Popular delivery service DoorDash is laying off 1,250 employees. The company announced the layoffs as part of its cost-cutting efforts. The company also wrote a message to its employees informing them about the job cuts. DoorDash had 8,600 corporate employees as of December 31, 2021.
“Today, we are reducing our corporate headcount by approximately 1250 people and saying goodbye to many talented teammates. If you are among those impacted, I am truly sorry and I apologize to have some of you wake up to this news as opposed to reading it during more normal hours,” said Tony Xu, CEO DoorDash.
The company also mentioned that it will offer 17 weeks of severance to the impacted employees and the health care support will continue till March 2023. The company further added that the termination date will be March 1 for overseas employees or visa-sponsored employees.
Read the complete message here
This is the most difficult change to DoorDash that I’ve had to announce in our almost 10-year history. Today, we are reducing our corporate headcount by approximately 1250 people and saying goodbye to many talented teammates. If you are among those impacted, I am truly sorry and I apologize to have some of you wake up to this news as opposed to reading it during more normal hours.
I know that for many of you, today’s news will come as a shock, especially because our business remains strong and continues to grow. That is why I think it is important that I explain how I arrived at this decision, what we are doing for those departing DoorDash, and why I’m optimistic about our future.
How We Got Here
As with all things, I want to start and discuss the factors in our control that led to today’s announcement and take accountability for this decision. Prior to COVID-19, DoorDash was actually undersized as a company. The pandemic presented sudden and unprecedented opportunities to serve the evolving needs of merchants, consumers and Dashers. We sped up our hiring to catch up with our growth and started many new businesses in response to feedback from our audiences.
Most of our investments are paying off, and while we’ve always been disciplined in how we have managed our business and operational metrics, we were not as rigorous as we should have been in managing our team growth. That’s on me. As a result, operating expenses grew quickly.
Now, let’s acknowledge the macro situation. Our business has been more resilient than other ecommerce companies, but we too are not immune to the external challenges and growth has tapered vs our pandemic growth rates. While our business continues to grow fast, given how quickly we hired, our operating expenses – if left unabated – would continue to outgrow our revenue.
I did not take this decision lightly. We have and will continue to reduce our non-headcount operating expenses,but that alone wouldn’t close the gap. This hard reality ultimately led me to make this painful decision to reduce our team size.
Support for Departing Teammates
Working at DoorDash means chasing excellence every day. Those of you who are departing chose that pursuit, and I’m grateful to each of you in helping DoorDash get to where it is today.
For those impacted, you will be receiving an email notification in the next 15 minutes on your personal devices to both your DoorDash and personal email address.
Here’s how we will support you during this difficult transition period:
Pay + RSU vest: Anyone impacted will receive 17 weeks (13 weeks + 1 four-week lump sum severance pay) of compensation, as well as your February 2023 stock vest.
Healthcare: All health benefits will continue through March 31, 2023. Thereafter, employees will be able to opt in and pay for COBRA coverage for up to 18 months.
Immigration support: We will set the termination date for March 1, 2023, giving those with visa applications (and a desire to stay in the US) as much time as possible to find a new job.
Career transition: We will create an opt-in directory for companies to reach you and offer recruiting support to help you find your next job. You are among the hardest working, most committed, operationally excellent people companies could find, and we are confident you will add value to any new organization you join.
Some of these details will differ for our teammates outside the US, and every impacted employee will receive an email with information specific to them. For the Wolt team, you’ll be hearing soon from Miki.
While there is no great way to manage this process, we strive to treat each of you with respect and integrity. Each of you who is impacted will have the opportunity to speak to a leader this week. We’ll be sending information on getting these conversations scheduled in addition to outlining other details including a process for you to say goodbye to teammates and access necessary systems to obtain information about expenses and payroll.
The Path Forward
While I want to focus today’s attention on our talented teammates who are departing, I did want to say a few words to the team that is staying and carrying the baton. While today’s news is painful, I continue to be very optimistic about our future and convinced of the importance of the role we can play in the world.
DoorDash has always been a resilient company. For the first half of our history, we were constantly cash-starved and under-resourced compared to our peers. Today, we are a market leader that is still in its early innings of becoming the defining local commerce company globally. We’ve grown from one business (our US Restaurants Marketplace) in one country, into five businesses serving 27 countries, across merchants in every category of local retail on both our Marketplace and Platform. Our business – just like the local economies we serve – has been resilient and our execution has been dynamic in the face of a global pandemic, persisting inflation, an energy crisis, recessionary demand, and a war. The runway ahead is massive and we’ve built tremendous momentum. If we can achieve our mission to grow and empower local economies around the world, not only will we prosper as a business but I also believe much good will be achieved as we create a world where millions of merchants can thrive, bringing out the best of our neighborhoods’ ethos and personalities.
Just as our mission hasn’t changed, neither has our strategy. Our business fundamentals remain strong. But as I’ve said before, what got us here won’t necessarily bring us to the next stage and we have to tailor some of our tactics. Looking ahead, we’re confident that we have reset the size and shape of our organization to match our strategic priorities. We must keep this level of discipline moving forward and act with the hunger, efficiency and creativity of the younger startup we once were while leading with the responsibility of the market leader we’ve become. One outcome from this approach is that we’ll continue to hire and add back recruiting capacity in a more targeted and rigorous way. We will discuss how we will do this together as a team and answer your questions at an All Hands later today.
Throughout the different phases of our journey, we have built a company that cares for one another. We must remember that it’s always the people who build the business; everything is derived from them and how we treat one another. Your talents, energy, and relentless pursuit of excellence are what keep me going. For the rest of the week, I’m going to spend time thanking those departing and enabling their success while helping our remaining teams organize quickly from this change. Next week and thereafter, we’ll talk about the business.
Tony
“Today, we are reducing our corporate headcount by approximately 1250 people and saying goodbye to many talented teammates. If you are among those impacted, I am truly sorry and I apologize to have some of you wake up to this news as opposed to reading it during more normal hours,” said Tony Xu, CEO DoorDash.
The company also mentioned that it will offer 17 weeks of severance to the impacted employees and the health care support will continue till March 2023. The company further added that the termination date will be March 1 for overseas employees or visa-sponsored employees.
Read the complete message here
This is the most difficult change to DoorDash that I’ve had to announce in our almost 10-year history. Today, we are reducing our corporate headcount by approximately 1250 people and saying goodbye to many talented teammates. If you are among those impacted, I am truly sorry and I apologize to have some of you wake up to this news as opposed to reading it during more normal hours.
I know that for many of you, today’s news will come as a shock, especially because our business remains strong and continues to grow. That is why I think it is important that I explain how I arrived at this decision, what we are doing for those departing DoorDash, and why I’m optimistic about our future.
How We Got Here
As with all things, I want to start and discuss the factors in our control that led to today’s announcement and take accountability for this decision. Prior to COVID-19, DoorDash was actually undersized as a company. The pandemic presented sudden and unprecedented opportunities to serve the evolving needs of merchants, consumers and Dashers. We sped up our hiring to catch up with our growth and started many new businesses in response to feedback from our audiences.
Most of our investments are paying off, and while we’ve always been disciplined in how we have managed our business and operational metrics, we were not as rigorous as we should have been in managing our team growth. That’s on me. As a result, operating expenses grew quickly.
Now, let’s acknowledge the macro situation. Our business has been more resilient than other ecommerce companies, but we too are not immune to the external challenges and growth has tapered vs our pandemic growth rates. While our business continues to grow fast, given how quickly we hired, our operating expenses – if left unabated – would continue to outgrow our revenue.
I did not take this decision lightly. We have and will continue to reduce our non-headcount operating expenses,but that alone wouldn’t close the gap. This hard reality ultimately led me to make this painful decision to reduce our team size.
Support for Departing Teammates
Working at DoorDash means chasing excellence every day. Those of you who are departing chose that pursuit, and I’m grateful to each of you in helping DoorDash get to where it is today.
For those impacted, you will be receiving an email notification in the next 15 minutes on your personal devices to both your DoorDash and personal email address.
Here’s how we will support you during this difficult transition period:
Pay + RSU vest: Anyone impacted will receive 17 weeks (13 weeks + 1 four-week lump sum severance pay) of compensation, as well as your February 2023 stock vest.
Healthcare: All health benefits will continue through March 31, 2023. Thereafter, employees will be able to opt in and pay for COBRA coverage for up to 18 months.
Immigration support: We will set the termination date for March 1, 2023, giving those with visa applications (and a desire to stay in the US) as much time as possible to find a new job.
Career transition: We will create an opt-in directory for companies to reach you and offer recruiting support to help you find your next job. You are among the hardest working, most committed, operationally excellent people companies could find, and we are confident you will add value to any new organization you join.
Some of these details will differ for our teammates outside the US, and every impacted employee will receive an email with information specific to them. For the Wolt team, you’ll be hearing soon from Miki.
While there is no great way to manage this process, we strive to treat each of you with respect and integrity. Each of you who is impacted will have the opportunity to speak to a leader this week. We’ll be sending information on getting these conversations scheduled in addition to outlining other details including a process for you to say goodbye to teammates and access necessary systems to obtain information about expenses and payroll.
The Path Forward
While I want to focus today’s attention on our talented teammates who are departing, I did want to say a few words to the team that is staying and carrying the baton. While today’s news is painful, I continue to be very optimistic about our future and convinced of the importance of the role we can play in the world.
DoorDash has always been a resilient company. For the first half of our history, we were constantly cash-starved and under-resourced compared to our peers. Today, we are a market leader that is still in its early innings of becoming the defining local commerce company globally. We’ve grown from one business (our US Restaurants Marketplace) in one country, into five businesses serving 27 countries, across merchants in every category of local retail on both our Marketplace and Platform. Our business – just like the local economies we serve – has been resilient and our execution has been dynamic in the face of a global pandemic, persisting inflation, an energy crisis, recessionary demand, and a war. The runway ahead is massive and we’ve built tremendous momentum. If we can achieve our mission to grow and empower local economies around the world, not only will we prosper as a business but I also believe much good will be achieved as we create a world where millions of merchants can thrive, bringing out the best of our neighborhoods’ ethos and personalities.
Just as our mission hasn’t changed, neither has our strategy. Our business fundamentals remain strong. But as I’ve said before, what got us here won’t necessarily bring us to the next stage and we have to tailor some of our tactics. Looking ahead, we’re confident that we have reset the size and shape of our organization to match our strategic priorities. We must keep this level of discipline moving forward and act with the hunger, efficiency and creativity of the younger startup we once were while leading with the responsibility of the market leader we’ve become. One outcome from this approach is that we’ll continue to hire and add back recruiting capacity in a more targeted and rigorous way. We will discuss how we will do this together as a team and answer your questions at an All Hands later today.
Throughout the different phases of our journey, we have built a company that cares for one another. We must remember that it’s always the people who build the business; everything is derived from them and how we treat one another. Your talents, energy, and relentless pursuit of excellence are what keep me going. For the rest of the week, I’m going to spend time thanking those departing and enabling their success while helping our remaining teams organize quickly from this change. Next week and thereafter, we’ll talk about the business.
Tony
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