These are challenging times for our families, businesses, customers, and communities. Personally, it was also a challenging week as we made some tough decisions that impacted people that I care deeply about. We parted ways with 80 Sisensers, which is about 9% of our employee population.
Nobody wants to be in this situation, but I’m sharing my decision-making logic here in the hope that it helps others who find themselves in a similar position.
Letting go of our people was a painful and hard decision. It was designed to address the new COVID-19 business reality we are dealing with. In total, it’s about the same number of people we worked very hard to add in the past six months. These are the toughest decisions to make.
Having just raised $100M in January doesn’t necessarily make the decisions easier or harder because in the end it comes down to the following logic — my number one priority to our people, customers, and shareholders is to build a long-term healthy and successful business. As painful as it is, I take full responsibility for the decision. I believe it is the right thing to do in order to keep the business strong so that we can continue to grow with, and despite, COVID-19.
COVID-19 is causing extreme and almost bipolar outcomes in our industry. On one hand, companies need analytics more than ever, as agile insights are critical to data-driven decision-making in a crisis and to secure top-line revenue. On the other hand, companies in multiple segments of the economy are facing existential challenges as their entire revenue or funding has evaporated in a matter of weeks. This directly impacts dozens of our customers in hard-hit industries like travel, hospitality, retail, event management, and more. It’s slowing the overall economy, as well as our own growth, leading to a revised business plan for 2020.
About a month ago, once the economic implications of our new reality began to take shape, we moved quickly to deliver coronavirus toolkits to our 2,000 customers and launched a COVID-19 relief package offering both free software and services to customers and the global community. In the past month alone, we helped over 175 customers directly involved in the crisis and various efforts of the healthcare industry. I can’t tell you how proud I am of our team, and how proud I am to be a Sisenser.
Despite the efforts of many companies and governments to curb the Coronavirus, the economic impact is real. We are fortunate that our technology delivers value across many companies in many industries, but we are not immune to the slowing of the economy.
We ran a number of models to continue to run a healthy and growing business to see what 2020 and 2021 might look like. We anticipate continued sales and growth, but less than initially planned. The even bigger question, and the collective challenge, is how long this situation will last — 3, 6, 12, or maybe 18 months? Nobody really knows. We were conservative in our assumptions. If you want to make such a move just once, you have to plan conservatively and act decisively.
The next big decision I made was not to be dependent on any future external funds as we continue to grow. We don’t know when the IPO markets will open, and it’s crucial that we are able to continue to invest in our technology and our customers in the meantime. For this reason, our new plan allows us to keep growing and investing while also becoming cash flow positive, if needed, before the end of 2021, without any need to reduce further costs.
To achieve this, it became clear that we needed to realign expenses, especially given the massive growth and (forward-looking) investments made over the past 24 months. We did the obvious things first, addressing marketing spend, travel, new hires, offices, and more. Unfortunately this also included the need to lower our headcount and make changes to our team now in order to strengthen our business for the long term.
Our values guide us through challenging times. True to the Sisense way, we approach this sensitive time in an individual, personalized, and authentic way, never forgetting that each person has their own reality. I am incredibly grateful to all of our departing Sisensers, and each can expect to be treated with the respect they deserve for their contributions. Each person will receive at least a month of severance and more to tenured employees, extra health insurance in the U.S., and we will work with them on placement to help find new opportunities.
As we carry on, our business is now in a stronger position. We have the ability to continue forward and invest in our technology and customers without further reductions and without any reliance on outside funding or IPO timing. And as the market gets back to normal, we will emerge with a strong profile that provides optionality if we choose to be a public company, one day.
While this is no doubt the most challenging economic climate we have ever faced, I believe in:
- Our people and culture
- Our obsession with customer success
- The strength of our technology platform
- The ever-growing need for cloud analytics/AI/ML, now more than ever
- Our ability to continue to innovate and disrupt the analytics market
And I know Sisense will emerge from this challenge an even stronger industry leader than ever before!
Amir Orad is the CEO of Sisense, a successful entrepreneur and a Big Data, cybersecurity, and financial technology thought leader, with proven success in leading and scaling businesses by orders of magnitude.