Turbulence in Tech
On the Current Economic Chaos
Note: today’s article is intentionally brief and aimed at providing some support to folks who may have had a particularly awful week.
Do not pray for easy lives, pray to be stronger men.
-John F. Kennedy
It has been a painful week, indeed, for those of us working in the technology sector. Workforce reductions left and right, public valuations continue to endure violence, and the rest of us left with a sense of fear and helplessness.
According to Layoffs.fyi, technology companies had ~103,906 employees laid off in 20221. That’s a lot.
For those of us in technology or corporate America we may see a number like this and be fooled into thinking it’s reflective of the broader economy—it’s not.
In September 2022, there were roughly 159 million employed people in the US.
The unemployment rate for the month of October, announced this past week, was estimated to be 3.7% which was a 0.2% point increase. This is what the Federal Reserve is aiming for but with increases in wage growth it‘s not enough cooling.
The Federal Reserve raised interest rates by another historic amount and signaled it would likely continue raising rates higher than previously expected, which means there is further pain to come.
Which leaves one major question: what should you do?
Maximum Effort
Now is not the time to panic, be afraid, or be frozen with anxiety.
Now is the time to build like you’ve never built before.
The only thing we can do to weather the storm ahead is focus on our customers and provide them with enough value that they choose us as their budgets tighten.
I previously wrote that challenging times are on the horizon but companies, careers, and fortunes are made during hard times. Building businesses and innovating when times are good is great but thriving during hardship is what separates great from legendary.
Now is the time to be bold while others are fearful, whether that is capitalizing on an incredible talent pool, launching your own startup while dry powder is waiting to be deployed, or picking up the pace at a bogged down organization.
I’m confident that businesses, technology, and people in general will come back from this painful moment in time stronger for having endured it—something I feel this country did after the 2008 financial crisis.
So get ready for maximum effort.
Extraordinary Talent and Who’s Hiring
My heart goes out to all those impacted through job loss or economic hardship.
For those that are looking for roles, I’ve curated some job boards below and I invite you to review them or share them with folks who will find it useful.
For those that are hiring, Patrick Collison (the CEO of Stripe) has provided a way to contact former Stripe employees, Rex Salisbury has provided a great list of some of them, and there’s more talented people from Twitter, Stripe, Chime, Opendoor, and Lyft that are on the market.
Recommended Reading
Alex Johnson knocked it out of the park with his latest What is a Bank?
FT Partners released the latest installment of their "CEO Monthly FinTech Market Update & Analysis", which can be downloaded here.
Jason Mikula’s Money 20/20 Pre-Cap and Money 20/20: Fintech Forced to Grow Up were excellent as usual and well worth your listen and your read. As an engineer, I probably won’t ever go to Money 20/20 as it’s a much better fit for founders, venture capitalists, business development and sales executives but it’s great to get a gist of what’s going on.
This Week in Fintech’s latest article highlighted that Fintech funding dropped 38% this past quarter, which is intuitive given the cooling market.
Congrats to the Fintech Update folks on their first 1,000 subscribers! An incredible milestone!
Postscript
Did you like this post? Do you have any feedback? Do you have some topics you’d like me to write about? Do you have any ideas how I could make this better? I’d love your feedback!
Feel free to respond to this email or reach out to me on Twitter!
Data as of 11/06/2022.