Dropbox CEO ‘Takes Full Accountability’ as He Fires 500 People

Words don’t look to mean thing these days. Dropbox CEO Drew Houston this week told employees helium takes “full accountability” arsenic helium announced a circular of layoffs affecting 500 employees. He is, arsenic acold arsenic we tin tell, remaining connected arsenic CEO and continues to clasp a multiple-billion dollar ownership involvement successful the unreality retention company.

“As CEO, I instrumentality afloat work for this determination and the circumstances that led to it, and I’m genuinely atrocious to those impacted by this change,” wrote Houston according to The Register.

“I cognize this is incredibly hard and unwelcome news. To everyone leaving Dropbox, I’m profoundly grateful for everything you’ve done for our institution and our customers.”

Employees affected by the cuts volition person a minimum of sixteen weeks’ wage and their banal grants for Q4 2024 volition vest. They tin besides support their enactment computers. Dropbox chopped 16% of unit successful 2023 amid a question of cuts crossed the manufacture pursuing years of overgrowth during the pandemic. Revenue maturation has been dilatory astatine Dropbox, successful the single-digits much recently.

Dropbox started arsenic a sleek and casual mode to back-up files online, but has not rather been the large occurrence communicative that was erstwhile hoped. To beryllium sure, it has a marketplace worth of implicit $8 billion. That’s awesome but not the level of homerun that investors and employees anticipation for erstwhile they motion up to articulation a fast-growing tech company. Dropbox’s banal is down 10% successful 2024, which is atrocious for workers astatine these companies arsenic their wage is often heavily-weighted towards shares.

Leaders often assertion that they are taking accountability erstwhile they screw up—and they should, arsenic CEOs similar Houston are the ones who mismanaged the institution to the constituent of requiring layoffs successful the archetypal place. But seldom does “taking accountability” really magnitude to overmuch of anything. The astir notable caller illustration is possibly that Microsoft CEO Satya Nadella asked the company’s committee to trim his wage successful airy of the large Crowdstrike hack. But successful that case, his wide compensation inactive accrued for the twelvemonth by $30 million. Just, a small less up.

Houston arsenic a co-founder of Dropbox holds astir 20% of the equity successful the company, and can’t truthful easy beryllium removed. But for different leaders, 1 statement made to enactment these ample compensation packages is that their jobs necessitate taking the brunt of pugnacious decisions, and that they would beryllium successful precocious request astatine different companies. Meta’s Mark Zuckerberg took a batch of flak aft creating a bloodbath astatine his institution during the pandemic, cutting ample swaths of the organization. You person to wonderment if immoderate different CEOs would really beryllium successful specified precocious request though. Maybe Nadella oregon Zuckerberg’s compensation is justified but it’s harder to accidental Houston would fetch a precocious mega-package elsewhere.

Dropbox for years has been outgunned by its bigger rivals that likewise connection unreality retention but astatine a overmuch larger scale. It besides faces accrued contention successful productivity bundle from the likes of Google and Microsoft, which person been investing heavy successful AI that is expected to assistance radical enactment much productivity (the assemblage is inactive precise overmuch retired connected whether it’s helpful).

It’s hard for a institution similar Dropbox to vie against the large guys, but it’s been investing successful its Dash AI hunt instrumentality that’s expected to marque it casual to hunt crossed assorted productivity apps.