21st century tech is a wonderful thing for early stage investors and – sometimes – consumers but it seems to becoming increasingly difficult to make money out of it.
Ride hailing giant Uber is laying off 400 of its 1200 global marketing team to try to turn around eye-watering losses of $1bn on $3.1bn revenue and gross sales of $14.6bn. You might deduce from these numbers that marketing has been doing its job and some other bits have been losing the money.
Uber says its going to make its marketing “more centralised.” CEO Dara Khosrowshahi (below) says: “Today there’s a general sense that while we’ve grown fast, we’ve slowed down. You can see it in Pulse Survey feedback and All Hands questions, and you can feel it in much of our day-to-day work. This happens naturally as companies get bigger, but it is something we need to address, and quickly.”
In the early days of this wave of giant tech companies it looked as though the likes of Google and Facebook could defy gravity by hiring as many people as they liked, with free meals and all the rest of it, and employ hundreds of people in non-mainstream activities like driverless cars.
Latecomers to the tech party, like Uber, are finding that it’s a bit different. How long before reality bites at Google and Facebook?