I started Optimizely six years ago with my co-founder, Pete Koomen, to achieve a simple goal: make it easy for anyone in the world to do website A/B testing. This goal was inspired by my work on the Obama 2008 campaign, and in 2012 we achieved this goal when we surpassed Adobe to become the #1 most-adopted website optimization platform in the world.
Fueled by the growth of our customer base we doubled our revenue every year for the first five years of our existence. This growth has attracted over $146m in venture capital from Benchmark Capital, Andreessen Horowitz, and Index Ventures. Our last round of funding closed a few months ago, and in the announcement I made it clear that we are focused on the long term, on building an impactful and enduring company that enables the world to turn data into action. That is why in August of 2015 we embraced the goal of Controlling Our Own Destiny, which means controlling the path we are on as a company without having to depend on anyone but ourselves. More specifically, this means putting Optimizely on a path to sustained growth and profitability without big infusions of additional venture capital.
So, today we will accelerate our journey to Controlling Our Own Destiny by undertaking some important structural changes to the business, including a 10% reduction in our workforce. Without a doubt, the decision to reduce our costs and focus even more sharply on creating value for our customers and, in turn, earning more revenue from them is the right one for the business. That said, today’s action involves people who have contributed meaningfully to our journey, and I am truly sad to see them move on.
The reason why I’m sharing this decision publicly is because one of the most important cultural values we have at Optimizely is transparency. I believe being transparent with our customers, partners, and with all our employees (who we refer to as Optinauts) is essential to building trust.
Below I’ve included the full content of an email I sent our company earlier today. I decided to share it in its entirety in order to give those who are interested every opportunity to understand the decisions we’ve made, as well as why and how we’ve made them. I also decided to share this publicly because I care deeply about the individuals affected and believe the world should know that this decision was driven by factors outside their control and shouldn’t be viewed as a reflection of their performance. Each and every one of them will be sorely missed.
From: Dan Siroker
Subject: Accelerating Our Journey to Controlling Our Own Destiny
This morning we will inform 40 Optinauts, representing 10% of our team, that they will not be continuing with us on our journey. The decision to part ways with these individuals was driven by factors outside their control and shouldn’t be viewed as a reflection of their performance. Quite the contrary, we would not be where we are today without the contributions of these Optinauts. We owe them our gratitude, and I am committed to doing everything in my power to ensure their success in the next step of their journey.
While it is sad to see fellow Optinauts move on, it is the right thing to do for Optimizely in order for us to accelerate our journey to Controlling Our Own Destiny. I want to live up to our cultural value of transparency and share with you why and how we made this decision.
In August 2015, we began our journey to Control Our Own Destiny, which means controlling the path we are on as a company without having to depend on anyone but ourselves. In order to do that we must build a business that makes more money than it spends. We set a goal of getting to cash flow breakeven and we have made tremendous progress toward this goal. Over the last six months we have collectively saved over $1.4M by more wisely investing our resources and we have also become more productive as measured by the revenue per Optinaut, which has grown 26%.
I’m incredibly thankful we embraced this journey in August because on February 5th, our entire industry got a wake up call. On that day, public cloud companies collectively lost $28B in market value on a single day. Some of the market value has recovered since then, but the market has clearly shifted. In fact, the market has validated the approach we adopted in August by valuing sustainable businesses.
Given this new reality, over the last month and a half we worked hard to determine the best path toward Controlling Our Own Destiny. We considered all our options and ultimately it became clear that we were over-invested in some parts of the business. Given that employee-related costs are our greatest expense, we went through a very rigorous and meticulous process to comprehensively review every role and determine whether that role is essential to our journey at this time. Through this process we identified 40 individuals across all departments who will not continue with us. All 40 individuals will be notified this morning, and today will be their last day.
I know many of you will leave today with a heavy heart — I know I will. It will take time for us to mend, and that’s OK. In order to help us heal, tomorrow morning I will present my case for why all of us who remain should recommit to our journey. I will bring our Three Year Ambition to life and show you what it means for us to Become Essential to our customers. I will show you what it means to take the next step towards enabling the world to turn data into action.
Per aspera ad astra,