Tony Xu, CEO of DoorDash, released a statement Wednesday revealing that the company has laid off 1,250 employees. He went into detail about why these layoffs were necessary and elucidated the plan ahead.
“The pandemic presented sudden and unprecedented opportunities to serve the evolving needs of merchants, consumers and Dashers. 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.”
The sudden growth experienced during the pandemic, compounded by current economic challenges has necessitated the cuts, as the cost to run the business would outpace the company’s revenue.
When explaining the road ahead, he spoke about what the company has already created, and the opportunity that can be leveraged to continue to progress.
“The runway ahead is massive and we’ve built tremendous momentum,” he continued. “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 neighborhoods’ ethos and personalities.”
Xu noted that the new company size will help bolster the new strategic priorities, where the company will operate with the efficiency and creativity of a younger startup while taking on the responsibility of the larger corporation it has become.
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