Udacity Lays Off 55 Employees, CEO Departs, and Sebastian Thrun Returns (Again)
Dalporto has left and Thrun is back at the helm, as Udacity undertakes its fifth round of layoffs.
According to Layoffs.fyi, Udacity recently laid off 55 people, about 13% of its employees. A quick search on LinkedIn also confirmed that the company underwent “restructuring.” And upon further digging, I found that Udacity cofounder Sebastian Thrun had quietly announced the layoffs on the Udacity Blog:
“After a thorough strategic review, and in response to increasing market headwinds, we are taking a number of proactive, but difficult steps today to make Udacity’s business more sustainable for the long term. These actions affect fixed costs, discretionary costs, and — unfortunately — our people.”
In addition, Udacity CEO Gabe Dalporto is leaving the company, and Thrun is taking over the reins as Executive Chairman.
Déjà Vu
Class Central has been reporting about Udacity right from its beginning in 2012. So writing this article, we’re getting a feeling of déjà vu.
In October 2018, Vishal Makhijani stepped down as CEO of Udacity, and Sebastian Thrun took over as interim CEO. Ten months later, Gabe Dalporto was appointed new CEO. And now, he’s stepping down too, and Thrun is taking over again.
(Most recently, Sebastian Thrun was the CEO of Kittyhawk, a flying car company. Last month, we learned that Kittyhawk would be shutting down.)
Furthermore, Udacity is no stranger to layoffs. As far as we know, this is the fifth time Udacity has cut staff:
- Aug 2018: Udacity lays off 25 employees, about 5% of its workforce at the time, primarily from its German offices. In the wake of the layoffs, Vishal Makhijani leaves the company.
- Nov 2018: Udacity announces that 125 more employees will be laid off, primarily from their Brazilian offices, as part of a drastic restructuring plan initiated as Thrun returned to the company.
- Apr 2019: Udacity lays off an additional 75 employees and forges ahead with its belt-tightening plan, which includes freezing hiring, downscaling offices, and scrapping some of its programs.
- Jun 2020: In an exclusive report, Class Central reveals that Udacity China would be shutting down by the end of the year, and that its local team would be “disbanded.”
- Oct 2022: And now, Udacity is laying off 55 employees, while competitors face similar challenges: Coursera Stock Drops by 20% and 2U Cuts Staff, Recenters Operations.
So far, Udacity has raised $235 million. The last funding round that we know of entailed $75 million in debt funding in November 2020, when Udacity pivoted toward enterprise and government training.
Udacity’s Evolution
Back in the Year of the MOOC, Udacity cofounder Sebastian Thrun proclaimed that in 50 years, there would only be 10 higher education institutions left in the world, and that Udacity would likely be one of them.
Udacity was a pioneer of the modern MOOC movement, and they kickstarted the first MOOC-based degree, Georgia Tech’s Online Master of Science in Computer Science (OMSCS), which costs $6000, though the degree isn’t offered via Udacity anymore, as exclusively reported by Class Central.
But in the decade since Thrun’s prediction, Udacity has shown other signs of turmoil besides repeated layoffs and ephemeral leadership, including drastic price hikes and multiple pivots — most recently, towards corporate training. So Thrun’s prediction feels more uncertain than ever.
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RMR
March of 2022 was also a pretty significant layoff (which would make it 6 total rounds of layoffs). 50% of the North American Sales team and sales leadership were impacted.