The popular online website for arranging or offering lodging, primarily homestays, or tourism experiences Airbnb has announced that they will begin to reduce the amount of workers they employ.
In a note from Airbnb co-founder and CEO Brian Chesky to employees, Brian tells staff they are making plans to reduce the workforce.
"For a company like us whose mission is centered around belonging, this is incredibly difficult to confront, and it will be even harder for those who have to leave Airbnb," he says in the note.
Brian says Airbnb's business has been hit hard. Revenue for this year is forecasted to be less than half what the company earned in 2019. To combat this, Airbnb raised $2billion in capital and started cutting costs.
"While we know Airbnb’s business will fully recover, the changes it will undergo are not temporary or short-lived. Because of this, we need to make more fundamental changes to Airbnb by reducing the size of our workforce around a more focused business strategy," says Brian.
"Out of our 7500 Airbnb employees, nearly 1900 teammates will have to leave Airbnb, comprising around 25 per cent of our company. Since we cannot afford to do everything that we used to, these cuts had to be mapped to a more focused business."
Brian says Airbnb will also be scaling back projects including transportation and Airbnb studios and will scale back investments in hotels and lux.
"Teams across all of Airbnb will be impacted. Many teams will be reduced in size based on how well they map to where Airbnb is headed.
"We assessed how each team mapped to our new strategy, and we determined the size and shape of each team going forward. We then did a comprehensive review of every team member and made decisions based on critical skills, and how well those skills matched our future business needs."
Brian says severance packages will be available, equity packages will be altered to reflect the situation and Airbnb will continue to cover healthcare for a period of time.
"Employees in the US will receive 14 weeks of base pay, plus one additional week for every year at Airbnb. Tenure will be rounded to the nearest year. Outside the US, all employees will receive at least 14 weeks of pay, plus tenure increases consistent with their country-specific practices.
"We are dropping the one-year cliff on equity for everyone we’ve hired in the past year so that everyone departing, regardless of how long they have been here, is a shareholder. Additionally, everyone leaving is eligible for the May 25 vesting date," he says.
"In the US, we will cover 12 months of health insurance through COBRA. In all other countries, we will cover health insurance costs through the end of 2020. This is because we’re either legally unable to continue coverage, or our current plans will not allow for an extension. We will also provide four months of mental health support through KonTerra."
Brian says there will also be assistance given to employees who will be looking for new jobs.
"We will be launching a public-facing website to help teammates leaving find new jobs, we are offering four months of career services through RiseSmart, a company that specializes in career transition and job placement services and a computer is an important tool to find new work, so we are allowing everyone leaving to keep their Apple laptops."
Employees leaving in the US and Canada will have last day will be Monday, May 11. Other regions are still be neogotiated.
