I talk to a few people every week who are worried that the software industry is imploding with all the big layoffs.
These layoffs and valuation haircuts only affect only a small segment of the software industry. But it looks like “everyone is doing it.”
Just like big funding, IPOs, SPACs, and crypto-craziness were about a small slice of the software industry a few years ago. It looked like that was the only way to play the software growth game.
Why did people think that sky-high funding, stock prices, salaries, and hiring in 2021 were going to last long or not end well?
- When things are booming nobody expects it to end. FOMO, greed, and the herd kick in.
Why do tech and news media (and our attention and clicks) focus on the extreme ups and downs of the few?
- Because there’s no “news” when you didn’t raise crazy funding and don’t have big layoffs 18 months later. The media pumps it going up and going down.
Look, 95% of bootstrapped and practically funded software founders and CEOs I talk to every week are doing just fine and their businesses are growing.
They didn’t over-raise, over-promise, and over-hire before and they aren’t laying off good people now.
Here’s another data point if you don’t believe me:
I list all the open jobs at all the software companies in Phoenix and Dallas on my website Gregslist dot com. We find all the software companies in these cities, not just the big or funded ones. And we list all their open jobs.
Open job listings at software companies in these cities have gone down only 20% in the last six months, but they are still up 50% overall from the beginning of 2021.
There are over 800 open jobs on Gregslist Phoenix and over 1100 open jobs on Gregslist Dallas.
Overall, tech is doing just fine, but most funded startups and public companies got ahead of themselves.
Google, Amazon, Facebook, Salesforce, and others that had big layoffs this month still have 50%+ more employees than they had two years ago. Things got crazy.
Overall, most software companies are doing fine.
Focus on your customers, products, employees, and sustainable growth and you’ll be way ahead in a couple of years.
It’s a great time to hire great talent too.
#practicalfounders
