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> The company counted an average of only 42 employees in 2023, down from 61 two years earlier. During the year, it generated $31MM in net revenue per employee (
by paxys 2y ago
> The company counted an average of only 42 employees in 2023, down from 61 two years earlier. During the year, it generated $31MM in net revenue per employee (13-28x that of Amazon, Apple, Google, and Microsoft) and $15.5MM in operating profit (27-560x).
This is the wildest part. One company that is proving all the "why does <company> need 10000 engineers?" takes true.
- rldjbpin 2y agosurvival bias for platform services. funnily enough out of the 42 employees still there, i assume less than a fourth are actually engineers.
- PUSH_AX 2y agoIt's easy to say this without knowing what is suffering as a result.
- paxys 2y agoWhat is suffering as a result?
- cruffle_duffle 2y agoThe all important 99.99% uptime with a P99.9 request latency of 10ms globally? As you know, porn sites have a strict SLA that not even AWS has to meet. …but as others pointed out there I’m sure there is an army of contractors that don’t factor into any headcount figure. Which doesn’t at all subtract from the insane revenue per employee figure.
- blackhawkC17 2y agoThey employ hundreds of contractors to run the operations.
- preciousoo 2y agoIt could be compliance/moderation efforts, this is not specified
- jandrese 2y agoIf that's true then the statement is basically an accounting lie.
- naijaboiler 2y agoIt is
- almatabata 2y agoIt does not. These companies do not even work in the same problem space. Amazon works in retail, cloud, book publishing, etc. Microsoft maintains their own cloud as well and a complete operating system. At least compare it to companies with similar businesses. I would argue twitch seems closer. I think they had over 1000 employees. You would have a better point with that comparison if you would want to make that argument.
- ghaff 2y agoI'm going to say more or less the same thing in a different way. As you scale up to do more and different things, your efficiency at some level is going to go down. Maybe way down.
- xyst 2y agoOF revolves around a single product AWS/GCP/Azure manage physical data centers across the globe, and includes hundreds of services/offerings on each platform. Additionally, critical industries (hospitals, banks, airlines) often rely on these companies to be available/resilient at all times. Thus the need for increased global workforce. OF on the other hand, nobody is going to die if they can’t access the feet pics they bought for a few minutes or days. You are not comparing the same companies.
- strken 2y ago> This is the wildest part. One company that is proving all the "why does <company> need 10000 engineers?" takes true. Generally speaking, <company> needs <number> engineers because it's rational to keep hiring while each incremental engineer generates more value than they cost in salary and overhead, even if some of those engineers are at less than 50% utilisation and have to generate pointless make-work for themselves to get past performance review.
- kragen 2y agothat sounds like a path to an unsustainable situation where your company is run by socially adept fratboys and charismatic politicians instead of hackers, with company leadership insulated from actual facts on the ground by many layers of middle managers with strong incentives to lie? even if those incremental engineers are generating more value at first, they won't be able to continue doing so when most of the company exists to defend their pointless make-work. the people who leave first won't be the ones spending their time on pointless make-work
- 2y ago
- michaelt 2y agoRevenue per employee isn't a useful metric here IMHO. If Company A sells $100M of televisions which they imported for $95M they've made $5M in profit. If Company B sells $100M of search ads which they served for $1M they've made $99M in profit. From a revenue perspective they're equal - but $1M invested in Company A produces a 5% return on investment, while the same $1M invested in Company B has a 9900% ROI.
- finnh 2y agoThe quoted section is about net revenue, which in this article means total revenue minus the payouts to creators. In other worse, revenue minus COGS. It's a valid comparison.
- michaelt 2y agoAh, you're right. I confused the quoted section with the second paragraph and first two charts of the article, which are throwing around billions and comparing to the NBA based on gross revenue.
- makeitdouble 2y agoMy gut feeling is this number doesn't match our assumptions. For instance moderation and community management alone must be a huge pool of people. While the content and comments can be adult, they'll need to deal with all the payment related back and forth, including chargebacks, legal inquiries etc. Same for doxxing, underage filtering, spam and so on. I assume most if not all of it is a different company which isn't counted in the 42 employees. Of course engineering can be treated the same, with sub-contracting companies dealing with the actual running of the service or part of the developement.
- QuercusMax 2y ago...and of course, the actual content isn't being created by employees.
- philipwhiuk 2y agoModeration and CM will be contractors.
- naijaboiler 2y agoThe articles say they have 100s of contractors all over. My guess is they are not reporting their true “headcount” by claiming those are not employees
- jandrese 2y agoWhere labor costs really start to skyrocket is when you start trying to moderate content and keep the porn bots from invading your site. OF probably spends little in doing this. It is remarkable that they've been able to keep their payment processors happy despite the distinct possibility that a number of the performers are underage and a huge legal liability. Clearly with a staff that small they aren't doing the most extensive background checks.
- AzzyHN 2y agoOF makes one product, and that product is maintaining a particular platform, that's why they don't need tons of engineers. They've just got to be a more attractive platform than their competition, and the money keeps coming in.
- RevEng 2y agoThey mention having hundreds of contractors. Just because workers aren't full time employees doesn't mean they don't work for the company. Construction and sales are often done by "independent contractors". This reduces the requirements for the employers, working around many labor laws like overtime and paid leave. Google is known for doing this a lot.
- LastTrain 2y agoWe can’t all be purveyors of a TnA