Startup founder in 2021: Look how many ppl work for me.
Startup founder in 2025: Look how few.
Normally more funding means more hiring, but these are not normal times.
Startups on Carta (US only) raised 70% more capital in Q2 2025 than they did at the start of 2023. But they hired 23% fewer people.
𝗪𝗵𝗮𝘁'𝘀 𝗵𝗮𝗽𝗽𝗲𝗻𝗶𝗻𝗴?
Funding is being concentrated in fewer companies, which would reduce startup-wide hiring even if the companies receiving funding were hiring "normally" (they aren't, btw).
Founders are 𝗮𝗰𝘁𝗶𝘃𝗲𝗹𝘆 𝘁𝗿𝘆𝗶𝗻𝗴 to remain lean. This seems like something they would have always done, but it really wasn't. In 2021, the more people working for you the better.
Remaining lean is also optimizing for ARR per FTE (revenue per full-time employee) which is the new hot metric in VC fundraising.
AI allows smaller teams to build / distribute / monetize more product. This is not just an AI question, however - the culture around startups has also shifted.
There is a memetic quality to big tech companies doing more with less. Probably started with the Elon/Twitter example but many such cases today.
Some of these founders lived through the 2021 period of over-hiring and subsequent massive layoffs and they'd really like to avoid that moving forward.
Good for startups (overall) and not so good for startup job seekers 😬
#startups #founders #startupjobs #startuphiring
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