Evan J. Zimmerman
Contributor
Evan J. Zimmerman is the founder and CEO of Drift, a genomics software company, and chairman of Jovono, a venture capital firm.
More posts by this contributor
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Since January 2022, Glossier has laid off about 80 employees (or a third of its corporate workforce), most of whom were on its tech team.
Although the company focused on technology when it was really a beauty business, it is not hard to see these layoffs in the light of the public market tech meltdown.
Many venture-backed companies believe they are tech companies — indeed, they were born that way — when in fact they are not. Leaders at these companies need to learn the business they are actually in, what makes those companies good, and direct their technical efforts towards those ends.
The fundamental disconnect: Software-enabled businesses don’t necessarily monetize the same way that software-based businesses do.
Technology companies get the richest valuations and are endowed with the highest multiples of any sector. Pursuing those higher multiples means going to great lengths to show, both operationally and financially, that you “look” like a tech company.
For a firm like Glossier, looking like a tech company is the difference between having a price-to-sales ratio of 5.44, like Estée Lauder, or 31.6, like MongoDB. Glossier fo …
