Shakeups, Layoffs – What’s Happening At Native Instruments?

What’s happening at Native Instruments? Over the last week, a number of sources have shared news of significant layoffs at Native Instruments. Specifically, according to sources close to the company, around 100 people were let go last Thursday – many of whom seemed to have been focused on hardware development.

While layoffs are often not directly tied to future performance of a company (in tech startups, for instance, reducing employee count is often a quick-fix to boost earnings and profit numbers), it is often an indication of the current company health.

Editor’s Note: Credit to /u/nonomomomo on Reddit who not only did an analysis of NI’s financials a month ago, but also rounded up the most recent news in a summary post yesterday.

The Layoffs

Hearing some heavy news about friends over at Native Instruments. Sending out some best wishes for everyone affected. It’s a sad day for the company and so many people. Opportunities will present themselves, you folks are excellent.

— nburdy????? (@nburdy) August 29, 2019

According to a number of our sources, the layoffs last week impacted over 100 employees – and happened with very little warning. As far as we are aware, there has never been a larger set of layoffs at the company since if was founded in 1996.

Initially, former employees started a now-deleted spreadsheet to help find new opportunities at other companies. This is similar to what happened after a series of layoffs at Uber in early August, when a former employee made a spreadsheet to connect freshly-unemployed engineers to recruiters at other companies.

According to posts on Native Instuments’ forums (that were based on the spreadsheet’s initial data), reddit, and a fascinating-but-unconfirmed comment on Digital Music News, many of the folks who were let go had to do with hardware.

Former Employees Are Not Happy

You can take social job review sites with a grain of salt, but generally Glassdoor is a great way to get a snapshot of company culture, leadership challenges, internal struggles, and major complaints of former employees. On Glassdoor, Native Instruments seems to generally be getting dragged through the dirt in the reviews section.

Getting a bunch of negative employee reviews is somewhat to be expected after a major round of layoffs – but many of the reviews (even positive ones) seems to site major disconnect between management/leadership and the actual users and passionate employees. Here’s a small selection:

• “Management constantly changing their mind and not listening to users. Passion slowly drains away after a tidal wave of bad management decisions”
• “C-level seems to be totally disconnected to their skilled employees, the products the company sells, the market and the customers. They seem to live in a phantasy world that doesn´t relate to reality anymore. ”
• “Almost everyone in middle management and upwards seem quite apathetic or have just lost the understanding of what made NI work well in the past and what they’re capable of doing in the present […]
  – No vision for innovative technology anymore
  – No real investment in modernizing their most popular and grossing platforms
  – Confused, self-conflicting management, that leads to…
  – Endless shifting of goals and moving targets”
• “Indecisive c-level management. New projects get cancelled last minute resulting in massive layoffs (3 in the past year!). People are quitting in hoards resulting in a very serious brain drain. Global headcount reduced to around 400 from a high of 650.”

A Potential Hiring Freeze? 

This probably isn’t too much of a surprise by this point in the article, but it also seems like NI has put a hold on any recruitment and hiring for the time being. The Careers section of their website is completely empty, as is the section of their LinkedIn page where jobs are usually posted. 

We generally keep a pretty good watch on these pages (it helps speculate about what the companies are up to next). Suffice to say that for there to be no jobs listed is incredibly abnormal.

Didn’t They Just Get An Investor?

Yes, in October 2017 there was a big financial boost to Native Instruments as they secured a large $59 million investment. But that type of money can go very quickly when developing products and hiring employees.

What Will Happen Next?

There’s no clarifying statement from Native Instruments about what the layoffs mean for the future of the company – but they have replied to some of the Glassdoor reviews with a pretty generic statement:

“We appreciate your feedback and we realize it is a difficult time of change at Native. Parting ways with our colleagues has been the most difficult part of our transformation, but we had to make some structural changes in order to be able to execute on the new vision.”

A number of commentaries on the layoffs seem to align these decisions with a potential sale. Lower expenses and higher profits demand a much higher price when shopping around a company. But there’s no way to know for sure – often sales are only announced far after they’ve been signed, sealed, and delivered.

We’ve reached out to Native Instruments for a comment on what’s happening and what users can expect – but they typically prefer to stay quiet on these types of topics.