How the great tech layoff is having unexpected positive consequences
The wave of layoffs to have struck the tech sector over the past year is conversely boosting the flow of top talent into early-stage start-ups, a top venture capital firm has said.
Venture capital firm Antler, which runs an accelerator programme in 27 countries and claims to be the most active angel and seed-stage investor globally, today said the free flow of experienced talent into start-ups is at a peak because of thousands of job losses at bigger firms.
“Talent is more abound,” Antler chief Magnus Grimeland told City A.M.. “If you try to hire a great engineer in 2021, it’s very difficult, you try to hire a great engineer now, it’s much easier.”
Antler’s UK chief Jed Rose added the firm had seen talent “continue to get stronger” as bigger firms let scores of staff go.
“[Because of] the recent layoffs in the past year at some larger companies, we’re seeing people who are coming in with more experience than ever,” he said. “And not just more experienced – more experienced in high growth VC-backed startups.”
While Antler, which launched its first programme in 2018, typically invites first time founders into its programmes, the current crop are now arriving with years at the top of companies.
The average experience is now seven years, with 60 per of those made up of prior founders, Antler bosses said.
The numbers cast a potentially more positive light on the grim waves of layoffs to have hit some of the worlds’ biggest tech firms over the past 18 months.
Some 1,061 tech firms globally have already given 242,481 staff their marching orders this year, eclipsing the 164,769 laid off last year, according to tracker site Layoffs.
Among them have been household names like Meta, which slashed 10,000 jobs earlier this year, and Spotify, which slashed its 9,800 strong workforce by six per cent in January.
Layoffs among VC-backed firms have been fuelled by a slowdown in the amount of cash flowing into the sector this year.
Global VC investment slumped to its lowest level since the final quarter of 2016 over the summer as investors pumped just $73bn into companies across 7,434 deals.
However, Antler’s global chief Magnus Grimeland told City PM the firm had so far managed to shrug off the worst of the downturn.
“Our investment pace is currently growing about 30 per cent. In three years, we actually have made more investments every year,” he told City PM “Our founder application rate is growing 100 per cent per year.”
Antler has a 15 strong team in London and has backed some 86 startups in the UK. The firm typically invites 70 founders take part in its programmes before investing in a select few.