely that they couldn't both make next payroll and also deal with severance and shutdown costs. Hard to hold on for a few more weeks if you can't actually pay anyone.

Fzzr 10y ago

If the company is shutting down no matter what, keeping the employees on is essentially giving away money for no (business) reason. To do so could be construed as a violation of fiduciary duty to the shareholders. Alternately, who says they have the money to make payroll either way? Keeping them employed when you know there is no money to pay them would be even worse. It would leave them just as unpaid, but also even more bitter about it.