How to handle layoffs with compassion with Ayal Yogev, Anjuna

Growth-at-all-costs mentality forced overhiring

The 2021 venture environment rewarded hypergrowth and aggressive hiring ahead of demand, making it difficult to raise capital without demonstrating rapid expansion regardless of efficiency.

Investor priorities flipped overnight

When the market shifted in 2022, investors suddenly demanded capital efficiency over growth rates, forcing immediate workforce reductions across the startup ecosystem.

First cuts are rarely deep enough

Anjuna required two separate reduction rounds because initial cuts proved insufficient to achieve necessary runway, with the second round damaging team trust more severely than the first.

Maximize generosity within financial constraints

Provide maximum feasible severance and extend healthcare coverage beyond typical periods to ensure departing employees avoid medical coverage gaps during transitions.

Activate networks for job placement

Leverage investor relationships and portfolio company connections to actively share resumes and facilitate introductions for terminated employees seeking new opportunities.

Contextualize as market conditions

Frame layoffs as industry-wide market corrections rather than company-specific failures to preserve dignity and help remaining employees understand the necessity of the decision.

Hire only after contracts are signed

Shift from anticipatory hiring to contract-triggered staffing, specifically waiting until large enterprise deals close before adding customer success or account management roles.

Pre-negotiate executive separations

Establish clear separation terms during the executive hiring process—similar to a prenup—to prevent messy departures and reduce legal friction when leadership changes are necessary.

Culture lives in daily decisions, not wall posters

Define company culture through consistent micro-actions—such as respectful treatment of rejected candidates and departing employees—rather than mission statements or posted values.

Adopt 'care' as the core value

Implement a single-word cultural philosophy focused on genuine care for employees, customers, and vendors to maintain cohesion and trust during difficult organizational contractions.