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Labor trends in 2023: Over-employment, fatigue and hope




elcome to Startups Weekly, a nuanced take on this week’s startup news and trends by Senior Reporter and Equity co-host Natasha Mascarenhas. To get this in your inbox, subscribe here.

If there’s one thing I can rely on every new year, it is that people will debate whether resolutions are an irrelevant, capitalistic waste of time, or if there’s something beautiful about the world collectively wanting to better themselves.

Longtime readers know that I’m a fan of resolutions because of the latter. There’s nothing quite like the renewed energy you get from a few days off, ready to be focused on better, bigger goals that 2022 just didn’t have room for. Am I re-energized after two weeks off? Yes. Am I worried that the news cycle will begin to spiral out of control within moments, taking us and our hot takes with it? Also, yes.

Alas, that’s where we are and if you have a resolution, I’m cheering for you. My journalistic one, beyond working more on my writing craft and perhaps getting started on this book dream I’ve had forever, is to do more follow-up stories.

The big themes that dominated 2022 news coverage were around layoffs, labor and venture capital incentives. But beyond singular workforce reductions, how has the reality check changed the way tech works? Are venture dollars getting more disciplined or was that just a fever tweet of the past 12 months? Doom and gloom is part of the story, always, but I think there’s also news to be found in the reinvention and reframing of tech.

So far, if I do say so myself, I’m not doing half bad. This week, I published a story looking into how laid-off talent is rethinking risk in today’s job market. Here’s the intro:

Tech isn’t as collegial as it used to be. Rocket ships are being unveiled as sputtering messes, mission-driven startups don’t feel so mission oriented when responding to investor pressure, and widespread layoffs offer a loud reminder that jobs are breakable contracts not sacrosanct vows.

Over the past few months, thousands of employees from Meta, Twitter, Stripe, Amazon, DoorDash and countless other companies that don’t have the privilege of being household names are back on the job market. A job market that includes hiring freezes, salary cuts and a general malaise that industry experts warn won’t be over this year.

So where does tech’s talent go from here?

The answer is complicated, and it’s too early to have definitive labor data. VCs want to fund the newest tech mafia startups before banks do, top MBA programs want laid-off workers to join so badly that they’re waiving standardized test score requirements, and the tech companies that are in a position to hire really want you to know it.

Keep reading to see how three laid-off employees are approaching their careers differently in 2023. As always, you can find me on Twitter, Substack and Instagram, where I publish more of my words and work. In the rest of this newsletter, we’ll talk about CES, crypto and Katrina Lake’s return as Stitch Fix CEO.

What you CES at Vegas, hopefully doesn’t stay in Vegas

It’s that time of the year. This week brought CES, the annual consumer electronics show that features a slew of creative gadgets likely to surprise. TechCrunch is on the ground covering these products as they debut, which range from texts from your dog to not-so-dorky AR glasses and “a stylish hiding spot for your unmentionables.”

Here’s why this is important: CES is starting to take robotics more seriously, according to TC’s hardware editor Brian Heater. In his newsletter, Actuator, Heater gave us early impressions of the show, which is less of a spectacle compared to its pre-pandemic days.

Here’s why he thinks there were more robots roaming around Vegas this past week:

  • The pandemic has accelerated the industry in general.

  • Automakers are getting serious about investing in and acquiring robotics startups or building these technologies in-house. See: Ford’s Agility investments, TRI’s research and Hyundai’s events post-Boston Dynamics acquisition.

  • Big firms like Amazon have been aggressively pushing consumer robotics.

CES 2023 TechCrunch coverage logo

Image Credits: TechCrunch

The latest in crypto

I’ll be honest, this subhed sounds like a mandatory groan meets not-so-subtle hangover. I know you’re not interested, or really helped by, a listicle of all the crypto stories you may have missed while you were enjoying eggnog or catching up on books. Link roundups, even though they are at the end of this newsletter, only do so much!

Here’s why it’s important: We can’t just shrug off what happened in the final innings of 2022 and let fatigue win! So, let’s make a deal. I’m going to throw you to my brilliant colleague Jacquelyn Melinek’s newsletter, Chain Reaction, for the latest and greatest about what’s happening in the world of crypto. Her latest column certainly made me wake up: “Crypto is ringing in the New Year with new lawsuits and new chaos.” 

Close up of transparent bitcoin sign standing on golden digital surface surrounded by wire network.

Image Credits: Andriy Onufriyenko / Getty Images

Stitch Fix up

While we often cover executive departures, it’s not every day that you see a founder return to their company as chief executive a year and a half after stepping down. Gold star if you guess who I’m talking about: Stitch Fix founder Katrina Lake is returning to the company she began as it struggles through the downturn.

Here’s why it’s important: Now that Lake is chief executive again, she is the bearer of bad news. As first reported by CNBC, Lake sent a companywide email to 1,700 salaried employees, indicating that 20% of them are getting cut.

As I spoke about on our latest episode of Equity, it’s clear that the 2022 tech layoff spree isn’t a wave anymore, it’s a reality. Just take a look at other headlines from this week:

Image Credits: Getty Images under a David Paul Morris/Bloomberg license.

A few notes

  • If you’re feeling nostalgic, here’s some of our 2022 year-end coverage
  • TechCrunch is coming to Boston on April 20. I’ll be there with my favorite colleagues to interview top experts at a one-day founder summit. Book your pass ASAP! 

Seen on TechCrunch

Two CEOs is better than one with Henrique Dubugras from Brex

There’s now an open source alternative to ChatGPT, but good luck running it

India set an ‘incredibly important precedent’ by banning TikTok, FCC Commissioner says

Doorstead closes on $21.5M to make sure you always have a tenant for your rental property

Remember how this whole working thing works?

Seen on TechCrunch+

Will record levels of dry powder trigger a delayed explosion of startup investment?

Black founders still raised just 1% of all VC funds in 2022

How global unrest will impact innovation in 2023

The year customer experience died

Toyota stumbled as Hyundai was stealing the successful Prius playbook

Whoops! Is generative AI already becoming a bubble?

With that, I am off to Baltimore to spend some time with some of my dearest childhood friends. If you have any coffee shop recommendations, send them my way! Otherwise, I’ll catch you next week.




Tesla more than tripled its Austin gigafactory workforce in 2022



Tesla’s 2,500-acre manufacturing hub in Austin, Texas tripled its workforce last year, according to the company’s annual compliance report filed with county officials. Bloomberg first reported on the news.

The report filed with Travis County’s Economic Development Program shows that Tesla increased its Austin workforce from just 3,523 contingent and permanent employees in 2021 to 12,277 by the end of 2022. Bloomberg reports that just over half of Tesla’s workers reside in the county, with the average full-time employee earning a salary of at least $47,147. Outside of Tesla’s factory, the average salary of an Austin worker is $68,060, according to data from ZipRecruiter.

TechCrunch was unable to acquire a copy of the report, so it’s not clear if those workers are all full-time. If they are, Tesla has hired a far cry more full-time employees than it is contracted to do. According to the agreement between Tesla and Travis County, the company is obligated to create 5,001 new full-time jobs over the next four years.

The contract also states that Tesla must invest about $1.1 billion in the county over the next five years. Tesla’s compliance report shows that the automaker last year invested $5.81 billion in Gigafactory Texas, which officially launched a year ago at a “Cyber Rodeo” event. In January, Tesla notified regulators that it plans to invest another $770 million into an expansion of the factory to include a battery cell testing site and cathode and drive unit manufacturing site. With that investment will come more jobs.

Tesla’s choice to move its headquarters to Texas and build a gigafactory there has helped the state lead the nation in job growth. The automaker builds its Model Y crossover there and plans to build its Cybertruck in Texas, as well. Giga Texas will also be a model for sustainable manufacturing, CEO Elon Musk has said. Last year, Tesla completed the first phase of what will become “the largest rooftop solar installation in the world,” according to the report, per Bloomberg. Tesla has begun on the second phase of installation, but already there are reports of being able to see the rooftop from space. The goal is to generate 27 megawatts of power.

Musk has also promised to turn the site into an “ecological paradise,” complete with a boardwalk and a hiking/biking trail that will open to the public. There haven’t been many updates on that front, and locals have been concerned that the site is actually more of an environmental nightmare that has led to noise and water pollution. The site, located at the intersection of State Highway 130 and Harold Green Road, east of Austin, is along the Colorado River and could create a climate catastrophe if the river overflows.

The site of Tesla’s gigafactory has also historically been the home of low-income households and has a large population of Spanish-speaking residents. It’s not clear if the jobs at the factory reflect the demographic population of the community in which it resides.

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Launch startup Stoke Space rolls out software tool for complex hardware development



Stoke Space, a company that’s developing a fully reusable rocket, has unveiled a new tool to let hardware companies track the design, testing and integration of parts. The new tool, Fusion, is targeting an unsexy but essential aspect of the hardware workflow.

It’s a solution born out of “ubiquitous pain in the industry,” Stoke CEO Andy Lapsa said in a recent interview. The current parts tracking status quo is marked by cumbersome, balkanized solutions built on piles of paperwork and spreadsheets. Many of the existing tools are not optimized “for boots on the ground,” but for finance or procurement teams, or even the C-suite, Lapsa explained.

In contrast, Fusion is designed to optimize simple inventory transactions and parts organization, and it will continue to track parts through their lifespan: as they are built into larger assemblies and go through testing. In an extreme example, such as hardware failures, Fusion will help teams connect anomalous data to the exact serial numbers of the parts involved.

Image credit: Stoke Space

“If you think about aerospace in general, there’s a need and a desire to be able to understand the part pedigree of every single part number and serial number that’s in an assembly,” Lapsa said. “So not only do you understand the configuration, you understand the history of all of those parts dating back to forever.”

While Lapsa clarified that Fusion is the result of an organic in-house need for better parts management – designing a fully reusable rocket is complicated, after all – turning it into a sell-able product was a decision that the Stoke team made early on. It’s a notable example of a rocket startup generating pathways for revenue while their vehicle is still under development.

Fusion offers particular relevance to startups. Many existing tools are designed for production runs – not the fast-moving research and development environment that many hardware startups find themselves, Lapsa added. In these environments, speed and accuracy are paramount.

Brent Bradbury, Stoke’s head of software, echoed these comments.

“The parts are changing, the people are changing, the processes are changing,” he said. “This lets us capture all that as it happens without a whole lot of extra work.”

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Amid a boom in AI accelerators, a UC Berkeley-focused outfit, House Fund, swings open its doors



Companies at the forefront of AI would naturally like to stay at the forefront, so it’s no surprise they want to stay close to smaller startups that are putting some of their newest advancements to work.

Last month, for example, Neo, a startup accelerator founded by Silicon Valley investor Ali Partovi, announced that OpenAI and Microsoft have offered to provide free software and advice to companies in a new track focused on artificial intelligence.

Now, another Bay Area outfit — House Fund, which invests in startups with ties to UC Berkeley — says it is launching an AI accelerator and that, similarly, OpenAI, Microsoft, Databricks, and Google’s Gradient Ventures are offering participating startups free and early access to tech from their companies, along with mentorship from top AI founders and executives at these companies.

We talked with House Fund founder Jeremy Fiance over the weekend to get a bit more color about the program, which will replace a broader-based accelerator program House Fund has run and whose alums include an additive manufacturing software company, Dyndrite, and the managed app development platform Chowbotics, whose most recent round in January brought the company’s total funding to more than $60 million.

For founders interested in learning more, the new AI accelerator program runs for two months, kicking off in early July and ending in early September. Six or so companies will be accepted, with the early application deadline coming up next week on April 13th. (The final application deadline is on June 1.) As for the time commitment involved across those two months, every startup could have a different experience, says Fiance. “We’re there when you need us, and we’re good at staying out of the way.”

There will be the requisite kickoff retreat to spark the program and founders to get to know one another. Candidates who are accepted will also have access to some of UC Berkeley’s renowned AI professors, including Michael Jordan, Ion Stoica, and Trevor Darrell. And they can opt into dinners and events in collaboration with these various constituents.

As for some of the financial dynamics, every startup that goes through the program will receive a $1 million investment on a $10 million post-money SAFE note. Importantly, too, as with the House Fund’s venture dollars, its AI accelerator is seeking startups that have at least one Berkeley-affiliated founder on the co-founding team. That includes alumni, faculty, PhDs, postdocs, staff, students, dropouts, and other affiliates.

There is no demo day. Instead, says Fiance, founders will receive “directed, personal introductions” to the VCs who best fit with their startups.

Given the buzz over AI, the new program could supercharge House Fund, the venture organization, which is already growing fast. Fiance launched it in 2016 with just $6 million and it now manages $300 million in assets, including on behalf of Berkeley Endowment Management Company and the University of California.

At the same time, the competition out there is fierce and growing more so by the day.

Though OpenAI has offered to partner with House Fund, for example, the San Francisco-based company announced its own accelerator back in November. Called Converge, the cohort was to be made up of 10 or so founders who received $1 million each and admission to five weeks of office hours, workshops and other events that ended and that received their funding from the OpenAI Startup Fund.

Y Combinator, the biggest accelerator in the world, is also oozing with AI startups right now, all of them part of a winter class that will be talking directly with investors this week via demo days that are taking place tomorrow, April 5th, and on Thursday.

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