You may have heard that we recently let some employees go at Amazing.com. While this is true, there are some facts and details that I feel it’s important to share.
We let 32 of our 62 employees go recently. It was not easy. In fact, it was the hardest thing I have ever had to do in business. I hated it.
The strategic necessity became clear when we shifted from offering big ticket courses to our new eLearning platform, offering a broad range of courses for a flat monthly fee. Our business model changed, so the business had to change with it.
I have shared the details below, to help those involved and those affected to understand the situation. I can say with absolute certainty and clarity that the company is now in a great position.
We’re completely focused on creating the finest entrepreneurial education platform on the planet. That has been our mission and will remain our focus now and into the future. Amazing.com continues to drive towards our goal of helping millions of entrepreneurs worldwide.
Clearing the Air
It’s easier to bury our heads and keep pushing forward.
On April 25th, 2016, I let go of 32 of our 62 employees.
Many of these people were friends that I’d gotten to know over the past two years.
It was easily the hardest thing I’ve ever had to do in business.
But, there was no other option.
We had ramped up from 10 employees to over 60 in about a year. We were growing so quickly, and just kept adding people to plug holes in the business.
The faster we grew, the more out of control the business got.
Our Cracking Foundation
The most frustrating thing was to see all the opportunity sitting right in front of us that we couldn’t do anything about. We had lost our ability to execute.
There were too many people pulling the company in too many different directions. Our foundation was cracking.
Early this year, we made the decision to completely change our product focus. Instead of offering high-priced courses – typically from $1,000 to $5,000 – we decided to create the best eLearning platform in the world for entrepreneurs. This platform would have thousands of courses, all available for the low monthly fee of $39.
Our goal is to help millions of people around the world start and grow successful businesses. We know how to do it – we’ve already helped thousands of people start businesses. But we couldn’t seem to get anything done.
The company had become sluggish and bloated. The culture had deteriorated into a place where people had to walk on eggshells, and couldn’t get any work done at the office because of all the distractions and negativity.
Our payroll had ballooned and our results weren’t justifying the extra expense.
Our new focus had to be on creating the best product possible. This means we would have to transition from a marketing-focused company to a product-focused company.
Trying to make this change with the current team was next to impossible.
We had an entire marketing team sitting by trying to figure out what to do. But it wasn’t clear what they should be doing because we were no longer putting such a big focus on marketing. We now were putting everything into creating an amazing product.
We had an entire finance team that we had ramped up, primarily to support affiliate transactions and multiple high-priced products. This large finance team (for a company of our size) wasn’t necessary any more because of our new hyper-focused product offering.
On top of that, we had a project management team that we added to help organize all the chaos. This team was necessary when we were spinning our wheels in so many directions. Now we weren’t.
I had to do something.
My Decision and the Ideal Company
As CEO, the results of the entire company are my responsibility. The culture is my responsibility. The future is my responsibility. The financial well-being of the company and those within it are also my responsibility. All of these I take very seriously.
So I sat down and thought, “What would this company look like right now, with our extreme focus on product quality?”
I outlined the ideal company. This included the teams and the roles within each team required to create an incredible product for millions of people.
Then, I looked at all the people in our company and decided which of those people should fit in each of the available roles in this ideal company.
Some people didn’t have roles to fill. Some people were a better fit for certain roles than others with similar skills. And, some just weren’t good culture fits.
There were 32 people left over. These people didn’t have good roles to fit within this new structure required for us to execute and push forward.
This was by no means an overnight process. For months I’d been trying to find a way to train people, to move people around, to change the teams, to do anything to avoid letting even a single person go.
But it wasn’t working.
And our results – and costs – were getting worse and worse every day.
So I felt my only choice was to transform – and reduce in size – our current company into the ideal company.
Without decisive action, we would all be negatively affected by long-term spending on extra staff without proportionate results. If I failed to act, perhaps the worst situation would have come to fruition. Instead of helping millions of people around the world, we may have faced a day sometime in the future in which Amazing.com would disappear. That would eventually hurt 100% of our employees and 100% of our customers.
On April 25th, I sent out 33 emails. I sent the first email at 2PM to let the entire company know I was letting go of a significant portion of the current team.
I sent the next 32 emails between 6PM and 6:30PM that night to each person that I was letting go.
When faced with the reality of this situation, there was a huge logistical issue with trying to talk to 32 individual people, face-to-face. In these situations, everyone wonders if they’re “next.” If I spent weeks or months letting 32 people go one-by-one, I was afraid the entire company would seize up and stop functioning.
So the decision to send individual emails to each person involved was made by me, and I stand by it. It was not my first choice, but it seems like it was the only choice. Each of these people contributed to the company, and it perhaps would have been better to sit down with each person one-by-one to explain what was going on. But time just didn’t allow for this.
I hate firing people. It’s the worst thing in business. The pressure and, yes, fear of doing it 32 times in a row was daunting. But, most importantly, I couldn’t risk the potential catastrophic effect of paralyzing the company for weeks, while everyone stood by wondering if they were going to be let go. I understand that there are certain people who will judge me for letting employees go via email. I understand that and I will live with it.
I felt that there was no other choice. I did what I thought was necessary for the long-term survival and success of Amazing.com. There are millions of people in the world we want to help, and I can’t risk not fulfilling our mission.
The reality of letting people go, especially half the company, is a stark and cold one.
Those impacted have ranged in emotion from understanding to outrage. The Austin Business Journal ran an article with limited – and incorrect – information, and therefore much of it was false. Although the misinformation doesn’t accurately reflect the events, it does add to the uncertainty in the marketplace to our customers, which is not helpful.
The reality is that the 32 former employees who have lost their employment face a transition. Luckily, in Austin the business climate is pretty strong, and we are all doing the best we can to help them get back on their feet including our offer to serve as references for any of those that wish.
This has been a very rough 30 days, as you can imagine.
The impact of this transition wasn’t just felt by the employees that left. There were still 30 people that remained at Amazing.com wondering if they’d be next – or if the company was going to still exist.
My immediate job was to reassure them of our bright future.
There are hundreds of millions of people in the world that want to build successful businesses.
I know – especially after evaluating what’s out there – that we know how to create courses that teach people entrepreneurship better than anyone.
And, with our shift to our monthly membership model, we now have a better value than anyone else for people who want to start or grow a business. Anyone can learn how to become a successful entrepreneur from anywhere in the world for just $39 a month.
Lastly, we now have the right focus: quality over everything else. We’re building the world’s best multi-device platform and the best courses for anyone who wants to build a business. We’re putting everything into creating the best product possible.
Now we just have to execute.
We’re no longer distracted as a company. We’re not pulling ourselves in multiple directions. We’re completely focused. And, with the reduction in about one half of our payroll expense, we’re well capitalized with a sufficient financial runway to take advantage of all the opportunity in front of us.
And our culture is better than ever. We’re making great progress and we’re working together as a team like never before.
It’s been – and continues to be – a painful journey after letting go of half of the company, but it was a necessary transition.
We have a lot of work to do, but I’m excited about the future. I’m excited about what we’re creating. I’m excited about what we’re doing for the world.
Yet it’s hard not to think about the people no longer here. We had fun. We spent a lot of time together. Now we’re here and they’re on to the next chapter in their lives. I know it hasn’t been easy for them. And it’s a horrible feeling knowing that they’re in their situation because of a decision I made.
If anyone ever said building a company was easy, they were lying – or extremely fortunate.
I wrote this knowing that most of the people that will read it are entrepreneurs. You’re either a member of ours, or someone that we’ve reached through our training.
I hope you learn something about building a company from this – hopefully what not to do.
When you hear from someone that’s built businesses over decades and they say, “hire slow” or “hiring is important”, listen to them. I read countless books that gave me that advice, but when in the trenches of growth, I made the mistake of rushing hiring and forcing growth.
It’s easy to hire people. It’s horrible to fire people.
Don’t chase growth at all costs, chase quality. If you don’t, you’re likely to end up with a product or culture you’re not proud of.
Then, you’ll be faced with one of the hardest decisions you’ll ever have to face in business.
Matt Clark is the Chairman and Co-Founder of Amazing.com, a serial entrepreneur, and investor. He’s been featured on Forbes, CNBC, and Entrepreneur.com.