Linden Lab Makes Workforce Reduction Layoffs Impacting 12, Says Source; UPDATE: Linden Lab Confirms "Minor Team Reorganizations"

UPDATE, 4:35pm: A Linden Lab spokesperson passed along this statement: "[W]e have not had major layoffs.  As with all companies, occasionally at Linden there are minor team reorganizations to optimize things internally." 

A highly reliable source tells me Linden Lab recently made workforce staff reductions. This may or not be related to a former Linden staffer on Glass Door claiming "Massive layoffs, but got rid of the wrong people" last week. According to my source, however, this most recent layoff impacted about a dozen employees: "It was like one person from each department, totaling 12, I believe," my source tells me. "I think it's mostly shared staff -- web stuff, IT stuff, payment stuff."

Linden Lab has about 200+ employees, so this would be a relatively modest work staff reduction. (I have, of course, asked Linden Lab for comments on this report and will update this post when and if they reply.) Contrast, for instance, with the 2010 layoff which cut 30% of Linden Lab staff.

In any case, it's still a noteworthy reduction, pointing to two likely factors:

• While Linden Lab's Second Life is still quite profitable, grossing an estimated $60-75 million a year, its core revenue stream of private virtual regions has been slowly but steadily eroding year after year, and hasn't been adequately replaced by recurring Premium subscriptions.
• While Sansar has seen some impressive partnerships and user-made content in its "creator beta" phase, it's also seen little organic growth of users. And because it's architected primarily as a platform for full VR rigs from Oculus and Vive, sales of those have been incredibly slow. So it's unlikely Sansar will see strong user growth until it launches non-VR clients for Mac, PC, and mobile, and those integrate well with the VR experience. (A key secret to the relative success of VRChat.)

In either case, the company is facing slow growth in future revenue and steadily waning current revenue, so it makes sense to slice off some payroll to stay quite profitable. Fortunately for the dozen or so former Linden Lab employees, Silicon Valley is mostly on a hiring binge, and Linden Lab's stellar brand should quickly get them well-paying gigs elsewhere.

Pictured: File photo of Linden Lab's HQ in San Francisco.

Comments

[Clara Seller]

Just some minor reorganizations and a wee bit of water bailing.

Near, far, wherever you are
I believe that the heart does go on...

Ebbe, I think I can see the masses sailing toward Sansar. They're right out there, just beyond the horizon. Susan, can you see them too?

[willard]

"Man, the BS piled up so high you needed wings to stay above it." -Capt. Wilard

[Fart Mclinden]

They have been cracking down on customers too.. firing them left and right for having a voice on the forum with info the lab wants swept under the rug..occasionally at Second Life there are minor customer reorganizations to optimize things socially."

[CM Ralph]

I suspect the ongoing sustained Denial of Service attacks that began yesterday on LL SL servers is a direct result of this lay-off.

[Vivivenne]

Still ongoing attack. Worst since years. I wonder whom LL cut off some important ego bits.