Unicorn Darling Airbnb Lays Off 25% of Workforce: An Employee's Account of What Really Happened
If you took a poll amongst Singaporeans with regard to which companies they would like to work for.
Many would mention well-known technology firms like Facebook and Google.
Or even unicorns (a startup or private company with a valuation of over US$1.billion) like Airbnb or Grab.
And these aspirations aren’t merely pipe dreams.
In fact, Facebook is opening its first S$1.4 billion Asian data centre here in 2022.
Google is building its third data centre in Singapore to meet rapid user growth in the region.
And Grab has relocated its headquarters to Singapore as a staging ground to grow its operations.
The allure of these tech companies and unicorns are palpable.
Besides the promise of a well-compensated future.
These companies offer flexibility, meaningful work, and beautiful work environments which will trigger office-envy.
So, it’s understandable why many Singaporeans would aspire to work at one of these companies.
However, the onset of COVID-19 has wreaked havoc on many industries and sectors.
And some of these companies are, unfortunately, severely affected by this viral pandemic.
Take Airbnb for example.
It was a startup worth US$31 billion (S$43.4 billion) that had just announced its plans to go public in 2020.
But recently, it had to cut 25 per cent of its workforce as COVID-19 stalls global travel.
A Timeline of Events at Airbnb
The following is an account of Emily Koh as told to SeedlyReads.
Emily is an ex-APAC Regional Recruiter at Airbnb.
And unfortunately, part of the 25 per cent workforce cut in the company’s bid to change its business strategy due to COVID-19.
Most notably, the company — known for its appreciable work culture — has shown the world what it means to be sympathetic and compassionate.
By allowing its employees to leave with grace.
Everything kind of escalated really quickly beginning in February 2020 when Airbnb started imposing a hiring freeze across roles in China.
And announced that the China office will start to work from home.
While most of us outside of China’s business are not as affected.
We know that it will take a huge hit on overall growth and top-line as China is the fastest-growing vertical in Airbnb.
In the last 2 years, Airbnb has not just invested heavily to build what we call “China Corridors” to entice both leisure and business travellers travelling to China to use Airbnb.
But has also created localised strategies to break into tier 2-3 cities to promote local tourism.
All the growth Airbnb made in China in the last 2 years seemed to have suddenly disappeared as we exited Q1 2020.
As COVID-19 started its rampage throughout the rest of APAC and Europe, we started to put hiring on hold across all offices in early March 2020.
At this point, despite taking on a more precautionary approach, Airbnb still held a pretty optimistic outlook.
This was when CEO Brian Chesky started to touch on more sensitive questions in his weekly CEO Q&A.
He shared about Airbnb’s financial position.
And using our strong balance sheet and the “$2 billion we have in the bank” assured employees that we are prepared for a “9/11 scale storm”.
However… it was also the same period Airbnb extended the extenuating policy to refund guests of their fees if they meet the criteria and a $250 million pledge to support hosts.
When revenue plummeted significantly, we knew the company was burning money at a rate beyond sustainable.
It was also in the first week of April that Brian Chesky announced that the company raised $1 billion and within 2 weeks from that, we raised another $1 billion.
Throughout the announcements, Brian Chesky displayed a great sense of optimism and hope on the business and that the company will ride out the storm.
Employees, on the other hand, were more sceptical.
Questions on layoffs and other cost-cutting measures started to be a top voted question at the CEO Q&A week on week.
By the end of April, it was announced that Airbnb would prematurely end the contracts of most contingent workers.
Brian Chesky’s narrative has gradually yet swiftly shifted from optimism to pragmatism.
This was when he said, “nothing is off the table” to ensure that Airbnb survives the storm to carry on our mission of belonging and our aspiration of building a 21st Century Company.
5 May 2020
Then came our most dreaded fear…
What came after a global email from Brian Chesky, were 3 Townhalls put into our calendars.
One for the Americas, one for APAC (Asi-Pacific), and one for EMEA (Europe, the Middle East, and Africa) to announce the decision to cut 25% of the workforce.
In my almost 3 years with Airbnb, this was by far the most heart-wrenching and emotional address that Brian Chesky has given.
Brian cried and so did all of us.
To many of us, Airbnb is not just a company or a job.
It’s a company built on the culture of love and belonging.
It’s a place we call home and made lifelong friends.
The next few hours for my team and I were a cocktail of anxiety and grief.
Especially for those of us in the Recruiting team as we already had most of our work and projects put on hold since March.
Within an hour, most of us received a 1:1 calendar invitation from a senior member of our leadership team.
The layoff conversations were done with empathy and compassion.
And the personalised conversations also meant that impacted employees are all given the time and avenue to ask questions and clarify doubts.
Sympathy and Compassion in The Days That Followed…
Admiringly, what happened after the announcement was a lot less daunting than I have expected.
Most of the employees affected have nothing but carols of love and appreciation for the company and what has been done to support us.
Airbnb has not just given a generous separation package.
But the company has also launched a Talent Directory on the Airbnb website to help displaced employees find our next adventure.
For many of us at Airbnb, especially the more tenured employees, we have witnessed and have been through the growing phase of the company from a promising small start-up to a unicorn darling.
It was heartbreaking to see many of the teams that you have helped hire and grow, reduce in size or completely dissolve.
Even though my tenure with Airbnb has been cut short.
I am confident that Airbnb will be able to emerge stronger and more well-positioned to capitalise on the post-pandemic new world and thirst for travel.
Be it the Asia Financial crisis in 1997 or the Subprime Mortgage Crisis in 2008.
It may seem like everything is doom and gloom.
But like all crises in history, this too shall pass.
The best way to go forward is to keep our chins up and continue upgrading ourselves to be ready when the tide turns.
Seedly Contributor: Emily Koh
Emily Koh is an ex-APAC Regional Recruiter at Airbnb with prior experience in consulting and recruitment process outsourcing.
She has 6 years of Recruiting, Internal Mobility, and HR experience; and is a graduate from NTU’s Business School with a major in Human Resource Consulting.