Oooof…tough times across the virtual board.
I’m still waiting to see something similar from Wahoo at the very least, but there are other companies that I am wondering about as well.
Restructuring isn’t always related to down turn in business.
Working in the public sector, it is something we watch occur at a ridiculous frequency as they add more and more administrator/managerial roles over time until someone realises that there’s way too much “fat” and inefficiency.
Reading Ray’s article this seems like more of a “we can do this better” than “we are in big trouble” to me.
It also always seems like it’s a copycat world as well. One company does some layoffs. Other companies and their investors start thinking “hey. Is that something we should be doing?”
Not saying that’s happening here but it feels like it sometimes
It is somewhere in the middle…they aren’t “in trouble” like Wahoo, but they were not right-sized for their current size and growth patterns. It was a necessary correction.
Yup, I’m in the “it’s a bit O both” ideology. Unless they are trying to live in a vacuum or La-La-Land, the are tracking the economy on a broader scale, as well as looking at their numbers and making plans based on that. It is unlikely that it’s a simple either/or situation, IMO.
I like the point of cutting marketing spend to focus on their core. Although I feel bad for the people cut, of course.
Layoffs suck especially for those involved, but I’ve always been curious as to why Zwift has 500-700 (depending on source) employees?
My friend used to work for them a few years ago and it was bonkers how many roles they were creating! I guess they were vindicated a bit during Covid but now reality bites.
There goes my desire to pay more for this. That’s a lot of overhead to cut. When did employees become such a liability, a drain on finances. Employees ARE the company, aren’t they? Companies that cut high percentages of employees seem to be declaring they can’t manage their companies, rather then them doing things right. The economy seems to be getting so much better, and yet the gloom and doom being spread seems to be an effort to burn it all down, generically speaking of course. But slashing employees seems to be in season now. How much management is cut? Hmm. Not much from what I’ve read of those ruining workers futures. It’s always stressful being laid off/fired. Whose idea was it to hire so many people, and whose idea was it to thrown so many under the bus to look stylish.
And when does it end… Isn’t Zwift a private company? What investors are they trying to impress, but I guess it could be worse.
Mayyyyybe. In a twist of fate… TR will acquire zwift some day.
It does seem like ‘knifing the workers’ season. For some industries, it’s not at all easy. A friend is a commercial pilot, and he has been laid off from carriers a few times. They LOVE to have you come in at ‘the bottom’ with a new carrier, which of course means a HUGE cut in pay and doing ‘grunt work’ for months, a year or more, before you ride to the place you were before. He talked me out of a second carrier in aviation.
But they usually cut people AFTER a merger. They should just buy Zwift and get it over with? It would be perfect cover for slashing workers.
Good luck to those laid off. I’ve been laid off many times, and it just isn’t pleasant. One company called me back as a consultant, which was nice for a while. I made quite a bit more money, but that eventually disappeared too.
Forgive me if I’m misunderstanding your point in the last few posts, but did you mistakenly think TR is laying off employees when it’s Zwift?
Oops… Yeah, I did. It’s sometimes hard to follow when the competition is being discussed so heavily here. I’ll try to clean up my mess…
When you have rapid growth like Zwift did during COVID, you need to staff up….but once things start to slow down, you have to shift. The ideal is still a good, but slower growth rate….but if growth plateaus or even worse, you have to adjust your overhead. Zwift is clearly in a plateau right now (at best)
I don’t think the overall state of the economy is a good yardstick for a service like Zwift…if anything, it may be somewhat reverse-oriented to the economy….times are tight and people will drop gym memberships, stay in more, etc. When times are good, a service like Zwift may get jettisoned for other things. But mostly, with a dedicated user-base, I’d think the overall demand is pretty stable (as long as they pay attention to the core users)
There were reportedly cuts to management….they also did that when they axed the hardware initiatives.
They have received 100’s of millions of dollars from VC investors. Those guys don’t invest because they think Zwiftnis a cool company….they want a return on their money.
I agree with everything you said, but remember he was talking about TR, not Zwift. That changes some of those things, like investors, for example.
Well, despite Rob thinking this was TR instead of Zwift originally, the only edit he made to his posts was to swap the two company names in his OP. I think there was some confusion and jumping to conclusions, and some of that still remains in his post despite the name change.
The content in Ray’s article sheds light that goes beyond the typical ‘axe chopping’ that some associate with the term ‘layoffs’. It’s worth a deeper dive into the article as well as the one from the hardware elimination that shows what really happened and is coming for Zwift specifically.
Sure it sucks for those losing jobs, but this is not some blind bottom line slashing across the board. Add in the steps they are taking for those getting laid off, and Zwift seems to be taking some decent steps to do the best they can for these employees. This and the prior layoffs seem reasons and intentioned with an aim to keep Zwift pointed in the direction they see is best.
All of these folks that are hoping to 10x their money. Zwift - Funding, Financials, Valuation & Investors