Discord, a widely used chat and messaging app, has recently announced a significant workforce reduction, affecting approximately 17% of its employees, totaling around 170 individuals. This decision aligns with a broader trend in the tech industry, with giants like Google, Amazon, and Meta also undergoing similar restructuring.
In an internal memo, Discord’s CEO, Jason Citron, acknowledged that the company’s rapid expansion in the last three years led to overhiring, resulting in a decline in operational efficiency. Having grown five times its original size since 2020, Discord found itself stretched thin across numerous projects, prompting the need for a more focused approach to enhance organizational agility.
Citron expressed the necessity to confront hard truths, emphasizing the importance of sharpening the company’s focus and improving collaborative efforts. This echoes sentiments shared by other tech CEOs, including Meta’s Mark Zuckerberg and Spotify’s Daniel Ek, who have recently implemented large-scale layoffs to streamline their respective organizations.
Despite the workforce reduction, Discord remains financially secure, having secured approximately $1 billion in funding and holding over $700 million in cash. The company aims for profitability this year and has contemplated going public since rejecting a $12 billion acquisition offer from Microsoft in 2021.
In a gesture of support for the affected employees, Discord is providing five months of salary, continued benefits, three months of outplacement services, and equity vesting of awards scheduled for February 1, 2024.
This strategic move aims to ensure a smooth transition for departing employees while reinforcing Discord’s commitment to financial stability and sustained growth.