Following up on my tech slowdown post from last week, Twitter is indeed laying off over 300 people, or 8% of their staff:

“Product and Engineering are going to make the most significant structural changes to reflect our plan ahead,” CEO Jack Dorsey said in a letter Tuesday morning. “We feel strongly that Engineering will move much faster with a smaller and nimbler team, while remaining the biggest percentage of our workforce. And the rest of the organization will be streamlined in parallel.”

MakerBot is laying off 20% of their staff:

MakerBot is laying off 20 percent of its staff for the second time in the last six months, citing “market dynamics” and a failure to meet “ambitious goals.” The company is also leaving one of the two buildings it occupies in Industry City, a large-scale manufacturing complex in Brooklyn.

Layoffs like this remind me of traffic bottlenecks on the highway when there are no accidents: they’re the result of us stupid humans getting too greedy and not pacing ourselves.

I have side with HAL on this.

The problems can only be attributable to human error.

I’m not sure if this is going to affect more companies, but there appears to be some deflation going on in the tech world.

The Gilt Groupe is cutting 45 jobs ‘Amid A Quest For Profit‘. Money, money, need more money. Money. Then Evernote lays off 47 people and closes 3 offices in effort to build a more focused team. That damn focus! We lost it with all these extra people around! Who the fuck hired them, anyway?! GroupOn is cutting 1,100 jobs worldwide as part of a restructuring of its international operations. They had structure and now they’re restructuring it. Again, humans getting in the way.

Re/code also notes investor slowdown in 2015:

New data from Thomson Reuters and the National Venture Capital Association’s Fundraising Report show that VC firms raised $4.4 billion in the third quarter of 2015. That’s a 59 percent decrease from the second quarter and a 33 percent decrease from the third quarter of last year.

People in the world. Doing stuff with money.

Update: Twitter Is Planning Company-Wide Layoffs for Next Week

Horace Dediu on the potential to disrupt the automotive industry:

Executives at car companies have suddenly had to answer questions about potential entrants into their business. This is a big change. I don’t recall a time when this was necessary for over 30 years. For decades the questions have been about labor relations, health care costs, regulation, recalls and competition from other car makers. To ask questions about facing challengers posing existential questions must seem terribly impertinent.

For this reason, Bob Lutz, in his dismissal of Apple’s entry is not alone. The industry, with a century of history and has seen little disruption in the classic sense. I wrote a long piece on the fundamentals of the industry titled “The Entrant’s Guide to the Automobile Industry” which explained why this industry has been so resistant to disruptive change. At best a massive effort over multiple decades usually leads in a small shift in market share.

However, one should read that post as a thinly veiled threat. Just because disruption seems hard does not mean it isn’t possible. Indeed, the better you understand the industry the more easily you can observe its vulnerability and the more rigid the industry seems the more vulnerable it may be to dramatic change.

The formula for successful entry is the same for all industries: compete asymmetrically. This means introduce products which change the basis of competition and deter competitive responses by making your goals dissimilar from those of the incumbents. This is classic “ju-jitsu” of disruptive competition.

Here’s how it would work.

Apple has succeeded in disrupting:

• the music industry
• the (smart)phone industry
• the PC (and post-PC) industry

And while the Apple Watch is still very young they’re beginning to chip away at the watch industry.

Why would anyone think it’s not possible they eat up the automotive industry too?

Apple’s success in any new industry is far from guaranteed but to count them out seems extremely short-sighted.

News today from Kickstarter:

Benefit Corporations are for-profit companies that are obligated to consider the impact of their decisions on society, not only shareholders. Radically, positive impact on society becomes part of a Benefit Corporation’s legally defined goals. When a company becomes a Benefit Corporation, it can choose to make further commitments. In our new charter (shown below) we spell out our mission, our values, and the commitments we have made to pursue them.

Pretty cool.

Wow, Amazon sounds like a great place to work:

Company veterans often say the genius of Amazon is the way it drives them to drive themselves. “If you’re a good Amazonian, you become an Amabot,” said one employee, using a term that means you have become at one with the system.

And:

Some veterans interviewed said they were protected from pressures by nurturing bosses or worked in relatively slow divisions. But many others said the culture stoked their willingness to erode work-life boundaries, castigate themselves for shortcomings (being “vocally self-critical” is included in the description of the leadership principles) and try to impress a company that can often feel like an insatiable taskmaster. Even many Amazonians who have worked on Wall Street and at start-ups say the workloads at the new South Lake Union campus can be extreme: marathon conference calls on Easter Sunday and Thanksgiving, criticism from bosses for spotty Internet access on vacation, and hours spent working at home most nights or weekends.

“One time I didn’t sleep for four days straight,” said Dina Vaccari, who joined in 2008 to sell Amazon gift cards to other companies and once used her own money, without asking for approval, to pay a freelancer in India to enter data so she could get more done. “These businesses were my babies, and I did whatever I could to make them successful.”

Since the article came out, CEO Jeff Bezos has refuted many of the claims in the article.

via Re/Code

The Telegraph, reporting on the reaction of indie UK record labels on Apple Music’s terms:

Apple is accused of attempting to launch its new Spotify rival, Apple Music, in a way that would leave Britain’s independent record labels “completely screwed” and struggling to survive.

The Silicon Valley giant is demanding that record labels such as XL Recordings, the home of Adele, and Domino, the label behind the Arctic Monkeys, agree to a free three-month trial of Apple Music, during which they will receive no payment.

The plan, only disclosed since the service was unveiled in at a glitzy event in San Francisco last week, has caused dismay among British labels, according to Andy Heath, the chairman of UK Music, the industry lobby group.

Doesn’t seem fair to me. Three months is a long time to not get paid and time is money.

NYTimes: New Research Says Robots Are Unlikely to Eat Our Jobs:

The McKinsey study analyzes and forecasts the potential impact of so-called digital talent platforms. The report looks at three types of such platforms: job-finding and employee-seeking websites (such as Monster.com and LinkedIn); marketplaces for services (Uber and Upwork, for example); and data-driven talent discovery tools (like Evolv and Knack).

By 2025, McKinsey estimates, these digital talent platforms could add $2.7 trillion a year to global gross domestic product, which would be the equivalent of adding another Britain to the world economy. And the digital tools, the report states, could benefit as many as 540 million people in various ways, including better matches of their skills with jobs, higher wages and shorter stints of unemployment.

Bull-fucking-shit.

I was going to say ‘read between the lines’, but you don’t even need to.

This article is highlighting the macro-economic benefits to companies, not how much people are likely to make (or not make).

I’d like to invite any of the heads of these companies to see how much they can make on these marketplace and talent discovery websites where it’s usually a race to the bottom. Who can do my job the cheapest? Any takers?!

In crowdfunding news, states are being proactive on crowdfunding regulations:

In 2012, President Obama signed a law that he called a “potential game changer” for entrepreneurs seeking financing to start or expand a business: Small companies looking for financial backers could advertise their offerings online, and average people — not just wealthy accredited investors — would be allowed to buy stakes in businesses they found promising.

More than three years later, entrepreneurs are still waiting for federal regulators to finish drafting the long-overdue rules that would let that part of the law take effect. Now, state agencies and lawmakers, tired of waiting, are taking action, passing crowdfunding laws and regulations to let local businesses raise money from local residents.

Interesting, but “average” people need to understand the risks in whatever ideas they’re investing in.

Despite a $20 million Kickstarter campaign, Pebble is in trouble?

The company, which recently raised $20 million in a wildly successful Kickstarter, currently has 150 employees and is still hiring. Even with the crowdfunding infusion – which amounts to about $18 million after fees – the company is shopping for VC money in order to maintain growth and turned to a bank loan “in order to stay afloat.”

These start-ups that need continual injections of money sound more like junkies than legitimate companies.

“I promise man, this is the last time I’m going to ask you for money… I’m cool, I’m cool. Vegas cleaned me out, but I’m a new man now.”

Now, Google is set to launch perhaps its most critical commerce-related experiment ever: “Buy” buttons on mobile ads, according to multiple sources, which will turn Google into a cross between a search engine and Amazon. (The Wall Street Journal first reported the move.) It’s the latest attempt by Google to remake its search business for a world increasingly spent on mobile devices and dominated by apps like Facebook, Twitter, Instagram and Amazon — none of which Google owns.

—Jason Del Rey, Re/code

The always-hungry Google tries to consume more of the Internet.

At Re/Code, Arik Hesseldahl explains how venture capitalists cover their asses and cash:

It turns out that for companies of a certain size, it’s not that hard to get to unicorn status, provided they’re willing to give their investors a lot of assurances that essentially cover their potential losses. The one thing common to every one of these funding deals, the firm says, is that in every case — all 37 of them — investors demanded a “liquidation preference.”

The phrase refers to language often found in an investment contract — and typical to most VC investments — that gives certain investors the right to get paid first ahead of other parties — such as founders or management — in the event the company is sold. If the company sells for a price that is lower than the valuation the investor paid, that investor is the first one in line to receive the proceeds of the sale until they’re made whole. And if the company sells for a higher price, they’re first in line to reap a share of the profit.

What that ultimately means is the investors are taking on very little risk when investing in unicorns, because they stand almost no risk of losing their money if the company goes south.

It’s a win-win world for VC firms.

Secret raised a total of $35 million dollars, but they’re shutting down.

The question isn’t whether we needed an app that let you anonymously post short messages, but whether said app is worth one-hundred-million-fucking-dollars.

At Re/code, Ina Fried on Microsoft’s Build Conference this week:

When Microsoft CEO Satya Nadella takes the stage on Wednesday at Microsoft Build, the most important event of the year for the once mighty software maker, it represents something of a last best chance to win over mobile developers.

For all its power in the PC era, Microsoft has struggled to convince developers to create apps for its Windows Phone system, which has badly lagged rivals Google and Apple. Failing to win support at its annual developers conference this week could be fatal to its phone business.

I don’t see this week’s Build Conference shifting the tide for Microsoft.

They’re hovering at under 4% marketshare in the mobile OS space.

As I wrote back in 2011, a big part of Microsoft’s problem is that they’re in a red ocean, from Wikipedia:

Red Oceans are all the industries in existence today–the known market space. In the red oceans, industry boundaries are defined and accepted, and the competitive rules of the game are known. Here companies try to outperform their rivals to grab a greater share of product or service demand. As the market space gets crowded, prospects for profits and growth are reduced.

My wife just picked up a cheap Windows Phone as her secondary phone for her jewelry business (it was only $29!) and I have to say, Windows Phone is a great feeling operating system, but it’s just not enough.