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Salesforce Lays Off 8k While Paying Matthew McConaughey $10M/Yr to Sit Around

190 points by ppjim 4y ago

fdgsdfogijq 4y ago
This is just a natural reality of capitalism. Some "workers" produce much more value than others. A coder making 150-200k is completely replaceable, a widely recognized public figure is not. Shouldn't be shocking, whats shocking is that people don't understand this and arent honest with themselves about the value they bring to the workplace
- nordsieck 4y ago
  > whats shocking is that people don't understand this and arent honest with themselves about the value they bring to the workplace The labor theory of value[1] is still a very popular belief. Even though it doesn't work very well if you poke it at all. --- 1. https://en.wikipedia.org/wiki/Labor_theory_of_value https://en.wikipedia.org/wiki/Labor_theory_of_value
- satellites 4y ago
  Yes, I’m sure an actor adds more real value to a SaaS company than engineers do. Recognizable talking heads who read lines into a camera are famously hard to find.
  - adamwong246 4y ago
    given the hype-driven nature of our industry, that may well be the case.
  - notmindthegap 4y ago
    "Real value" is an attempt to draw a distinction where there isn't one. Kim Kardashian brings in more "real value" to a clothing company than any one seamstress. Welcome to marketing.
    - anonymouskimmer 4y ago
      And yet a bad seamstress can tank a clothing company if a single bad article of clothing gets into the wrong hands. This kind of makes Kim K a safer play than a bad seamstress. As unless you go full Kanye a spokesmodel isn't going to tank a company.
      - wongarsu 4y ago
        A single bad seamstress causing bad clothing to be delivered to customers is a process failure, the same way no single engineer should be responsible for Saleforce's production systems going down. And in most ways, implementing quality control on your product is a lot easier than controlling the personal life of your spokespeople.
        anonymouskimmer 4y ago
        Any company that's paying $10M to a spokesperson will have (maybe I should say "should have") a lot of employees dedicated to that spokesperson and the campaign. They might have a clawback clause if the spokesperson shows bad judgement, and can also get some additional good marketing if they are proactive in distancing themselves from their Kanye-esque spokesperson. So I guess, like you say, there is a quality control process regardless. I think the larger issues are probably the decisions of the pre-seamstress process employees. Bad choices in materials or cost-savings measures can turn off customers.
  - paxys 4y ago
    If an actor can directly bring more revenue to the business than an engineer then yes, they are adding more real value.
  - tekla 4y ago
    Probably does. Most engineers are fungible
- amitrip 4y ago
  what does a public recognized figure produce?
  - ethbr0 4y ago
    Sales.
    - oluwie 4y ago
      Force.
- alexfromapex 4y ago
  Capitalism creates these situations but what should be talked about is disincentivizing them not that we should accept them. That is enough money for 100 workers to not be laid off for an entire year. Merits a discussion on how much value he’s actually creating. Same goes for CEOs getting paid many millions.
  - erulabs 4y ago
    It's not possible to predict if this is a good call or not. At the end of the day, it will come out in the wash, and you can make a pretty penny betting correctly. I'm going to assume no one here thinks this decision is so foolish that it will single handedly bring about the fall of Salesforce. As soon as you stray into the land of "we should make this decision on Salesforce's behalf", you're straying into a "known-unknown", and acting as if it's obvious what the correct decision is is always the downfall of those who seek to plan society according to their morality. If you said "I accept that I don't know if this was a good move for generating profit or not, but I still don't think it should be allowed", I might be more inclined to entertain the idea!
    - alexfromapex 4y ago
      You are having a straw man argument I think. I said it merits a discussion and seems highly unethical. I have to disagree that there are appropriate situations where society should allow unethical situations to occur, unless they are extremely necessary, as that creates an unethical society which is dystopian. My way of phrasing that is that society should highly disincentivize unethical situations.
      - UncleEntity 4y ago
        If it turns out that his being a spokesman provides enough sales to employ 1000 people would that also be unethical? I have no insider knowledge of the inner working of salesforce but I can reasonably surmise that they aren’t paying him to literally sit around.
        4y ago
- banannaise 4y ago
  "That's capitalism, guess y'all gotta suffer while ten people add to their hoards, nothing we can do"
  - fdgsdfogijq 4y ago
    I'm not condoning it, just pointing out how society works
    - nickpeterson 4y ago
      I’d also point out that non-capitalist systems don’t actually correct this problem in practice, they just change the means by which wealth is acquired (usually violence).
      - nicoburns 4y ago
        It's ultimately violence in a capitalist society too (what do you think the police are for?). It's certainly possible to achieve a fairer distribution of wealth than capitalist societies produce. And before the inevitable replies: no, I'm not advocating for communism. I'm advocating for non-capitalist variants on market economies.
        nickpeterson 4y ago
        Sure, all things can be improved, and I know we don’t live in anywhere near a utopia (education, retirement ,healthcare, tort reform, all needed), but I get uncomfortable with the tone that we’re consciously choosing a bad system when the reality is that peacefully refactoring power structures and society is just hard.
        rootusrootus 4y ago
        > I'm advocating for non-capitalist variants on market economies. I'm struggling to think of a good example of a current non-capitalist market economy. Do you have one in mind? Or are you advocating for something not yet successfully created?
- anonymouskimmer 4y ago
  I think people understand it, I just think they rightfully don't care that much. They care about their income, not the particular set of justifications the powers-that-be have for their organizational schemes.
- jwilber 4y ago
  Ah yes, anyone upset that their employer’s layoffs cite financial reasons while objectively wasting money is “shockingly” ignorant to capitalism! Luckily the enlightened fdsg has brought it to our attention! Without knowing what any of them did, it’s obvious that none of them, nor in aggregate, brought any near the value to Salesforce as did one aging celebrity. Anecdotally, I’ve never seen anything associating the actor with Salesforce in any capacity. Even those I know at the company didn’t know he advertised for them. (But capitalism!)
  - nickpeterson 4y ago
    I think another lens to view this through, is a company that mismanaged their budget has two more glaring examples of mismanaging their budget.
- titzer 4y ago
  Ah yes, the smoke-and-mirrors part of capitalism, the style-but-no-substance, image-above-competence, the elitism and cronyism part straight out of Adam Smith.
- ben7799 4y ago
  I think why this rings false to many is that McConaughey is definitely extremely replaceable. If that is already sunk money and they paid it to him before the layoffs than the article is off base. But why is he at $10M not replaceable by some other celebrity who might do the work for 10x or 100x less? He has no special credibility around anything to do with Salesforce, CRM, or anything in tech. It's more likely Benioff has a man crush on him and like the fact he gets to hang out with a famous movie star and pretend he's friends with him or something and can conveniently ignore that he's kind of buying a famous friend for $10M. A really well executed ad campaign with a less famous, less expensive star might be far more effective.
- deleted 4y ago
  [deleted]
gkoberger 4y ago
For what it's worth, this deal was almost definitely signed long before the economy crashed. And he was paid to create / star in ads (I'd assume the money went to his production company, not him specifically), which I don't think is particularly unique... a lot of large billion dollar businesses hire celebrity spokespeople. EDIT: Okay, economy hasn't technically crashed, but valuations are down, funding is down, and layoffs are up. Tech companies have a very different view of money now than they did 8 months ago.
- j_walter 4y ago
  Exactly this. Financial situtions change but you still haven't to honor contracts that were signed. The 8K employees didn't have the same contracts as a long term spokesperson...that is not unusual at all...
  - runesofdoom 4y ago
    "But we had to do <terrible thing> because it's the law" isn't an excuse, just a different form of condemnation.
    - umeshunni 4y ago
      [flagged]
    - flappyeagle 4y ago
      Why is paying a celebrity spokesperson terrible?
      - notmindthegap 4y ago
        Because many of the engineers here either do not understand or are unwilling to accept that society operates in more dimensions than the technical and "rational". They see celebrity and functions like marketing and sales as inherently bullshit and unnecessary.
    - PragmaticPulp 4y ago
notmindthegap 4y ago
Is it so crazy to assume McConaughey may enable more business through his influence than 8,000 employees combined? If true, then it is justified by the argument Benioff put forward and that this article seems to also agree with.
- brianwawok 4y ago
  People really hate that. Also the secretary is not a fan that their CEO does indeed provide 4000x the value.
  - NineStarPoint 4y ago
    CEO is in the unique position of being capable of providing 4000X the value, due to being a force multiplier on the entire company (It’s the job they hold, not skill, that makes it impossible for a random secretary to have as much value to a company). On one hand, this means it is indeed worth paying a lot of money to get the best CEO you can, as small differences in skill have outsized influences on the end result. On the other hand, even the CEOs who are of neutral or negative value compared to someone you could pay 10X less still get paid 4000X more than the secretary. Anyway, long way of saying than general salaries are a race to paying as low an amount as you can to get someone of the needed skill, while CEO salaries are about paying more than strictly necessary due to the effect even a small difference has from your biggest productivity multiplier. And given that most people will never have the opportunity to enter a role where their pay starts being calculated that way, it’s unsurprising they find it unfair (even if it’s logical).
- CharlieDigital 4y ago
  To put this into perspective, assuming the average salary of the 8k employees is $125,000, that would only save 80 jobs.
  - loeg 4y ago
    Keep in mind fully loaded cost is approximately 2x salary. So maybe 40 jobs.
birdyrooster 4y ago
Should change title to Mark Benioff is not Hawaiian because I felt that point most well argued.
- vuln 4y ago
  I agree. Seems like more words spent on the Hawaiian thing than the actual story.
PragmaticPulp 4y ago
Bad optics, but even if they could break the contract (which presumably includes work/performance already done) and reallocate the funds to save jobs they’d still be laying off about 7,950 people to reach budget parity.
- s1artibartfast 4y ago
  The purpose of advertising is to bring in Revenue, and presumably Salesforce thinks this ad will bring in more than it cost.
- mdasen 4y ago
  This was my reaction as well (though it might be closer to 100-200 jobs depending on what kind of jobs were laid off; not all of Salesforce is software engineers). Though I think there is something to be said about companies spending money imprudently. It's never just that they're giving McConaughey $10M/year. Often times there's a slew of vanity expenses that aren't justifiable. I'm not saying that's necessarily the case with Salesforce, but companies spend a lot of money on things that have dubious ROI. For example, GE advertised their smart electric grid technology during the Super Bowl and licensed the Wizard of Oz for it. That's a lot of money for an ad with very dubious ROI. Who is buying smart electric grid technology? A very small handful of companies who are going to have a competitive bidding process and are already going to be aware of their options. What was the point of this commercial? To me, the most likely explanation is executive vanity. They want their friends and peers to be impressed by their company and by extension themselves. If they're working on something invisible and behind the scenes, they aren't going to get the same recognition and acclaim. Companies sponsor sports stadiums and sometimes you can't even really buy their product. Highmark sponsors the Buffalo Bills stadium, but most people get their insurance via their employer and don't have a choice. Xcel Energy sponsors the NHL stadium of the Minnesota Wild and most of their business is as the monopoly electric/natural-gas transmission provider in the area. Are they trying to convince people "you don't want to live off the grid! Life is better with electricity and heating!" And yes, these companies do have some amount of business that is consumer choice, but given how much of their business has zero consumer decision-making, it seems like their ROI on advertising and sponsorships would be terribly low. Consumers do decide on many things - what soda brand to buy, what smartphone to use, what clothes to wear, what car insurance to get, etc. However, we see companies spending lots of money on things that have really dubious justification - beyond the vanity of executives. I don't know much about Salesforce and what they're spending money on, but I do think there's a reasonable question of whether McConaughey's $10M is part of a larger trend of imprudent, potentially vanity-driven spending.
deleted 4y ago
[deleted]
umeshunni 4y ago
[flagged]
paxys 4y ago
"Company" = Salesforce, which is a name I'm sure people over here recognize, so we can swap it out in the title. There's also little value in pushing this clickbait style journalism to the front page. First of all, it is objectively incorrect: > Per the WSJ, the company will be letting go of 8,000 members from its massive workforce The layoffs they are referring to happened in early January. They are not laying off another 8000 employees. Beyond that, they paid an A-list actor $10M out of their marketing budget not to "sit around" but to do a set of commercials (one of which aired at the Superbowl). Considering they exceeded all analyst expectations for revenue and profits in the last quarter, it's safe to say that some of their effort is working. Enlightened engineers don't like to admit it, but advertising works, and is a critical part of running any business. The fact that they also decided that 8K out of the 25K+ employees hired during the pandemic were redundant has nothing to do with Matthew McConaughey.
- eunoia 4y ago
  > Considering they exceeded all analyst expectations for revenue and profits in the last quarter, it's safe to say that some of their effort is working. > The fact that they also decided that 8K out of the 25K+ employees hired during the pandemic were redundant Kinda odd how you attribute them "beating the street" more to Mathew McConaughey's presence than the work output of 8 thousand employees. Can you elaborate on why this is so clear to you?
  - deleted 4y ago
    [deleted]
  - deltree7 4y ago
    They have better metrics than random anti-corporate HNer who is typically clueless about accounting, marketing, lead-gen?
    - mola 4y ago
      Don't you think that the ppl deciding to hire like crazies just to fire a year later should be accountable for that? They're clearly making bad decisions. It's just that someone else is expected to pay for them.
rayiner 4y ago
Maggie Harrison (who is definitely not Hawaiian) appropriating Hawaiians’ prerogative to define the bounds of acceptable cross-cultural interaction with their group is actual, destructive appropriation. It’s a white person with a platform co-opting a minority group’s ability to decide how it interacts with the majority group.
- tptacek 4y ago
  I agree with you. But: Please don't pick the most provocative thing in an article or post to complain about in the thread. Find something interesting to respond to instead. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html The article isn't really about Hawaiian culture, nor is the complaint it is making about how Salesforce prioritizes its expenditures.
dayyan 4y ago
The real travesty is dropping the fun Island vibe.
robertlagrant 4y ago
This title makes it sound as though the $10M would pay for all those employees. It might pay for 40-50 of them, which is basically a rounding error of 8000. So the question is: can 40-50 people bring more value than one person who can get the attention (for whatever reason) of large customers' CFOs?
time_to_smile 4y ago
Their profits and stock price are both up. Seem like they're making fairly sane financial decisions. I'm not one to defend the actions of corporate leadership most times, but it does look like Salesforce is doing what the market is asking for: bringing up profits. And if we assume an average TC of around 250k per engineer, that's 40 employees of 8,000 laid or half a percent of the employees could have been spared by letting go of McConaughey instead. In case they're mistaken it seems a lot easier to hire 40 $250k engineers again then get McConaughey back after breaking a contract. Meanwhile the company I'm at is just learning that publicly traded companies can't live off runway alone and that they need to become profitable (something they've never done) and please investors. The "leadership"'s failure to act is causing increasing stress in the company, and personally I'm finding it more and more clear they don't really know how to run a public company. There are so many companies that look like what I described I'm not remotely worried about anyone de-anonymizing me over this info. I would much rather be at a company like Salesforce right now. At least there's some evidence the layoffs were effective and anyone surviving, after the recent earnings, is probably already starting to feel more assured about their job. When layoffs do eventually hit me where I'm at now, even if I survive I'm not going to have much confidence in the future.
- lazyasciiart 4y ago
  Nobody at salesforce was worried about their job except for layoffs, and all of us who remain are far more worried about our jobs today than we were on Jan 1. Those layoffs were poorly executed and arbitrarily distributed, and execs will make zero commitments to not continue doing so. Not even a pretense of “if you work hard, you’ll be ok”. Just try and make sure you picked a team and project where you personally look essential to some exec and their personal future at the company.
  - time_to_smile 4y ago
    I appreciate the insight from the other side, and am sorry to hear that the situation remains so stressful there. I guess this situation just universally sucks.
DueDilligence 4y ago
[dead]
ameister14 4y ago
Is Matthew McConaughey worth 40-50 laid off salesforce employees in terms of value provided to Salesforce? No idea. Totally possible, though.
s1artibartfast 4y ago
Weird thinking all around. The point of advertising is to grow sales. You don't have more money to employ people by selling less product.
roody15 4y ago
Reminds me of Domino's talking about supporting local businesses, fixing roads and deploying electrical vehicles. Long story short Domino's spent exponetially more on commercials advertising their "good" deeds than on the deeds themselves. For example spent 54 million on commercials talking about supporting local businesses... provided local businesses 100,000. https://i.redd.it/3vks4w3nddh81.jpg https://i.redd.it/3vks4w3nddh81.jpg Seems like so much in our society is smoke and mirrors these days.
fourseventy 4y ago
Such stupid clickbait. Yes, Salesforce spends millions on advertising. That advertising brings in revenue. Thats how business works.
jdminhbg 4y ago
$10M / 8k = $1250, so I guess they could have kept each of those employees on another day and a half without the McConaughey contract.
filmgirlcw 4y ago
The framing here is off. I understand the impulse, but it's different business decisions and conflating them just isn't reasonable. It is certainly reasonable for employees to question why one area of business was prioritized over others, but framing this as "paying someone $10m to sit around vs 8,000 people who did real work" is still disingenuous. I'm not defending the layoffs -- though I think all of us have known that the ever-increasing TC wars amongst big companies was unsustainable and that tech companies over-hired. And none of that is the people who were laid off's fault. At all. These were bad decisions on the part of management. But framing it as "chose to layoff X people instead of paying out a contract to Matthew McConaughey" is misguided. The bottom line is that Matthew McConaughey did a better job of negotiating his contract than rank and file employees did and that's why he still has a contract. Obviously, he is in a position to argue better terms than rank and file engineers, but that's how this works. If his contract was renewed or reupped on, that would be one thing (and ultimately, that would be something for the board or shareholders to weigh in on), but we don't know the details about how long the contract was for and what the deliverables are, or what the ROI is. Framing this in "this versus that" terms just doesn't make sense.
- ravivooda 4y ago
  > though I think all of us have known that the ever-increasing TC wars amongst big companies was unsustainable Just wow! What about ever increasing stocks? ever increasing returns on VC funds? You've gotta be kidding.
  - ravivooda 4y ago
    Okay, I understand that came across pointing, but I hope you know I'm not pointing at you. I'm pointing at "Market Rate" salary fixing, etc.
    - filmgirlcw 4y ago
      And I don't disagree with that! My point is that the increase we saw went beyond salary fixing. I'm talking seeing TC offers that were more than just stock, and often a cash component, in many cases double for the same job/level at the same company over two years. Where you saw people with no experience hired in at rates significantly higher than high-performers who had worked at a company for a number of years. Do I personally regret not taking some of those insane offers when I had the chance (prioritizing pay over working in a position I know I wouldn't have enjoyed)? Yes, I do. But I also knew in 2021 and even mid-2022 that none of the offers that were going out were sustainable long-term.
WalterBright 4y ago
They should have hired me instead. I'd have done it for $9M.
rhaway84773 4y ago
I don’t get this line of argument. Sales force believed their business will do better with Matthew Mcconaughey as opposed to those 8k employees. They may be wrong, but it’s for them to figure out if they’re wrong. I understand the argument that workers should not be disposable, and workers shouldn’t be fired at will, even with at-will contracts, and companies have responsibilities towards their workers. In fact, that argument is popular enough that most countries, including the U.S. until recently, gave workers and their unions privileges that wouldn’t be afforded in a different scenario. And if you want to argue that workers rights have been diluted far too much in with you. My problem is instead of making this straightforward argument, when you’re trying to compare the firing of workers to spending on a completely different situation. There’s no possible way for an outsider to know what the value of having McConaughey sit around is, what the contractual details are, what the cost, both monetary and otherwise of splitting from him, etc is. My response to this headline isn’t to be more sympathetic to the workers. It’s to wonder what the hell McConaughey getting contractually paid has anything to do with the poor treatment of workers by Salesforce.
- PaulDavisThe1st 4y ago
  > They may be wrong, but it’s for them to figure out if they’re wrong. You clearly buy into the idea that because salesforce has, within our current economic system, managed to gather to itself substantial economic resources, then it should be the entity that gets to decide how to deploy those resources. If Salesforce is wrong (and there's a very, very good chance that they are), they have mis-allocated resources, but will face little if any penalty for it other than some opportunity costs that are of their own making. > There’s no possible way for an outsider to know what the value of having McConaughey sit around is, what the contractual details are, what the cost, both monetary and otherwise of splitting from him, etc is. The actual question is whether there is actually any way for an insider to know this either, and what penalties would be face if they make a mistake. I'm fine with companies making a profit (I think). But I want them taxed in a way that removes their control over the bulk of these resource allocation decisions. Salesforce might (or might not) be very good at what they do, but they, like every other corporation (and essentially all individuals) have no demonstrated competence at resource allocation that benefits all of us. US$10M might not seem like a lot if it is roughly your annual salary, but there are huge numbers of people and communities that would be substantially aided via US$10M.
mmcgaha 4y ago
The tech hiring build up in 2021 and 2022 was all about political appeasement. https://trends.google.com/trends/explore?date=today%205-y&geo=US&q=%22big%20tech%22 https://trends.google.com/trends/explore?date=today%205-y&ge... "Big Tech" could not maintain that forever.
randyrand 4y ago
Alternate title: I don’t understand why businesses have marketing budgets Would at least not be objectively false, unlike the current title. I’m surprised this got upvoted on HN.
oh_sigh 4y ago
8000 people could cost over $1B /yr. That's a totally different scale from paying an A-list celebrity $10M to do some commercials.
stcroixx 4y ago
Gross. If your company uses sales force, try to encourage them to use something else. Don’t recommend it for anything new. Don’t go work for them. Don’t do anything that would be good for salesforce. Do your best to bring them down any way you can.
m3drano 4y ago
You Gotta Pump Those Numbers Up, Those Are Rookie Numbers.
WalterBright 4y ago
After Federal and California taxes, what's it net to McConaughey? $4 million?
frankreyes 4y ago
Assuming an average wage of $50k a year, 8k x $50k is $400m a year. Math checks out

190 points by ppjim 4y ago

This is just a natural reality of capitalism. Some "workers" produce much more value than others. A coder making 150-200k is completely replaceable, a widely recognized public figure is not. Shouldn't be shocking, whats shocking is that people don't understand this and arent honest with themselves about the value they bring to the workplace

nordsieck 4y ago
> whats shocking is that people don't understand this and arent honest with themselves about the value they bring to the workplace The labor theory of value[1] is still a very popular belief. Even though it doesn't work very well if you poke it at all. --- 1. https://en.wikipedia.org/wiki/Labor_theory_of_value https://en.wikipedia.org/wiki/Labor_theory_of_value
satellites 4y ago
Yes, I’m sure an actor adds more real value to a SaaS company than engineers do. Recognizable talking heads who read lines into a camera are famously hard to find.
- adamwong246 4y ago
  given the hype-driven nature of our industry, that may well be the case.
- notmindthegap 4y ago
  "Real value" is an attempt to draw a distinction where there isn't one. Kim Kardashian brings in more "real value" to a clothing company than any one seamstress. Welcome to marketing.
  - anonymouskimmer 4y ago
    And yet a bad seamstress can tank a clothing company if a single bad article of clothing gets into the wrong hands. This kind of makes Kim K a safer play than a bad seamstress. As unless you go full Kanye a spokesmodel isn't going to tank a company.
    - wongarsu 4y ago
      A single bad seamstress causing bad clothing to be delivered to customers is a process failure, the same way no single engineer should be responsible for Saleforce's production systems going down. And in most ways, implementing quality control on your product is a lot easier than controlling the personal life of your spokespeople.
      - anonymouskimmer 4y ago
        Any company that's paying $10M to a spokesperson will have (maybe I should say "should have") a lot of employees dedicated to that spokesperson and the campaign. They might have a clawback clause if the spokesperson shows bad judgement, and can also get some additional good marketing if they are proactive in distancing themselves from their Kanye-esque spokesperson. So I guess, like you say, there is a quality control process regardless. I think the larger issues are probably the decisions of the pre-seamstress process employees. Bad choices in materials or cost-savings measures can turn off customers.
- paxys 4y ago
  If an actor can directly bring more revenue to the business than an engineer then yes, they are adding more real value.
- tekla 4y ago
  Probably does. Most engineers are fungible
amitrip 4y ago
what does a public recognized figure produce?
- ethbr0 4y ago
  Sales.
  - oluwie 4y ago
    Force.
alexfromapex 4y ago
Capitalism creates these situations but what should be talked about is disincentivizing them not that we should accept them. That is enough money for 100 workers to not be laid off for an entire year. Merits a discussion on how much value he’s actually creating. Same goes for CEOs getting paid many millions.
- erulabs 4y ago
  It's not possible to predict if this is a good call or not. At the end of the day, it will come out in the wash, and you can make a pretty penny betting correctly. I'm going to assume no one here thinks this decision is so foolish that it will single handedly bring about the fall of Salesforce. As soon as you stray into the land of "we should make this decision on Salesforce's behalf", you're straying into a "known-unknown", and acting as if it's obvious what the correct decision is is always the downfall of those who seek to plan society according to their morality. If you said "I accept that I don't know if this was a good move for generating profit or not, but I still don't think it should be allowed", I might be more inclined to entertain the idea!
  - alexfromapex 4y ago
    You are having a straw man argument I think. I said it merits a discussion and seems highly unethical. I have to disagree that there are appropriate situations where society should allow unethical situations to occur, unless they are extremely necessary, as that creates an unethical society which is dystopian. My way of phrasing that is that society should highly disincentivize unethical situations.
    - UncleEntity 4y ago
      If it turns out that his being a spokesman provides enough sales to employ 1000 people would that also be unethical? I have no insider knowledge of the inner working of salesforce but I can reasonably surmise that they aren’t paying him to literally sit around.
      - 4y ago
banannaise 4y ago
"That's capitalism, guess y'all gotta suffer while ten people add to their hoards, nothing we can do"
- fdgsdfogijq 4y ago
  I'm not condoning it, just pointing out how society works
  - nickpeterson 4y ago
    I’d also point out that non-capitalist systems don’t actually correct this problem in practice, they just change the means by which wealth is acquired (usually violence).
    - nicoburns 4y ago
      It's ultimately violence in a capitalist society too (what do you think the police are for?). It's certainly possible to achieve a fairer distribution of wealth than capitalist societies produce. And before the inevitable replies: no, I'm not advocating for communism. I'm advocating for non-capitalist variants on market economies.
      - nickpeterson 4y ago
        Sure, all things can be improved, and I know we don’t live in anywhere near a utopia (education, retirement ,healthcare, tort reform, all needed), but I get uncomfortable with the tone that we’re consciously choosing a bad system when the reality is that peacefully refactoring power structures and society is just hard.
      - rootusrootus 4y ago
        > I'm advocating for non-capitalist variants on market economies. I'm struggling to think of a good example of a current non-capitalist market economy. Do you have one in mind? Or are you advocating for something not yet successfully created?
anonymouskimmer 4y ago
I think people understand it, I just think they rightfully don't care that much. They care about their income, not the particular set of justifications the powers-that-be have for their organizational schemes.
jwilber 4y ago
Ah yes, anyone upset that their employer’s layoffs cite financial reasons while objectively wasting money is “shockingly” ignorant to capitalism! Luckily the enlightened fdsg has brought it to our attention! Without knowing what any of them did, it’s obvious that none of them, nor in aggregate, brought any near the value to Salesforce as did one aging celebrity. Anecdotally, I’ve never seen anything associating the actor with Salesforce in any capacity. Even those I know at the company didn’t know he advertised for them. (But capitalism!)
- nickpeterson 4y ago
  I think another lens to view this through, is a company that mismanaged their budget has two more glaring examples of mismanaging their budget.
titzer 4y ago
Ah yes, the smoke-and-mirrors part of capitalism, the style-but-no-substance, image-above-competence, the elitism and cronyism part straight out of Adam Smith.
ben7799 4y ago
I think why this rings false to many is that McConaughey is definitely extremely replaceable. If that is already sunk money and they paid it to him before the layoffs than the article is off base. But why is he at $10M not replaceable by some other celebrity who might do the work for 10x or 100x less? He has no special credibility around anything to do with Salesforce, CRM, or anything in tech. It's more likely Benioff has a man crush on him and like the fact he gets to hang out with a famous movie star and pretend he's friends with him or something and can conveniently ignore that he's kind of buying a famous friend for $10M. A really well executed ad campaign with a less famous, less expensive star might be far more effective.
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gkoberger 4y ago

For what it's worth, this deal was almost definitely signed long before the economy crashed. And he was paid to create / star in ads (I'd assume the money went to his production company, not him specifically), which I don't think is particularly unique... a lot of large billion dollar businesses hire celebrity spokespeople. EDIT: Okay, economy hasn't technically crashed, but valuations are down, funding is down, and layoffs are up. Tech companies have a very different view of money now than they did 8 months ago.

j_walter 4y ago
Exactly this. Financial situtions change but you still haven't to honor contracts that were signed. The 8K employees didn't have the same contracts as a long term spokesperson...that is not unusual at all...
- runesofdoom 4y ago
  "But we had to do <terrible thing> because it's the law" isn't an excuse, just a different form of condemnation.
  - umeshunni 4y ago
    [flagged]
  - flappyeagle 4y ago
    Why is paying a celebrity spokesperson terrible?
    - notmindthegap 4y ago
      Because many of the engineers here either do not understand or are unwilling to accept that society operates in more dimensions than the technical and "rational". They see celebrity and functions like marketing and sales as inherently bullshit and unnecessary.
  - PragmaticPulp 4y ago

notmindthegap 4y ago

Is it so crazy to assume McConaughey may enable more business through his influence than 8,000 employees combined? If true, then it is justified by the argument Benioff put forward and that this article seems to also agree with.

brianwawok 4y ago
People really hate that. Also the secretary is not a fan that their CEO does indeed provide 4000x the value.
- NineStarPoint 4y ago
  CEO is in the unique position of being capable of providing 4000X the value, due to being a force multiplier on the entire company (It’s the job they hold, not skill, that makes it impossible for a random secretary to have as much value to a company). On one hand, this means it is indeed worth paying a lot of money to get the best CEO you can, as small differences in skill have outsized influences on the end result. On the other hand, even the CEOs who are of neutral or negative value compared to someone you could pay 10X less still get paid 4000X more than the secretary. Anyway, long way of saying than general salaries are a race to paying as low an amount as you can to get someone of the needed skill, while CEO salaries are about paying more than strictly necessary due to the effect even a small difference has from your biggest productivity multiplier. And given that most people will never have the opportunity to enter a role where their pay starts being calculated that way, it’s unsurprising they find it unfair (even if it’s logical).
CharlieDigital 4y ago
To put this into perspective, assuming the average salary of the 8k employees is $125,000, that would only save 80 jobs.
- loeg 4y ago
  Keep in mind fully loaded cost is approximately 2x salary. So maybe 40 jobs.

birdyrooster 4y ago

Should change title to Mark Benioff is not Hawaiian because I felt that point most well argued.

vuln 4y ago
I agree. Seems like more words spent on the Hawaiian thing than the actual story.

PragmaticPulp 4y ago

Bad optics, but even if they could break the contract (which presumably includes work/performance already done) and reallocate the funds to save jobs they’d still be laying off about 7,950 people to reach budget parity.

s1artibartfast 4y ago
The purpose of advertising is to bring in Revenue, and presumably Salesforce thinks this ad will bring in more than it cost.
mdasen 4y ago
This was my reaction as well (though it might be closer to 100-200 jobs depending on what kind of jobs were laid off; not all of Salesforce is software engineers). Though I think there is something to be said about companies spending money imprudently. It's never just that they're giving McConaughey $10M/year. Often times there's a slew of vanity expenses that aren't justifiable. I'm not saying that's necessarily the case with Salesforce, but companies spend a lot of money on things that have dubious ROI. For example, GE advertised their smart electric grid technology during the Super Bowl and licensed the Wizard of Oz for it. That's a lot of money for an ad with very dubious ROI. Who is buying smart electric grid technology? A very small handful of companies who are going to have a competitive bidding process and are already going to be aware of their options. What was the point of this commercial? To me, the most likely explanation is executive vanity. They want their friends and peers to be impressed by their company and by extension themselves. If they're working on something invisible and behind the scenes, they aren't going to get the same recognition and acclaim. Companies sponsor sports stadiums and sometimes you can't even really buy their product. Highmark sponsors the Buffalo Bills stadium, but most people get their insurance via their employer and don't have a choice. Xcel Energy sponsors the NHL stadium of the Minnesota Wild and most of their business is as the monopoly electric/natural-gas transmission provider in the area. Are they trying to convince people "you don't want to live off the grid! Life is better with electricity and heating!" And yes, these companies do have some amount of business that is consumer choice, but given how much of their business has zero consumer decision-making, it seems like their ROI on advertising and sponsorships would be terribly low. Consumers do decide on many things - what soda brand to buy, what smartphone to use, what clothes to wear, what car insurance to get, etc. However, we see companies spending lots of money on things that have really dubious justification - beyond the vanity of executives. I don't know much about Salesforce and what they're spending money on, but I do think there's a reasonable question of whether McConaughey's $10M is part of a larger trend of imprudent, potentially vanity-driven spending.

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umeshunni 4y ago

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paxys 4y ago

"Company" = Salesforce, which is a name I'm sure people over here recognize, so we can swap it out in the title. There's also little value in pushing this clickbait style journalism to the front page. First of all, it is objectively incorrect: > Per the WSJ, the company will be letting go of 8,000 members from its massive workforce The layoffs they are referring to happened in early January. They are not laying off another 8000 employees. Beyond that, they paid an A-list actor $10M out of their marketing budget not to "sit around" but to do a set of commercials (one of which aired at the Superbowl). Considering they exceeded all analyst expectations for revenue and profits in the last quarter, it's safe to say that some of their effort is working. Enlightened engineers don't like to admit it, but advertising works, and is a critical part of running any business. The fact that they also decided that 8K out of the 25K+ employees hired during the pandemic were redundant has nothing to do with Matthew McConaughey.

eunoia 4y ago
> Considering they exceeded all analyst expectations for revenue and profits in the last quarter, it's safe to say that some of their effort is working. > The fact that they also decided that 8K out of the 25K+ employees hired during the pandemic were redundant Kinda odd how you attribute them "beating the street" more to Mathew McConaughey's presence than the work output of 8 thousand employees. Can you elaborate on why this is so clear to you?
- deleted 4y ago
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- deltree7 4y ago
  They have better metrics than random anti-corporate HNer who is typically clueless about accounting, marketing, lead-gen?
  - mola 4y ago
    Don't you think that the ppl deciding to hire like crazies just to fire a year later should be accountable for that? They're clearly making bad decisions. It's just that someone else is expected to pay for them.

rayiner 4y ago

Maggie Harrison (who is definitely not Hawaiian) appropriating Hawaiians’ prerogative to define the bounds of acceptable cross-cultural interaction with their group is actual, destructive appropriation. It’s a white person with a platform co-opting a minority group’s ability to decide how it interacts with the majority group.

tptacek 4y ago
I agree with you. But: Please don't pick the most provocative thing in an article or post to complain about in the thread. Find something interesting to respond to instead. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html The article isn't really about Hawaiian culture, nor is the complaint it is making about how Salesforce prioritizes its expenditures.

dayyan 4y ago

The real travesty is dropping the fun Island vibe.

robertlagrant 4y ago

This title makes it sound as though the $10M would pay for all those employees. It might pay for 40-50 of them, which is basically a rounding error of 8000. So the question is: can 40-50 people bring more value than one person who can get the attention (for whatever reason) of large customers' CFOs?

time_to_smile 4y ago

Their profits and stock price are both up. Seem like they're making fairly sane financial decisions. I'm not one to defend the actions of corporate leadership most times, but it does look like Salesforce is doing what the market is asking for: bringing up profits. And if we assume an average TC of around 250k per engineer, that's 40 employees of 8,000 laid or half a percent of the employees could have been spared by letting go of McConaughey instead. In case they're mistaken it seems a lot easier to hire 40 $250k engineers again then get McConaughey back after breaking a contract. Meanwhile the company I'm at is just learning that publicly traded companies can't live off runway alone and that they need to become profitable (something they've never done) and please investors. The "leadership"'s failure to act is causing increasing stress in the company, and personally I'm finding it more and more clear they don't really know how to run a public company. There are so many companies that look like what I described I'm not remotely worried about anyone de-anonymizing me over this info. I would much rather be at a company like Salesforce right now. At least there's some evidence the layoffs were effective and anyone surviving, after the recent earnings, is probably already starting to feel more assured about their job. When layoffs do eventually hit me where I'm at now, even if I survive I'm not going to have much confidence in the future.

lazyasciiart 4y ago
Nobody at salesforce was worried about their job except for layoffs, and all of us who remain are far more worried about our jobs today than we were on Jan 1. Those layoffs were poorly executed and arbitrarily distributed, and execs will make zero commitments to not continue doing so. Not even a pretense of “if you work hard, you’ll be ok”. Just try and make sure you picked a team and project where you personally look essential to some exec and their personal future at the company.
- time_to_smile 4y ago
  I appreciate the insight from the other side, and am sorry to hear that the situation remains so stressful there. I guess this situation just universally sucks.

DueDilligence 4y ago

[dead]

ameister14 4y ago

Is Matthew McConaughey worth 40-50 laid off salesforce employees in terms of value provided to Salesforce? No idea. Totally possible, though.

s1artibartfast 4y ago

Weird thinking all around. The point of advertising is to grow sales. You don't have more money to employ people by selling less product.

roody15 4y ago

Reminds me of Domino's talking about supporting local businesses, fixing roads and deploying electrical vehicles. Long story short Domino's spent exponetially more on commercials advertising their "good" deeds than on the deeds themselves. For example spent 54 million on commercials talking about supporting local businesses... provided local businesses 100,000. https://i.redd.it/3vks4w3nddh81.jpg https://i.redd.it/3vks4w3nddh81.jpg Seems like so much in our society is smoke and mirrors these days.

fourseventy 4y ago

Such stupid clickbait. Yes, Salesforce spends millions on advertising. That advertising brings in revenue. Thats how business works.

jdminhbg 4y ago

$10M / 8k = $1250, so I guess they could have kept each of those employees on another day and a half without the McConaughey contract.

filmgirlcw 4y ago

The framing here is off. I understand the impulse, but it's different business decisions and conflating them just isn't reasonable. It is certainly reasonable for employees to question why one area of business was prioritized over others, but framing this as "paying someone $10m to sit around vs 8,000 people who did real work" is still disingenuous. I'm not defending the layoffs -- though I think all of us have known that the ever-increasing TC wars amongst big companies was unsustainable and that tech companies over-hired. And none of that is the people who were laid off's fault. At all. These were bad decisions on the part of management. But framing it as "chose to layoff X people instead of paying out a contract to Matthew McConaughey" is misguided. The bottom line is that Matthew McConaughey did a better job of negotiating his contract than rank and file employees did and that's why he still has a contract. Obviously, he is in a position to argue better terms than rank and file engineers, but that's how this works. If his contract was renewed or reupped on, that would be one thing (and ultimately, that would be something for the board or shareholders to weigh in on), but we don't know the details about how long the contract was for and what the deliverables are, or what the ROI is. Framing this in "this versus that" terms just doesn't make sense.

ravivooda 4y ago
> though I think all of us have known that the ever-increasing TC wars amongst big companies was unsustainable Just wow! What about ever increasing stocks? ever increasing returns on VC funds? You've gotta be kidding.
- ravivooda 4y ago
  Okay, I understand that came across pointing, but I hope you know I'm not pointing at you. I'm pointing at "Market Rate" salary fixing, etc.
  - filmgirlcw 4y ago
    And I don't disagree with that! My point is that the increase we saw went beyond salary fixing. I'm talking seeing TC offers that were more than just stock, and often a cash component, in many cases double for the same job/level at the same company over two years. Where you saw people with no experience hired in at rates significantly higher than high-performers who had worked at a company for a number of years. Do I personally regret not taking some of those insane offers when I had the chance (prioritizing pay over working in a position I know I wouldn't have enjoyed)? Yes, I do. But I also knew in 2021 and even mid-2022 that none of the offers that were going out were sustainable long-term.

WalterBright 4y ago

They should have hired me instead. I'd have done it for $9M.

rhaway84773 4y ago

I don’t get this line of argument. Sales force believed their business will do better with Matthew Mcconaughey as opposed to those 8k employees. They may be wrong, but it’s for them to figure out if they’re wrong. I understand the argument that workers should not be disposable, and workers shouldn’t be fired at will, even with at-will contracts, and companies have responsibilities towards their workers. In fact, that argument is popular enough that most countries, including the U.S. until recently, gave workers and their unions privileges that wouldn’t be afforded in a different scenario. And if you want to argue that workers rights have been diluted far too much in with you. My problem is instead of making this straightforward argument, when you’re trying to compare the firing of workers to spending on a completely different situation. There’s no possible way for an outsider to know what the value of having McConaughey sit around is, what the contractual details are, what the cost, both monetary and otherwise of splitting from him, etc is. My response to this headline isn’t to be more sympathetic to the workers. It’s to wonder what the hell McConaughey getting contractually paid has anything to do with the poor treatment of workers by Salesforce.

PaulDavisThe1st 4y ago
> They may be wrong, but it’s for them to figure out if they’re wrong. You clearly buy into the idea that because salesforce has, within our current economic system, managed to gather to itself substantial economic resources, then it should be the entity that gets to decide how to deploy those resources. If Salesforce is wrong (and there's a very, very good chance that they are), they have mis-allocated resources, but will face little if any penalty for it other than some opportunity costs that are of their own making. > There’s no possible way for an outsider to know what the value of having McConaughey sit around is, what the contractual details are, what the cost, both monetary and otherwise of splitting from him, etc is. The actual question is whether there is actually any way for an insider to know this either, and what penalties would be face if they make a mistake. I'm fine with companies making a profit (I think). But I want them taxed in a way that removes their control over the bulk of these resource allocation decisions. Salesforce might (or might not) be very good at what they do, but they, like every other corporation (and essentially all individuals) have no demonstrated competence at resource allocation that benefits all of us. US$10M might not seem like a lot if it is roughly your annual salary, but there are huge numbers of people and communities that would be substantially aided via US$10M.

mmcgaha 4y ago

The tech hiring build up in 2021 and 2022 was all about political appeasement. https://trends.google.com/trends/explore?date=today%205-y&geo=US&q=%22big%20tech%22 https://trends.google.com/trends/explore?date=today%205-y&ge... "Big Tech" could not maintain that forever.

randyrand 4y ago

Alternate title: I don’t understand why businesses have marketing budgets Would at least not be objectively false, unlike the current title. I’m surprised this got upvoted on HN.

oh_sigh 4y ago

8000 people could cost over $1B /yr. That's a totally different scale from paying an A-list celebrity $10M to do some commercials.

stcroixx 4y ago

Gross. If your company uses sales force, try to encourage them to use something else. Don’t recommend it for anything new. Don’t go work for them. Don’t do anything that would be good for salesforce. Do your best to bring them down any way you can.

m3drano 4y ago

You Gotta Pump Those Numbers Up, Those Are Rookie Numbers.

WalterBright 4y ago

After Federal and California taxes, what's it net to McConaughey? $4 million?

frankreyes 4y ago

Assuming an average wage of $50k a year, 8k x $50k is $400m a year. Math checks out