Startup charges $10K to soften the blow of layoffs
A new technology company is offering fellow startups a better way to lay off workers while also minimising the negative impact on their reputation.
US-based startup Continuum has recently introduced layoff support as part of its executive help solutions. The new product allows companies to hire seasoned executives part-time to provide expert advice on how to handle worker layoffs.
Continuum’s latest offering comes as the tech industry continues to grapple with poor market conditions. More companies are resorting to downsizing their workforce to stay afloat. Even big players such as Coinbase, Lyft, Microsoft, Netflix, Tesla, and Twitter were forced to cut the number of their workers.
However, small tech companies are the ones taking the brunt of the struggle. According to Layoffs.fyi, 387 startups have already reduced their staff by more than 56,000 workers so far this year.
Continuum is looking to help these startups by making the layoff process go as smoothly, strategically, and “humanely” as possible.
Read more: Ford to cut up to 8,000 jobs
The new layoff product leverages Continuum’s existing “labour marketplace”, where customers can find executives with experience solving the exact problem they have. The company claims that it can connect customers with the right executive within 48 hours.
Pricing for layoff support depends on the number of employees that the customer currently has. For startups with 20 to 100 full-time staff, they’d have to pay a one-time fee of $10,000 to lay off any number of workers.
Meanwhile, for companies with 100 to 250 full-time staff, they need to pay $20,000 for any reduction to their workforce.
Continuum will handle all payments, including contracts, invoices, payouts and taxes for the executive hired by the customer.
Why companies fail at layoffs
In an interview with TechCrunch, Continuum CEO Nolan Church explained why some companies end up bungling worker layoffs.
“If you really think about where these have gone wrong, all you have to do is look at Better.com,” Church said. “The CEO talks about himself, does the mass firing on Zoom, no individual communication … a total disaster.”
Read more: Better.com CEO returns, fuels Great Resignation
Mortgage firm Better.com came under fire after its CEO, Vishal Garg, fired around 900 workers via a single Zoom call in December. The move was heavily criticised for being "cold", "harsh", and “horrible”, especially since it occurred during the run up to Christmas.
For Church, worker layoffs are“ really not that hard to get right” as long as business leaders are focused on the right things.