It’s been a rough few months for many startups, particularly those in turbulent subindustries such as cryptocurrency. Some startups have gone out of business, while others are slashing staff and projects in a despite bid to survive.
What’s behind these recent cutbacks? Fears of economic uncertainty have led many funders to close off their cash spigots. For those startups that depend on advertising, innovations such as Apple’s latest privacy controls have limited their ability to harvest and monetize user data. Still other startups have simply burned too much cash in pursuit of perfecting bleeding-edge technologies like augmented reality (AR) and virtual reality (VR).
Whatever the cause, it’s clear that layoffs have picked up again. The following chart is generated from layoffs.fyi data. Because this data is crowdsourced, it might not present a complete picture of the industry; nonetheless, it reveals some key trends. Take a look:
Startup layoffs have risen significantly over the past two quarters, but they haven’t reached the level of Q2 2020, when the COVID-19 pandemic unleashed a sudden wave of economic devastation. Layoffs have hit startups in multiple industries, including crowdfunding (Patreon is cutting stuff), online media (Medium is reducing its headcount by 25 percent), and social media (Snap recently announced plans to cut 20 percent of its staff).
Despite the turbulence, many technologists still find startups an attractive place to work. With smaller staffs, you may have more say over projects and strategy; less bureaucracy means initiatives can move faster, as well. Then there’s always the possibility (however distant) of a big IPO or acquisition payout.
Depending on their funding and other factors, startups can also pay well. Earlier this year, a survey by Arc suggested that, for remote developers in the U.S., a job at a late-stage startup can pay an average of $145,000 per year, which is 11.5 percent higher than they’d earn at a public company ($130,000). On top of that, 14.7 percent of remote developers working for late-stage startups reported receiving stock options, versus 12.4 percent of developers at public companies.
If you’re at a startup going through turbulence, it’s never a bad idea to keep your resume (and skills) up-to-date. You never know when you might need to jump to a new (and hopefully better) opportunity.