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> Elon dumped 80% of Twitter staff and it didn't collapse. That was because Twitter was massively overstaffed. Are all these other businesses also overstaffed?

> Elon dumped 80% of Twitter staff and it didn't collapse. That was because Twitter was massively overstaffed. Are all these other businesses also overstaffed? The result of cheap money? Are they all atu

bentt 1y ago
They are all overstaffed because they were financially incentivized to overstaff, both for valuation and defensive talent hoarding reasons. This was a positive feedback loop which unwound in tech and will unwind in AI too.
- c16 1y ago
  Definitely feels like since AI there's been a shift and it's gone from total head count as a measure of success to revenue per employee as a measure of success. The fewer employees the better.
  - bentt 1y ago
    Probably because they need to burn all their investment money on compute.
  - surgical_fire 1y ago
    > The fewer employees the better. This has always been true for any mature companies. The conundrum is that tech companies in particular are really averse to be perceived as mature companies, because their valuations have to be more grounded in reality.
FirmwareBurner 1y ago
>That was because Twitter was massively overstaffed. What's the proof it was the only tech company being overstaffed? For example Meta doubled its headcount during the pandemic without any increase in market share or new products. How do you explain that not being overstaffed?
- graemep 1y ago
  I think it very likely a lot of big tech companies are overstaffed. However a lot of companies in many industries are cutting back.
  - FirmwareBurner 1y ago
    That's what I said.
- xnx 1y ago
  > For example Meta doubled its headcount during the pandemic without any increase in market share or new products. Meta probably overhired, but if the overall market grows immensely due to even more commerce moving online because of the pandemic, it would make sense to hire a lot more people even without a change in market share or new products.
moomin 1y ago
The thing is, you need those staff to implement expansion plans. Twitter, famously, didn’t make the kind of money people expected a site with that many loyal users to make. Give up on your ambitions and you can lose people. Meta did the same thing.

bentt 1y ago

They are all overstaffed because they were financially incentivized to overstaff, both for valuation and defensive talent hoarding reasons. This was a positive feedback loop which unwound in tech and will unwind in AI too.

c16 1y ago
Definitely feels like since AI there's been a shift and it's gone from total head count as a measure of success to revenue per employee as a measure of success. The fewer employees the better.
- bentt 1y ago
  Probably because they need to burn all their investment money on compute.
- surgical_fire 1y ago
  > The fewer employees the better. This has always been true for any mature companies. The conundrum is that tech companies in particular are really averse to be perceived as mature companies, because their valuations have to be more grounded in reality.

FirmwareBurner 1y ago

>That was because Twitter was massively overstaffed. What's the proof it was the only tech company being overstaffed? For example Meta doubled its headcount during the pandemic without any increase in market share or new products. How do you explain that not being overstaffed?

graemep 1y ago
I think it very likely a lot of big tech companies are overstaffed. However a lot of companies in many industries are cutting back.
- FirmwareBurner 1y ago
  That's what I said.
xnx 1y ago
> For example Meta doubled its headcount during the pandemic without any increase in market share or new products. Meta probably overhired, but if the overall market grows immensely due to even more commerce moving online because of the pandemic, it would make sense to hire a lot more people even without a change in market share or new products.

moomin 1y ago

The thing is, you need those staff to implement expansion plans. Twitter, famously, didn’t make the kind of money people expected a site with that many loyal users to make. Give up on your ambitions and you can lose people. Meta did the same thing.