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I’ve seen this twice. First time the PE firm installed their CEO who came in and immediately started talking about cleaning house. A bunch of developers left fe

I’ve seen this twice. First time the PE firm installed their CEO who came in and immediately started talking about cleaning house. A bunch of developers left fearing a layoff. That was bad enough, but what he really meant was sales. He gutted the sales team and brought in his guys. Sales tanked, company growth stopped, hard. Features dwindled and bugs grew. This clown and his cronies were gone after two years and the company still struggles today. Second time. A $10B company acquired a $4B company. The parent demanded high margins from the company that had been running on low margins and legacy, near end of life applications. Layoffs ensued and the parent was choking on the acquisition. They’d been sold on a bogus modernization effort that ended as soon as the acquisition closed. That acquisition is a drag on their earnings today, six years later. Getting to see these type of disasters first hand is pretty cool imo.

Mandatum 4y ago
MuleSoft?
- le-mark 4y ago
  Not mulesoft, in this case at least.
BMc2020 4y ago
Reminds me a a company I worked at, I can't say it's name, let's just say it rhymes with Dewlett Dackard. 1) Start with a $55 billion dollar company... 2) Hire a new CEO and cronies that are going to make miracles happen with with a very expensive acquisition of another company. 3) 18 months later the miracles have not happened. CEO and cronies are invited to leave with very generous golden parachutes. 4) Start with a $50 billion dollar company...
- hinkley 4y ago
  “The best way to create a small fortune in X is to start off with a large fortune.”
- thejosh 4y ago
  I also love the excuse for the last 3 years for anyone who made massive f'ups. "The last few years have been unprecedented times".
  - AussieWog93 4y ago
    I've always suspected that the primary reason so many small businesses shut down during recessions (or large businesses lay off huge amounts of staff) doesn't actually have anything to do with cashflow but instead the fact that management can save face by blaming the economy at large.
    - nerdponx 4y ago
      Isn't it somewhat well known that mass layoffs happen in recessions so that management can blame the recession?
  - Spooky23 4y ago
    Meanwhile, competent people are rolling in cash.
- kylehotchkiss 4y ago
  I recently purchased a Drinter from them. Wirecutter recommended it. I even signed up for Dewlett Dackard Plus since it sounded like a better deal than buying ink on its own.
- swyx 4y ago
  only $5b of value destruction isn't bad, considering the possible range of outcomes
chii 4y ago
>He gutted the sales team and brought in his guys. Sales tanked, company growth stopped, hard. Features dwindled and bugs grew. how does a changed sales team cause features to dwindle and bugs? it's more likely that management attitudes changed when acquisitions happen - and that new attitude doesn't foster an environment in which good code gets written. It wouldn't have mattered if the sales team changed or not imho.
- kqr 4y ago
  > how does a changed sales team cause features to dwindle and bugs? I can think of at least two ways: 1. In many companies, sales is an important part of the window to the customer. Sales interprets customer desires and forwards them to product management. 2. If revenue drops, the company may need to cut costs too, and one stupid way to do this is to reduce development spending.
- wlesieutre 4y ago
  The previous sentence mentioned that developers had bailed thinking they’d be hit by the layoffs, one imagines that was part of it
AdrianB1 4y ago
If anyone remembers, Gillette was bought ~ 15 years ago and the decision was to move everyone from Boston to Cincinnati; they lost ~ 80% of the people in Boston with that single requirement. A bit more than 10 years later, a wise decision to piss on their customers wiped 8 billion from the brand. Now Gillette is just a ghost of what it used to be. in both cases, the company doing the acquisition was making dumb decisions.
that_guy_iain 4y ago
> Getting to see these type of disasters first hand is pretty cool imo. I've literally just got to watch a company get ran into the ground by the new owners. Learnt a bunch and once the legal stuff is over I'll have an amazing blog post to write. In a few sentences. Tech Side: A company decides to rewrite an application in 3-months, it takes 18-months and couldn't even invoice all the customers upon release. Biz Side: The company has a "better" strategy created for it by people who don't understand the industry after all the original business people fleed and then starts having to do all the stuff the original people were doing.

Mandatum 4y ago

MuleSoft?

le-mark 4y ago
Not mulesoft, in this case at least.

BMc2020 4y ago

Reminds me a a company I worked at, I can't say it's name, let's just say it rhymes with Dewlett Dackard. 1) Start with a $55 billion dollar company... 2) Hire a new CEO and cronies that are going to make miracles happen with with a very expensive acquisition of another company. 3) 18 months later the miracles have not happened. CEO and cronies are invited to leave with very generous golden parachutes. 4) Start with a $50 billion dollar company...

hinkley 4y ago
“The best way to create a small fortune in X is to start off with a large fortune.”
thejosh 4y ago
I also love the excuse for the last 3 years for anyone who made massive f'ups. "The last few years have been unprecedented times".
- AussieWog93 4y ago
  I've always suspected that the primary reason so many small businesses shut down during recessions (or large businesses lay off huge amounts of staff) doesn't actually have anything to do with cashflow but instead the fact that management can save face by blaming the economy at large.
  - nerdponx 4y ago
    Isn't it somewhat well known that mass layoffs happen in recessions so that management can blame the recession?
- Spooky23 4y ago
  Meanwhile, competent people are rolling in cash.
kylehotchkiss 4y ago
I recently purchased a Drinter from them. Wirecutter recommended it. I even signed up for Dewlett Dackard Plus since it sounded like a better deal than buying ink on its own.
swyx 4y ago
only $5b of value destruction isn't bad, considering the possible range of outcomes

chii 4y ago

>He gutted the sales team and brought in his guys. Sales tanked, company growth stopped, hard. Features dwindled and bugs grew. how does a changed sales team cause features to dwindle and bugs? it's more likely that management attitudes changed when acquisitions happen - and that new attitude doesn't foster an environment in which good code gets written. It wouldn't have mattered if the sales team changed or not imho.

kqr 4y ago
> how does a changed sales team cause features to dwindle and bugs? I can think of at least two ways: 1. In many companies, sales is an important part of the window to the customer. Sales interprets customer desires and forwards them to product management. 2. If revenue drops, the company may need to cut costs too, and one stupid way to do this is to reduce development spending.
wlesieutre 4y ago
The previous sentence mentioned that developers had bailed thinking they’d be hit by the layoffs, one imagines that was part of it

AdrianB1 4y ago

If anyone remembers, Gillette was bought ~ 15 years ago and the decision was to move everyone from Boston to Cincinnati; they lost ~ 80% of the people in Boston with that single requirement. A bit more than 10 years later, a wise decision to piss on their customers wiped 8 billion from the brand. Now Gillette is just a ghost of what it used to be. in both cases, the company doing the acquisition was making dumb decisions.

that_guy_iain 4y ago

> Getting to see these type of disasters first hand is pretty cool imo. I've literally just got to watch a company get ran into the ground by the new owners. Learnt a bunch and once the legal stuff is over I'll have an amazing blog post to write. In a few sentences. Tech Side: A company decides to rewrite an application in 3-months, it takes 18-months and couldn't even invoice all the customers upon release. Biz Side: The company has a "better" strategy created for it by people who don't understand the industry after all the original business people fleed and then starts having to do all the stuff the original people were doing.