Twitch layoffs and what's next

So, what’s next?

The main thing I want to address is the animal in the room: the recent Twitch layoffs. I’ve avoided making a public comment for some time, but I also think I would be doing a disservice not talking about it since I think I have some valuable insights from working there.

Precursor

Twitch is a good place to work and most people will tell you that. There’s a lot of good things about working there and I don’t regret it for what it’s worth. Even across various different teams this is broadly the consensus. One of the main highlights for me is the sense of social cohesion the company has in terms of a shared common interest, which is a really powerful thing.

Why the layoffs happened

Twitch burns money and was late stage. I don’t think it was ever profitable but it may have been early on. From being sold it was unprofitable for roughly a decade and the covid boom was the last nail in the coffin forcing Twitch into a corner where it had effectively promised linear growth and underdelivered after seeing a decline in viewership post covid. As a result they fired 1000 people each making on average 100k a year saving the business a lot of money. There is absolutely no way the company even does that much in total revenue when multiplied out. And so, having employees was costing the business significantly more money than they generated. Yes this is fairly reductive, and yes there are more reasons the layoffs happened, but this is the bigger picture. It’s entirely possible the business generates some profit but it’s probably not a lot.

Simply put: it was pretty obvious that there was no reason you needed that many people to run a livestreaming site, sans people working in video or on the main page/advertising. A lot of the extra branches like teams I was on (safety) were just afterthoughts and not super important that they exist long term having solved the problem they were designed to exist for.

From here Twitch is still underwater and will be underwater for a long time. It’s not exactly clear what the business value of the company is if it will never generate revenue besides being an umbrella branch of Amazon and we can only speculate why that’s important to Amazon’s business interests beyond being able to target advertising (which still hasn’t been successfully done at Twitch).

Why I wouldn’t work there again

Twitch was a really great place to work at its peak but it became very bogged down in meme Amazon process for a medium size company. The result was people feeling like stuff just moved way too slow. It was also very much a “manager” schedule as opposed to a maker schedule on my team. Even at Amazon there was actually less process and less bs process than what I noticed at Twtich. Btw, I highly recommend this video if you want to learn more. A general symptom of this type of environment is a lack of growth and a culture of fear. To be fair, Twitch’s growth curve for engineering is a lot better than at other companies and I’d argue there are more opportunities in general than a lot of FANG companies if you make those opportunities happen, but it still wasn’t the case that every team had a sense of growth or direction.

In my opinion there were problems that were worth solving at the company but it was not possible for people to do so and risk taking wasn’t encouraged (red tape). Additionally lots of runway was given to external facing product teams, but teams that powered those external facing products received very little care. In the event that you did find time to work on something, there was meetings for everything and it really wasn’t a “maker culture” or as productive as you’d think. Sometimes you would straight up just get re-orged/assigned to work on something else after investing months into a project (hard to push back against leadership).

There was a lack of trust down on the engineering side of things, meaning that it was very hard to get the greenlight on a lot of projects. I also don’t think speaking up was as encouraged as people made it seem and there was little visibility from leadership/communication down the ladder. Pre covid seemed to be a huge growth period then beyond that it died down. It wasn’t a startup-ey or scrappy environment anymore. It definitely was possible to grow but nothing like pre-covid in terms of opportunity.

Why this relates to software engineering in general

In my opinion if you want to have the best experience at any company, particularly in software engineering start by looking for teams that trust developers/engineers to make the right decisions. You should look to have a manager you can communicate honestly and openly with and someone that you would want to work hard under.

Whenever a business gets too large it just starts to move a lot slower and it becomes hard to run lean functional teams so a lot of this lack of trust emerges. But functionally if you could do more with less you would be foolish to not try to maximize your output with more employees.

Additionally whenever a business is targeting a market and is losing money a lot of this just goes out of the window anyway. On the macro you have a problem where you overhired to solve an output problem, but on the other hand you’re making even less money because the business makes less. So there’s just no winning.

The end state for a lot of companies looks a lot like the outcome Twitch if nothing changes about the over-management of what would-be small businesses.

What’s next

I’m currently working a new role at AWS and it was a needed switch. So far I’ve noticed that the development and iteration process is quicker, the engineering bar is higher and there’s overall a lot of crazy growth. While I don’t think I’ll stay in software engineering forever, so far I don’t dislike it and I feel like my career experience has been pretty much what I expected.

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