February 15, 2023
The last few months have been tough for a lot of people - young, old, it doesn't much matter. Layoffs, down rounds, and bankruptcies jolt the seemingly inexorable progression of life. Decisions that were within grasp are now no longer. Starting a family or retirement are eclipsed by job applications and culture fit interviews.
Yet among people I know, they've never been more excited. A lot of people are still starting companies, raising funding, and exploring new fields. In some cases the layoffs have been an excuse to seek change. If they can't attain stability at a big company why not start their own thing?1
We're seeing one of the largest reallocations of labor in our lifetimes. Most of those affected by these large-scale layoffs are not going into unemployment. They're going to different companies or other career paths to try something new. After the monotony of the pandemic, stable growth is being replaced by risk taking.
Big technology companies have their advantages. They have brilliant people, sophisticated architecture stacks, and huge distribution channels. But they also are necessarily swimming in bureaucracy. You can't employ the headcount of a country and not have robust process. But that process makes it significantly harder to go 0-1 on groundbreaking things. I'm convinced that the biggest impacts come from smaller groups and the modern Valley is anything but small groups.
There seems to be a silver lining in all this churn. Most people I've talked with are happier now than they were before. The last two years forced them to reconsider where they want to be investing their time.
I'm reminded of this quote from Interstellar (subpar movie, some good dialogue):
Right now the world doesn't need more engineers. We didn't run out of planes, or television sets. We ran out of food. The world needs farmers.
We certainly need more farmers, more builders, and more nurses. But I also think we can use more engineers. Engineers can build amazing things. But some of the brightest people end up optimizing 0.01% conversion rates - decreasing their own drive and passion for engineering along the way.
Startups often fail and certainly pay less than bigger companies.2 But the work is fun - at least, fun in a relative sense. You're given far more autonomy, far earlier than an established company. You can experiment, learn, and move the product forward. Anecdotally, friends that have jumped ship from a FAANG company to a startup are much happier. They feel like they're moving at a run instead of a walk.
Instead of taking corporate churn as a setback - a lot of them are excited for the future. I'm really excited to see what they do next.
This perspective seems to be extreme in both ways. Some people seize the newfound risk and jump to riskier endeavors. Others need stability after chaos and look for low risk company profiles during their next interview round. ↢
I explicitly think financial gains shouldn't be a goal of joining a startup. Financial outcomes are a goal of starting a company yourself, but the combination of failure rate and overall equity grant size are such that few people get rich on being an early employee. Joining a startup is mostly valuable for other reasons. ↢