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Another indicator consumer spending is dropping and costs are going through the roof. This is probably the first of a bunch of layoffs sadly. I expect Finances

Another indicator consumer spending is dropping and costs are going through the roof. This is probably the first of a bunch of layoffs sadly. I expect Finances (Banks / Mortgage providers) are going to be aggressively reducing headcounts in the near future. One side of my family is heavily in that industry and they're all extremely nervous. Sorry for anyone that lost their role, it's always tough to lose a job regardless of the company they worked for. I wish them all success and luck finding their next endeavor.

jdmoreira 4y ago
This is most likely not related to cash flows. This seems to be a preemptive strategic layoff to cut costs in preparation of tougher times to raise money / higher interest rates.
- datalopers 4y ago
  Klarna’s income is tied to consumer discretionary spending which is falling off a cliff.
  - sharken 4y ago
    With COVID becoming just another disease and the uncertainty from the war in Ukraine, it will only be worse from now on for consumer spending. A lasting peace for Ukraine needs to happen before that will change. And with Ukraine not willing to give any territory to Russia, that peace seems very far off. A coup in Russia could change that, but a coup seems very unlikely.
    - vinyl7 4y ago
      This has nothing to do with Ukraine, and everything to do with inflation and insane increases in the cost of everything.
      - codefreeordie 4y ago
        It has a little bit to do with Ukraine, insofar as energy is having its own shortage exacerbated by the conflict on top of the massive inflation that would probably create demand destruction all on its own.
  - wbsss4412 4y ago
    Consumer spending is continuing to steadily grow.[0] [0] https://fred.stlouisfed.org/series/PCEC96 https://fred.stlouisfed.org/series/PCEC96
    - lljk_kennedy 4y ago
      That seems to stop showing any data later than Mar 2022?
      - wbsss4412 4y ago
        That’s true, it doesn’t capture data from the last two months. The trends in market valuations have been consistent for several months now though, going back into last year. Whereas any collapse in consumer spending has yet to manifest itself for any longer than a month and a half.
    - datalopers 4y ago
      Look at volumes, not just $. Volumes are down Y/Y while $ is just slightly positive due to inflation. Or just look at Target’s Q1 results and guidance from last week.
      - wbsss4412 4y ago
        The chart I linked is inflation adjusted.
ushakov 4y ago
look out for yourselves too startups can’t exist without free vc cash that’s going to be tight soon-ish
- ganoushoreilly 4y ago
  Oh for sure, if you're not cashflow positive and are looking for Series A / Series B I expect to see the purse strings tightening up hard. Already have a few friends at firms saying they're having to be more restrictive / selective than before. I can throw a stone to about 15 startups near where i'm at that are all in tight cash mode already, not really making a whole lot and are hoping for a big raise. None of them that I know personally have metrics that will pass the test. :(

jdmoreira 4y ago

This is most likely not related to cash flows. This seems to be a preemptive strategic layoff to cut costs in preparation of tougher times to raise money / higher interest rates.

datalopers 4y ago
Klarna’s income is tied to consumer discretionary spending which is falling off a cliff.
- sharken 4y ago
  With COVID becoming just another disease and the uncertainty from the war in Ukraine, it will only be worse from now on for consumer spending. A lasting peace for Ukraine needs to happen before that will change. And with Ukraine not willing to give any territory to Russia, that peace seems very far off. A coup in Russia could change that, but a coup seems very unlikely.
  - vinyl7 4y ago
    This has nothing to do with Ukraine, and everything to do with inflation and insane increases in the cost of everything.
    - codefreeordie 4y ago
      It has a little bit to do with Ukraine, insofar as energy is having its own shortage exacerbated by the conflict on top of the massive inflation that would probably create demand destruction all on its own.
- wbsss4412 4y ago
  Consumer spending is continuing to steadily grow.[0] [0] https://fred.stlouisfed.org/series/PCEC96 https://fred.stlouisfed.org/series/PCEC96
  - lljk_kennedy 4y ago
    That seems to stop showing any data later than Mar 2022?
    - wbsss4412 4y ago
      That’s true, it doesn’t capture data from the last two months. The trends in market valuations have been consistent for several months now though, going back into last year. Whereas any collapse in consumer spending has yet to manifest itself for any longer than a month and a half.
  - datalopers 4y ago
    Look at volumes, not just $. Volumes are down Y/Y while $ is just slightly positive due to inflation. Or just look at Target’s Q1 results and guidance from last week.
    - wbsss4412 4y ago
      The chart I linked is inflation adjusted.

ushakov 4y ago

look out for yourselves too startups can’t exist without free vc cash that’s going to be tight soon-ish

ganoushoreilly 4y ago
Oh for sure, if you're not cashflow positive and are looking for Series A / Series B I expect to see the purse strings tightening up hard. Already have a few friends at firms saying they're having to be more restrictive / selective than before. I can throw a stone to about 15 startups near where i'm at that are all in tight cash mode already, not really making a whole lot and are hoping for a big raise. None of them that I know personally have metrics that will pass the test. :(