Why Did Snap Drop 45%? Gorillas and Klarna Layoffs, Adam Neumann’s New Startup, and Coinbase Principles | E1468

TL;DR

Snap dropped 45% after CEO Evan Spiegel warned employees that the company would miss its earnings estimates. Episode 1468 also examines layoffs at instant-delivery startup Gorillas and buy-now-pay-later company Klarna, Adam and Rebekah Neumann’s tokenized crypto carbon-offset marketplace, and Coinbase’s live employee-rating system. Read on for the episode’s take on vulnerable industries, startup metrics, management, and surviving the market downturn.

Transcript

hey everybody it is wednesday to tuesday tuesday tuesday tuesday no it's tuesday happy birthday happy birthday producer nick happy birthday producer nick it's tuesday which means this is the hardest part of the climb that's right but tomorrow you're gonna get a little peek and you're gonna see the downhill for the rest of the week and yesterday was... Read More

Key Insights

• 💦 Snap's sharp stock drop highlights the impact of missing revenue and earnings targets.
• 😀 The instant delivery industry is facing challenges as companies like Gorillas shift their focus to profitability.
• 🥺 The buy now, pay later sector is experiencing a market downturn, leading to layoffs and a potential reevaluation of business models.

Questions & Answers

Q: Why did Snap’s stock drop 45%?

Snap CEO Evan Spiegel said in an internal memo that the company was going to miss its earnings estimates. The warning preceded a 45% decline in Snap’s stock in a single day.

Q: What do the Gorillas and Klarna layoffs indicate about the startup market?

The hosts describe layoffs occurring daily, including at instant-delivery startup Gorillas and buy-now-pay-later company Klarna. They connect these cuts to broader belt-tightening and concern that some industries and business models may be especially vulnerable.

Q: What should startups focus on during the market downturn?

The episode says startups need to think carefully about their metrics and how they will get through this period. It frames the repeated layoffs, even at strong companies, as evidence that tighter operating discipline is necessary.

Q: How does Snap’s one-day decline compare with other stock losses discussed?

Snap fell 45% in one day. The hosts contrast that with stocks such as Coinbase that had declined as much as 85% over six months from their peaks.

Q: What startup did Adam and Rebekah Neumann co-found and invest in?

The episode describes their venture as a tokenized crypto carbon-offset marketplace. The hosts present their return and the carbon-market concept as a less gloomy, but highly unconventional, part of the show.

Q: What employee rating system did Coinbase introduce?

Coinbase introduced a system in which employees rate one another live during meetings. The hosts say it draws from Ray Dalio’s rating system and uses an app.

Q: Why is Coinbase’s live meeting-rating system controversial?

The hosts frame it as either an optimization tool or a dystopian approach to workplace management. They compare the two reactions to “Atlas Shrugged” and “Black Mirror.”

Q: Why are meeting and management practices relevant to growing companies?

The episode says these practices matter to small companies, large companies, and businesses that are scaling. Coinbase’s employee-rating approach serves as one option in a wider discussion about management and best practices for running meetings.

Summary & Key Takeaways

• Snap's stock value drops 45% after announcing it will miss revenue and earnings targets.

• Instant delivery startup Gorillas plans to cut 300 employees, focusing on turning a profit and exiting specific markets.

• Buy now, pay later company Klarna lays off 700 employees as it raises funds at a lower valuation.

• The market decline raises questions about the sustainability of certain business models.