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May 5, 2023: The surprising upside from more bad news
Shopify's latest bout of cuts, meet another Founder paving that way in AI, connect with more employers, and more!
Profile: Raymond Chik and Untether AI
What is Untether AI?
We’re a fabless semiconductor company making chips and HW accelerators for AI workloads.
What was the insight/inspiration that led you to launch it?
I just like to start new and interesting ventures that I hadn’t done before that pushes me outside of my comfort zone.
How did you know you were ready to found a company?
Unether AI is the 4th company that I have either co-founded or helped found.
I’m a ‘new-experience’ junky.
How did you meet your founders/know they were the right people to start a company with?
I’ve been working with one of my co-founders, Dr. Martin Snelgrove, for 20 years through 2 start-ups and then started one company together prior to Untether AI. So we know very well how to work with each other and there’s a high level of trust between us. My other co-founder, Darrick Weibe, was previously working at my (and Martin’s) previous company when he was ‘in-between’ start-ups. He and Martin had known each other for 10 years.
What has been the most pleasant surprise?
Intel Capital came in as our 1st Seed investor
What are you trying to achieve over the next 12 months?
As Untether AI, the next 12 is the time we’d like to achieve a major market penetration with our 2nd generation product slated to come out, which will be one of our major milestones for our Series C fundraiser sometime in 2024.
Personally, my goal is to create a new venture/company/start-up.
I’ve always had multiple ventures going on over the past 10 years or so (but I put most of my attention on the most interesting one, and it has been Unether AI for the past few years.)
Who are the other startups you admire in your market?
StarIC - Your semiconductor integration partner
Neuron IP - integrated circuits for the era of intelligence
Quick Takes: Shopify lays off 20% of it's global workforce
What is the news?
Shopify, a Canadian e-commerce platform, announced its quarterly earnings report along with the news that it will lay off 20% of its workforce and exit its logistics business by selling it to Flexport. This is the second round of cuts made by the company since last July.
What compelled them to make these cuts?
The reason for these cuts is due to market changes; when Covid-19 hit, Shopify was on a tear, becoming the most valuable company by market capitalization on the Canadian Stock Exchange. Shopify then started to invest in logistics to compete with Amazon and continued hiring, with a growth-at-all-cost mindset. However, Covid-19 became endemic, e-commerce growth slowed, and interest rates went up, making the market no longer accept negative cash flow or growth at all costs.
Shopify decided to cut non-core projects and partner with a third party, Flexport, to handle logistics as it was a lower-margin business that was more capital-intensive and didn't align with Shopify's strategic goals.
The company's evaluation was being dragged down by the lower-margin logistics business, so it was better to split them up to get a higher valuation on both.
What are the main takeaways from this?
Shopify's decision to focus on its core business and show profitability is viewed positively by the market, with a 25% bump in share price following the news.
This indicates that companies will need to be more focused on both growth and the bottom line as they get bigger and focus on areas where they can have a differential outcome.
Quick Takes is an in-depth series that breaks down the news trends, and analysis from the Canadian Tech Ecosystem.
Hosts, Alex Norman and Alexandra Reilly bring you their takes on the top stories relevant to Canadian technologists, Founders, and Entrepreneurs.
In this episode, Alex and Alex discuss:
Shopify's latest round of cuts
A raise that may or may not happen
Our takes on more bad news from the week
More raises and announcements are discussed from the past few weeks
Quick Takes returns with a brand new episode on May 18, streaming LIVE across the TechTO platforms at 1 pm ET / 10 am PT. You can also catch up on past episodes wherever you listen to your podcasts.
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