Hootsuite employees described internal chaos within the company and criticized management following the layoffs of about 10 per cent of staff earlier this week.
Messages sent in a private online group for employees obtained by The Logic describe panicked staff and public crying during the layoffs at the Vancouver-based social media-management platform.
Hootsuite has faced a number of challenges recently. In the fall of 2018, Twitter significantly increased the price Hootsuite needed to pay to access the platform’s data-rich application programming interface (API), which allows Hootsuite users to control their Twitter accounts through the former’s platform. A few months later, Facebook cut third parties, including Hootsuite, off from its API. And, in August 2018, The Logic reported that at least eight senior managers had recently left the company, and that its plans to IPO were likely on hold.
On April 29, Hootsuite CEO Ryan Holmes emailed staff saying layoffs were coming and would be completed by end-of-day on April 30. He said the firm would give a “full debrief” at a town hall meeting on May 2. “I appreciate these next few hours will be stressful,” he wrote.
Some employees said they waited at their desks the rest of the day for news about who would be affected. The majority of the cuts were in North America and Asia, with the Singapore office being closed entirely, according to a post from one employee. The company’s European workforce also saw reductions.
“The way this was handled…was insane,” wrote one employee. “You try sitting all day with that email hanging over your head and then being let go and bundled out the door as if you are a risk to company moral [sic] – as if anything could be more demoralizing than seeing valued colleagues get frog marched out of the office as they are crying. Absolute shit show.”
Another employee said one manager also wept. “I’m calling for a situation where a general manager doesn’t cry in front of a room full of people,” the employee wrote. “I have been witness to many restructures, layoffs etc throughout my career and have never seen anything as miserable and cowardly as this.”
Holmes did not reply to multiple requests for comment regarding the concerns employees raised in the group about how the company handled the layoffs. Naomi Hurley, vice-president of public-relations firm Access Brand Communications, emailed a statement on behalf of Hootsuite: “We remain committed to helping employees affected by today’s announcement through these times of transition. Our goal is to ensure they are treated with dignity and respect.”
Hootsuite has raised at least US$299 million since it was founded in 2008. Most recently, it took on US$50 million in credit financing from CIBC in March 2018. Hootsuite has also made a number of recent moves to bring in new revenue streams and reduce its reliance on Facebook and Twitter. In December 2017, the company reached a partnership with Adobe. Hootsuite also integrates with Instagram, LinkedIn and YouTube, and has supports for Reddit, Storify, Tumblr and Marketo.
Despite the diversification, Hootsuite abandoned its IPO attempt and instead tried to look for a buyer. However, it ended that process in December 2018 after it couldn’t find one to meet its hoped-for US$750-million valuation, The Globe and Mail reported in January.
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Multiple employees cited the company’s relationship with Twitter—which asked Hootsuite to start paying $75 million for its services, about 10 times what it had previously charged, in fall 2018—as the cause of the layoffs. “Blame Twitter partnership. We have to pay them now,” wrote one employee.
Some employees raised concerns about what they perceived as a lack of transparency within the company. “No consideration whatsoever for people who gave their heart and soul for this company,” one wrote. “They may have their reasons but there are ways to treat people with respect, specially [sic] if they have given you so much. Faith lost in this company.”
Holmes has faced employee dissatisfaction over the company’s direction and leadership before. After a town hall he held in July 2018, one employee wrote in the private-messaging group, “This is about my twentieth town hall and this was one of the worst… No celebration or wins. Bland generic answers. No clear path. Director levels feel the same way.”