Shopify's corporate news site with announcements on layoffs, compensation, acquisitions, logistics, and its climate and carbon removal spending.
HN links it for company announcements. Commenters cite it on layoffs, pay changes, the logistics sale to Flexport, and Shopify's direct air capture purchases.
That's not exactly what they bet, because anyone knows that it would be dumb, including them.
What you have to look at is e-commerce adoption as a % of retail. This % is increasing every year since the end of the 90s. It was about 10% pre-pandemic.
Of course they knew that the huge jump from COVID wouldn't be permanent. What they bet however is that once things re-open, SOME of that conversion to e-commerce would be permanent and that trend of % of retail on ecom would keep increasing at a faster pace than if COVID had not happened. Which wasn't the worse bet to take, you'd think that if people get used to a certain way of shopping and we invest in all this ecom infrastructure, some people would prefer the convenience of it in the long term.
Tobi explained it well in his announcement for layoffs last year at Shopify (which came much earlier than other tech companies, likely because their revenue is much more strongly related to ecom revenue)
https://news.shopify.com/changes-to-shopifys-team
It's going to be an interest year or two if all tech stocks continue to fall. Most of these companies pay largely in RSUs for more senior ICs and managers. RSUs strike a price at the grant date. If you're paid 50% in stock, and the stock falls by 24%, you just took a 12% pay cut.
Meanwhile, the new guy doing the same job as you got their RSUs granted at today's stock price, but the target value for someone at that job level- no pay cut for them, effectively.
It's a recipe for a lot of people swapping jobs just to keep their incomes at the same level.
Or, companies can do as my employer did (bias note) and switch to a new comp system that avoids these problems: https://news.shopify.com/rewriting-the-story-of-compensation
Depends on the company but yes.
Stripe, as an example, drastically slowed down hiring when the pandemic hit expecting an economic slowdown. It then turned out that so much commerce moved to online—rather than stopped—so they ramped up hiring to meet demand.
The bet that companies like Shopify and Stripe [1] made was that COVID created a “new normal”; much of the economic activity that went online would stay there. They were wrong, so there were layoffs to correct it.
[0]: https://news.shopify.com/changes-to-shopifys-team
[1]: https://stripe.com/newsroom/news/ceo-patrick-collisons-email-to-stripe-employees
Shopify announced staff layoffs in July 2022. The Shopify CEO expressed the same sentiment repeated later by Stripe and Facebook:
"...given what we saw, we placed another bet: We bet that the channel mix - the share of dollars that travel through ecommerce rather than physical retail - would permanently leap ahead by 5 or even 10 years."
"It’s now clear that bet didn’t pay off. What we see now is the mix reverting to roughly where pre-Covid data would have suggested it should be at this point."
https://news.shopify.com/changes-to-shopifys-team
Note that the complete, non-truncated quote [1] says:
"Ultimately, placing this bet was my call to make and I got this wrong. Now, we have to adjust. As a consequence, we have to say goodbye to some of you today and I’m deeply sorry for that."
Emphasis added, but perhaps some part of this apparent tone-deafness might be attributed to the omission?
[1] https://news.shopify.com/changes-to-shopifys-team
Shopify will quite literally remove the carbon from the air via the Direct Air Capture plants that they've purchased [1]. They're not saying "hey buy from us and we won't knock down a tree," they're literally pulling carbon from the air via DACs.
It's as simple as that.
[1] https://news.shopify.com/shopify-purchases-more-direct-air-capture-dac-carbon-removal-than-any-other-company