The Billionaires F*cked Up by@sheharyarkhan
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The Billionaires F*cked Up

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The past week was dominated by news of crypto crash and mass layoffs. It started with Facebook parent Meta announcing a headcount reduction of 11,000, followed by news that FTX, the world's second largest crypto exchange, had collapsed. Meanwhile, Elon Musk found out why charging money in exchange for the Twitter verified checkmark was a dumb AF idea.

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Look, we don't know why Zuckerberg thought he could sell everyone on the idea of buying an expensive headset to play a video game that lacks the polish and bluster of other VR titles despite costing literally billions of dollars more than everything else on the market, but here we are. Zuck f*cked up, and he admitted as much when he announced that Facebook parent Meta would be reducing its headcount by 13% and letting go of over 11,000 people in one of the largest layoffs in the tech sector this year and the first ever in the company's 18-year history.

At this point, the 'why' has become a tale as old as time. Basically, back in the not-so-distant year of 2020, an infectious disease termed COVID-19 (but called the 'Chinese virus' by then U.S. President Donald Trump) prompted health authorities to recommend that everyone, and we mean, everyone, stay inside to contain its spread. This lockdown resulted in a period of e-commerce growth the likes of which had never been seen before. Understandably, tech companies went nuts and began to hire more employees to keep up with a surge in demand for their products or services.

But here's where they f*cked up: they assumed that this honeymoon period will continue. Plot twist: it didn't, and now that the COVID-19 pandemic is over, demand is returning to pre-pandemic levels and tech companies no longer want to keep paying for all the extra employees they hired during the lockdown. "I got this wrong, and I take responsibility for that," Zuck wrote to employees in a message telling them they were being let go.

Some of Zuck's problems are out of his control, like the looming recession in the U.S., but are exacerbated by issues such as Apple's decision to allow users to opt-out of data tracking and a less-than-stellar response by investors to Zuckerberg's decision to go all-in on the metaverse. Despite having failed so spectacularly at driving mass adoption for a technology that is likely going to be a precursor to The Matrix, Zuck wants to keep throwing money at the problem in hopes that someday it'll yield the results he's expecting.

Facebook continues to dominate HackerNoon's tech company rankings, remaining at the #1 spot. Its parent Meta was trending #14, while Apple was trending #7.

FTX's Downfall Proves Tech Bros Are Just Petty Billionaires With Inflated Egos 💸💸💸

Hatred. Jealousy. And Backstabbings. That's how the internet characterizes the relationship between billionaires Changpeng Zhao (or 'CZ') and Sam Bankman-Fried (or 'SBF'), who, for years, competed as the heads of the two largest crypto exchanges in the world: Binance and FTX.

By all accounts, the two billionaires (and their respective crypto exchanges) were stark opposites of each other and largely remained aloof, but everything changed last week when SBF decided to take a dig at CZ, presumably because of the latter's involvement in helping Elon Musk buy Twitter (at least, according to this Redditor). What happened next puts the politicking from Succession to shame. For one reason or the other, CZ, (either intentionally or unintentionally), decided he was gonna have none of it and started making moves that ultimately resulted in FTX declaring bankruptcy and SBF losing most, if not all, of his net worth.

The tl;dr version is CZ decided to liquidate the entirety of Binance's previously-received holdings in FTT, a token backed by FTX, following a damning story by CoinDesk that raised questions about FTX's liquidity (the timing of the CoinDesk story is highly suspicious given that it came just days after SBF's now-deleted tweet mocking CZ). This rattled markets because CZ's decision would ultimately cause the value of FTT to drop (which is exactly what happened). As FTX struggled to pay investors who were exiting their positions in FTT, Binance entered a non-binding agreement to buy FTX only to cancel it a day later causing even further chaos. FTX ultimately filed for bankruptcy and things have been going downhill for SBF ever since.

All of this to say, a tweet that SBF shouldn't have made and CZ could have probably ignored resulted in a winner-takes-all bloodbath that leaves Binance as the largest crypto exchange in the world and CZ a tech entrepreneur not to be trifled with. Also, a reminder, that you can trick the media into saying whatever you want them to if you're filthy rich and venture capitalists will throw money at literally anything if it's eccentric enough.

Binance was trending #8 on HackerNoon's tech company rankings.

The 'Bird' Just Hit a Tree🎋

When Elon Musk acquired Twitter, he infamously tweeted 'the bird is freed.' What he actually freed was far worse, at least, for him. Having been forced to pay a whopping $44 billion for Twitter (more than its actual worth), the world's richest man was hard at work trying to get the remaining employees at the company to do the dirty work for him while he ordered one chaotic product launch after the next (though this reinvention guru thinks Musk is taking a page from the classic reinvention playbook).

Having rolled out a plan to sell the verified blue check mark for nearly $8 a month, Musk soon found out why this was a bad idea. The internet, by virtue of being the internet, decided that $8 was a nominal amount to pay for the ability to sh*tpost. And sh*tpost they did, forcing at least one big brand (Eli Lilly) to issue an apology for a tweet posted by an impersonator. This does not bode well for Twitter, especially if Musk wants brands to advertise on the platform.

Throughout all of this, Twitter's valuation has plummeted and Musk has raised the specter of bankruptcy (though Bloomberg thinks it's a bit premature to think Twitter would go bankrupt, Musk's comments be damned).

Meanwhile, Musk is close to having lost nearly as much of his net worth this year as Mark Zuckerberg, but continues to remain the world's richest person (unlike Zuckerberg), according to Bloomberg's Billionaire Index.

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Twitter was trending #53 on HackerNoon's Tech Company Rankings.

In Other News..📰

  • Everyone's favorite multimedia company Walt Disney Co. has paused hiring, following in the footsteps of corporate America as it navigates a downturn in the economy.
  • Billionaire Jeff Bezo's Amazon, which ranked #15 this week, is no longer valued at over a trillion dollars.
  • Netflix, ranked #45, is said to be exploring investing in live sports.

So, who do you think did it worse this past week? Let us know here. This has been the tech company brief, and you were reading Issue #24! See y’all next week. PEACE ☮️

— Sheharyar Khan, Editor, Business Tech @ HackerNoon

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