I’ve been a bit surprised at the surprised response from some in the Minneapolis and St Paul tech community about the announced Code42 layoff and restructure. Some are worrying… wondering if it’s a “sign”.
I get that Code42 is one of our most high-profile tech companies. I get that they are the most likely talked about company to have an IPO.
And for the 55 people who have been impacted by this… this is a huge thing for them and we all need to help them find a soft landing, fast.
But what does it mean for the MN tech scene in general?
My opinion… nothing.
That’s right… absolutely nothing.
Here is the statement from Joe Payne, CEO:
“Code42’s evolution into a data security company has seen us advance our offering from IT infrastructure products to application security products. Now we are making some organizational changes to realign our resources around how we sell, deploy and support these new products in the market. These changes reflect shifts in our market and in the needs of our customers. They are not a reflection on the talented people whose positions were affected,” said Joe Payne, Code42’s president and CEO. “In 2018, we grew to approximately $115 million in annual recurring revenue. The steps we are taking today are focused on further accelerating our growth. With more than $30 million in cash and the backing of some of the world’s best investors, Code42 has the financial resources we need to win in the data loss protection market.”
And this from the StarTribune, Minneapolis-based Code42 to lay off 55 workers as growth slows
Code42 is like most companies, they are learning and evolving. They are trying new products. They are making decisions on which way to go.
With that comes change and that change at times will impact people. That part sucks. The impact on people. But I have a newsflash… this is normal.
Taking a few steps back, what is going on at Code42 is unique to them. It does not mean that Twin Cities startups are having issues. It does not mean generally that Minnesota tech companies are seeing slower growth.
All companies come with some risk. Some more than others. Target just reported higher than expected ‘18 holidays sales. My friends there are relieved. Particularly those who have been there long enough to experience the lower than expected sales years.
Startups have risks. Retailers have risk. SaaS companies have risk. Multinational companies have risk.
You have to figure out what your risk tolerance is and what best suits you.
This will not be the only Minnesota startup or tech company to have news like this in 2019. My 2019 Minnesota Jobs Prediction is direct… we will see more layoffs/reorgs, we will see more companies hiring and we will see more people taking a look at new jobs, careers and companies to work at.
After hearing the news (I was mentioned in a Tweet), I posted:
So far we have had 35+ companies say they are hiring.
Code42 will be OK and the 55 people impacted will find new jobs and companies.
While a little cautious because of national and international political and economic issues, I am bullish on the Minneapolis and St Paul startup and tech scene.
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