Even in the best of times, the survival of a technology startup isn’t a sure thing. It can take several quarters (if not years) for a startup to become profitable—and another successful funding round is never a sure thing. With the COVID-19 pandemic impacting the economy, the situation for many of these new companies has become downright dire.
Since March 11, layoffs.fyi has been collecting and crunching public data about startup layoffs. Based on its calculations, some 477 of these firms have laid off a collective 61,357 employees in almost three months. That’s not to say that startups still aren’t hiring—in fact, the website has a crowdsourced list of small companies seeking talent—but for many, layoffs have become the key to survival.
Based on the data, San Francisco and New York City are experiencing the biggest burst of startup layoffs. Here’s a full, location-specific chart:
It’s logical that Silicon Valley and Silicon Alley (i.e., New York City) have been hit hardest, since those areas foster the largest networks of startups in the nation. Other tech hubs with significant startup presence, such as Seattle and Austin, seem impacted a bit less, although whether this is due to the relative size of their startup communities or another, unknown factor remains to be seen. It’s worth noting that, in Dice’s analysis of April job posting data related to the pandemic, Austin, Boston and Seattle all fared better than New York City and San Francisco when it came to year-over-year change in job postings.
Which startups have experienced the largest rounds of layoffs since the COVID-19 pandemic began? That’s an excellent question that layoffs.fyi also attempts to answer:
Unsurprisingly, the “startups” that have taken the biggest hits don't really fall into that category of company at all—for example, Uber is now a mature, publicly traded company that’s facing some existential pressures to its core ridesharing business. Nonetheless, layoffs.fyi includes these larger firms in its bucket of impacted startups.
As mentioned above, even though many startups are enduring rounds of layoffs, others are still hiring. There’s still demand for technologists with the right mix of experience and skills, especially those who can help keep companies’ infrastructure and products running through these trying times.
Visit our COVID-19 Resource Center, which aims to provide the tech community with the best, most up-to-date information on the novel coronavirus.
