Snap Fires 20 Product Managers
Introduction
On November 8th, 2023, Snap Inc. announced it laid off twenty employees, all holding product management titles.
This review sheds light and provides context to this layoff.
Snap Inc.
Snap Inc. is an American company founded in 2011 by four Stanford University graduates.
Snap’s main product is Snapchat, a smartphone social media messaging application whose main feature is expiring photos and videos.
In 2014, Snapchat was monetized with advertising.
From 2014 to 2018, Snap also provided a peer-to-peer payment service (similar to Venmo) named Snapcash.
Snapchat’s growth has been steady, with over 400 million active users worldwide and over 5 billion “Snaps” created daily during 2023.
Snap Inc. is publicly traded and reported US$4.60 billion in revenue in 2022 and over 5,000 employees.
In conjunction with its success, Snap Inc.’s reputation was tainted by lawsuits, hacking, US Federal Trade Commission (FTC) complaints, privacy concerns, internal data abuse, dissemination of illegal content, crude human resources management, and notable layoffs and departures.
Snap Layoffs
In January 2018, Snap laid off 25 employees from its New York and London offices’ content teams as part of an ongoing search to “find the right people for the job”.
In March 2018, Snap laid off about 100 employees from the advertising and sales departments.
In March 2018, Snap laid off 120 engineers to “streamline and unify Snap’s engineering team”.
Coming out of the COVID-19 pandemic and fearing a recession, in August 2022, Snap laid off about 1,300 employees and canceled several product projects.
In September 2023, Snap laid off 170 workers following the closure of the Augmented Reality Tools For Business department.
In September 2023, Snap closed and released all employees from the Berlin-based AI startup Fit Analytics, which Snap had purchased in March 2021 for US$124 million.
In October 2023, Snap’s VP of Product was dismissed and replaced by a senior director from Snap’s design team.
One month later, in November 2023, Snap dismissed 20 employees with product management titles who worked on various products at different departments to “increase decision-making speed and reduce overhead”.
Senior-level departures en masse happen at Snap.
In early 2017, Snap’s VP of Engineering, VP of Sales, VP of Product, and General Counsel left the company.
The late 2023 layoffs were accompanied by high-level resignations of Snap’s VP of engineering, Chief Operating Officer (COO), and two senior ad executives.
The aforementioned are examples of recent prominent Snap layoffs and shakeups. There were other smaller and less publicized layoffs.
Snap’s founder and Chief Executive Officer (CEO) Evan Spiegel’s leadership style and strategic decision-making have been scrutinized and critiqued.
Product Managers Layoff
There is no clear indication of why, in November 2023, Snap dismissed twenty product managers.
These layoffs occurred despite Snap growing its headcount in other departments and beating analyst expectations with 2023 third-quarter earnings that grew by 5% to US$1.19 billion.
No serious judgments can be made from Snap’s bland company message that the layoffs were to “increase decision-making speed and reduce overhead”.
There is no significance that Snap’s press release mentions the dismissed employees are from product management.
Mentioning the affected department and roles is done for full disclosure, and Snap indicates the same when laying off people from engineering, sales, marketing, content, executives, etc.
It is pointless and irresponsible to speculate what internally happened at Snap and to attempt to draw any macro conclusions without knowing anything.
Insecurity Among Product Managers
Snap’s November 2023 product management layoff exposed a great deal of insecurity among product managers.
In blogs, social media, Reddit, Quora, and LinkedIn, product managers asked if there is a broader meaning to the layoffs and if there is an ominous trend in the making.
Some product managers question if the Snap layoff means that product management is on the path of being demoted, downgraded, deprioritized, unnecessary, or eliminated.
Others ask if it’s all a power grab by the engineers to take over the product or a new era where Artificial Intelligence (AI) applications replace product managers.
Here is what’s actually happening.
Product managers realize that many technology companies, even the big ones, need help understanding product management, its purpose, and its contribution.
This realization has caused apprehension among product managers, and any publicized industry layoff involving product managers triggers their insecurity.
Stoking the fire of insecurity are product management’s naysayers and doubting statements.
For example, Ryan Singer, the author of Shape-Up, questioned if “Product engineering overtaking product management”.
Brian Chesky, Airbnb’s CEO, said that “We got rid of the classic product management function”.
Such statements prompt negative thinking and even anxiety among product managers.
The Reality
Ongoing layoffs, employee churn, and executive departures are common occurrences at large, financially stable American technology companies, and layoffs happen for numerous reasons, even when the going is good.
Markets and earnings are affected by technological, social, economic, political, and geographical factors, and a company’s headcount is correlated accordingly.
Layoffs, such as those recently undertaken by Snap Inc., are to be expected in modern technology companies.
From the employees’ and general public viewpoint, a company is graded more by how it handles the layoff process than by the act of laying off.
All this has nothing to do with product management or the demand for product managers.
All indicators show a solid job market for product managers; demand is relatively steady in 2023 and should remain so in 2024.
Many well-paying open product management positions exist.
Recruiters wish for more qualified candidates.
The current US inflation rate in 2023 is 3.2%, which slightly affects consumer purchasing power and may slow economic growth.
The Federal Reserve interest rate is 5.5%, slowing the US economy.
There will be more hiring across all job markets if and when inflation stabilizes and the federal interest rate decreases, thus making borrowing cheaper and more attractive.
A note about AI: product management has always reaped the benefits and productivity enhancements associated with new technologies.
Although modern technology can automate many tasks, a significant part of product management work is social and hinges on human interaction.
The safest jobs from emerging AI applications require strategic thinking and many deliberations with other humans, like executive management and product management.
Summary
Gone are the days when people entered a large company such as IBM, Ford, or General Motors and retired after thirty years from that very same company.
Layoffs are the modern norm, especially in the tech world, whether in a startup or multi-national enterprise.
Snap’s November 2023 product management layoff indicates nothing substantive other than exposing product managers’ insecurities.