By Rolfe Winkler
The motto for Silicon Valley startups was often “Move fast and break things.” Now it’s “Cut fast and cut deep.”
Francis Davidson’s biggest challenge last year at his short-term apartment-rental website, Sonder Inc., was fending off a dozen new rivals fueled by a flood of investor capital. It wasn’t the worst problem a 27-year-old could have, as he ran a startup valued at $1 billion.
Today, the economic impact of coronavirus has cut April sales by at least half, while fixed costs remain. His job is negotiating lease concessions, refusing refund requests and axing a third of his staff. One of the hardest tasks was letting go a recruiter who last year lost his infant son.
“This is the most insane thing I’ve faced in my career,” Mr. Davidson said. “I started this company when I was 19. I’ve never seen a recession.”