After DigitalOcean appointed a new CEO and CFO last summer, the cloud infrastructure provider is starting a more extensive restructuring: The startup has announced a round of layoffs, which may affect 30 to 50 people.
DigitalOcean confirmed the message with the following statement:
“ DigitalOcean recently announced a restructuring to better align its teams with its forward-looking growth strategy. Unfortunately, some roles were removed in the course of this restructuring. DigitalOcean continues to be a fast-growing company with $ 275 million in [annual recurring revenues] and more than 500,000 customers worldwide. With this new organizational structure, we are able to accelerate profitable growth by continuing to serve developers and entrepreneurs around the world. "
A number of traces emerged this morning when the layoffs first arrived last night People on Twitter are talking about it, some are announcing that they are looking for new opportunities search, and some offer help for victims . Our inbound tips estimate the incisions at 30 to 50 people. With around 500 employees (an estimate on PitchBook) that would make up up to 10% of the employees affected.
It's not clear what's going on here – we'll update as soon as we hear more – but when Yancey Spruill and Bill Sorenson were appointed CEO and CFO in July 2019 (Spruill replaced someone who was only for one Year was in the role). The new CEO made a brief statement, which in retrospect indicated an early realignment of the future.
"My goal is to continue to offer everything you love about DO, but also to improve our offer in a way that is meaningful, strategic and most helpful to you over time," he said Time .
The company offers developers a range of cloud infrastructure services, including scalable computing services (“droplets” in DigitalOcean terminology), managed Kubernetes clusters, object storage, managed database services, cloud firewalls, load balancers and more data centers worldwide. The company works with more than 1 million developers in 195 countries. It also extends the services it offers to developers, including further improvements to managed database services and a free hosting option for ongoing code testing in collaboration with GitLab. He has been named the youngest CEO, although developers are generally satisfied with the company, it is not as excited today as it used to be and a smaller player.
And in a business where economies of scale are critical With good margins in a company, it competes against some of the greatest tech experts: Google (and its Google Cloud Platform), Amazon (as AWS) and Microsoft (with Azure). That could mean that DigitalOcean is either limiting the offer while addressing investors for a new round. or to save money better when it comes to how best to play against these bigger players with big pockets; or maybe to think about another exit.
In this context, it is noteworthy that last summer the company not only appointed a new CFO, but also a CEO with experience as a CFO. It's been a while since DigitalOcean raised capital. According to PitchBook, DigitalOcean last raised money in 2017, an undisclosed amount from Mighty Capital, Glean Capital, Viaduct Ventures, Black River Ventures, Hanaco Venture Capital, Torch Capital and EG Capital Advisors. Before that, $ 130 million in debt was raised in 2016. A total of $ 198 million was raised, and the last valuation was from a round in 2015 of $ 683 million.
We will update this post as we learn more. Greetings to those affected.