Case Study: How Should a Start-Up Cut Its Burn Rate? – HBR.org Daily

  • November 10, 2023
  • November 10, 2023
  • 1 min read

Tyler Smith, the founder and CEO of the enterprise software firm Puck.io, is facing a hard decision. Just three months earlier the company laid off 20% of its employees to reduce its burn rate amid growing economic uncertainty and a suddenly unattractive funding environment. The company’s lead investor and its board think more cost cuts are necessary, and they’re pushing Tyler to execute a second, 10% reduction in force. Worried about employee morale if they do back-to-back layoffs, Tyler and two other members of the C-suite are looking for alternatives.
Tyler Smith, the founder and CEO of Puck.io, joined the Zoom meeting and greeted Louis Saad, a venture fund partner, his largest investor, and Puck’s lead director. It was four days before the company’s board meeting, and they had a lot to discuss.

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