DoorDash CEO Tony Xu all apologies as he lays off 1,250 employees
Rapid delivery big hitter, DoorDash, is laying off 1,250 people as it looks to rein in costs.
CEO Tony Xu said in a message to employees: “This is the most difficult change to DoorDash that I’ve had to announce in our almost 10-year history.”
“Today, we are reducing our corporate headcount by approximately 1,250 people and saying goodbye to many talented teammates. If you are among those impacted, I am truly sorry and I apologise to have some of you wake up to this news as opposed to reading it during more normal hours.”
Xu went on to say that, prior to Covid-19, DoorDash was undersized as a company. The pandemic presented sudden and unprecedented opportunities for the company.
“We sped up our hiring to catch up with our growth and started many new businesses in response to feedback from our audiences,” Xu said.
“Most of our investments are paying off, and while we’ve always been disciplined in how we have managed our business and operational metrics, we were not as rigorous as we should have been in managing our team growth. That’s on me. As a result, operating expenses grew quickly.”
In terms of the macro situation, “our business has been more resilient than other e-commerce companies, but we too are not immune to the external challenges and growth has tapered vs our pandemic growth rates.”
“While our business continues to grow fast, given how quickly we hired, our operating expenses – if left unabated – would continue to outgrow our revenue.”
Xu added: “I did not take this decision lightly. We have and will continue to reduce our non-headcount operating expenses, but that alone wouldn’t close the gap. This hard reality ultimately led me to make this painful decision to reduce our team size.”
He insisted that he continues to be very optimistic about the future and convinced of the importance of the role his company can play in the world.
“DoorDash has always been a resilient company. For the first half of our history, we were constantly cash-starved and under-resourced compared to our peers. Today, we are a market leader that is still in its early innings of becoming the defining local commerce company globally.”
Xu declared: “The runway ahead is massive and we’ve built tremendous momentum.”
“If we can achieve our mission to grow and empower local economies around the world, not only will we prosper as a business but I also believe much good will be achieved as we create a world where millions of merchants can thrive, bringing out the best of our neighbourhoods’ ethos and personalities.”
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