Jason M. Lemkin discusses how post-venture-round companies became much more operationally efficient by freezing hiring and cutting marketing spend. He argues hiring freezes over two years act like implicit layoffs—reducing headcount relative to growth—and that sales and marketing efficiency are at unusually high levels entering 2024.
Everyone got so efficient, they got so fit, and they cut all marketing spend and they froze hiring. Right? There was a lot of PR about layoffs, but layoffs are a much smaller story than just freezing hiring. Freezing hiring for two years is essentially sort of like a layoff, right? If you grow 50% in over two years and headcount's flat, then you basically didn't hire that extra 50% of people. And so what happened was this weird world where sales and marketing efficiency cat were at the lowest tax, are at the highest they've been in my lifetime as a founder that we know of. We're in a tough world in 2024, which is we all got fit, we all got efficient. We all, we all made those venture rounds stretch, right? If they're not going under, they. They figured out how to at least grow a little bit with half the head count.
