How Startups Can Harness Top Talent Amid Industry’s Tech Layoffs

May 30, 2024

Layoffs are pounding the tech industry for the first time in more than a decade, and hiring freezes are spreading across Silicon Valley. With tens of thousands of workers abruptly laid off at Big Tech companies like Google, Amazon, IBM, Salesforce, and others, it's understandable that shockwaves are reverberating throughout the labor market.

However, this can be an opportunity for startups to hire talented professionals to join their teams. We look at how the recent big tech layoffs are affecting both tech professionals and startups alike and discuss ways to capitalize on this new influx of talent.


More Tech Employees Are Looking to Join Smaller Companies

As large companies downsize in an effort to cut costs, startups are taking advantage of the newly available talent pool.

The Big Tech layoffs have created a unique opportunity for these smaller companies to find highly trained employees who may not have been interested in working with them prior to the downsizing of tech giants such as IBM and Microsoft.

“Given the tech layoffs and lower hiring by the big-tech companies, folks are looking for smaller tech companies to join,” said Christopher Fong, an ex-Google employee and founder of

More and more tech workers are joining startups and midsize companies that offer greater flexibility or the opportunity to have a larger impact in the absence of the stability that the big tech companies once provided.

Rich Liu, Chief Revenue Office at high-value startup Everlaw says, “We’re really seeing this market shift could usher in a heyday for startups acquiring top talent, particularly for ones like us that are maturing. It’s been a big-tech talent loss but startups’ gain.”


What Tech Workers Look for In Companies

Perks like ping pong tables and snack bars are no longer enough for organizations to win the war for tech talent.

According to a report, tech workers are far more interested in factors such as flexible schedules, transparent leadership, and advancement opportunities when evaluating a new company or job.

Many cite that they’re looking for companies that offer a stronger sense of values or a clearer mission. They also want to have a greater impact than is often possible at big tech companies.

One such person is former Salesforce senior analyst Brianna Bell. After years working at Salesforce and Snap, Bell took a job at Everlaw, a lesser-known private company providing cloud-based litigation software.

“When I was looking at companies, I thought about how much can the work I bring to this company really impacts their go-to-market strategies," Bell said. "If you have a role at a larger company, especially like we've seen at Facebook and Twitter, some of their roles don't seem like they were as impactful across the company."

Other aspects like diversity and inclusion are also important for attracting new talent. Startups that make it clear they prioritize diversity and inclusion are about twice as successful at attracting and retaining top tech talent.

Finally, there is the question of how and where work is done.

More than 60% of tech professionals rank fully remote as their most desired workplace setting. Harvard Business Review also reports companies that have more success recruiting top talent are 30% more likely to work agile and 16% more likely to organize work around products rather than projects.


Benefits for Startups

Although layoffs can have a devastating impact on affected employees, it offers an opportunity for startups and businesses to bring in fresh, talented employees from larger companies that are downsizing due to market conditions.

These employees often bring invaluable skills, knowledge, and experience that smaller businesses lack – giving them a leg up when competing against larger firms.

Best of all, the addition of experienced tech professionals allows small to medium-sized enterprises (SMEs) to rapidly grow their operations while reducing costs associated with onboarding and training new employees.


Challenges of the Layoff Hiring Process

While layoffs offer a great opportunity for startups to hire talented workers, they also bring challenges when it comes to the hiring process. Companies need to think carefully about how they approach hiring former employees of larger organizations.

Finding talented tech employees can be difficult when dealing with a large-scale layoff situation. Employers have to contend with recruiting from an overwhelmed workforce that may not have enough time or patience to respond to inquiries quickly.

They’ll also have more competition for the best applicants as numerous businesses look for ways to fill their own positions with talent from these layoffs.

Additionally, employers must consider any non-disclosure agreements or contractual restrictions that might limit what former employees can discuss about their experiences at other companies.


What Startups Can Do to Attract Top Tech Talent

How should startups respond to these changing dynamics?

First, it's important they have a well-thought-out tech recruitment process, and an attractive workplace culture, as these qualities can be appealing to newly unemployed individuals seeking stability in their careers.

The second step is to recognize that, just as businesses provide value to their customers, they must also consider their value proposition to new hires. That proposition could include good pay, flexibility, opportunities for growth, inclusiveness, and a modern working environment.

Finally, companies can set themselves apart by focusing on and investing in diversity and inclusion efforts. Companies with clearly stated goals are far more successful at attracting top tech talent, and those where current employees feel more connected and included are far more successful at retaining employees.



Startups can capitalize on big tech’s recent layoffs by seeking experienced professionals whose skillsets fit their business. By leveraging layoffs as an opportunity to recruit quality talent, startups can set themselves up for success while helping those affected by job loss find meaningful employment quickly.

Furthermore, offering competitive salaries and benefits packages will help attract high-caliber candidates to your team - ultimately contributing to the growth of your business.

Start building your dream team today with Lighthouse Professional Solutions!