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AMERICAN FORK — Domo CEO Josh James spent some of his Thursday calling CEO after CEO looking to see if they were hiring. It wasn’t for himself; it was for the people he had just laid off.
The American Fork-based cloud software company was forced to cut roughly 10% of its workforce due to the economic impact caused by the novel coronavirus outbreak. In all, about 90 people were laid off.
"This decision was 100% driven by the pandemic," James told KSL.com. "While the business is currently pacing well, there is so much uncertainty ahead, and we needed to ensure that we keep ourselves in a position to protect our business and continue to serve customers for the long term. Parting ways with people who have become part of the fabric of the company, particularly in an environment like this one, is incredibly difficult."
What makes it even more difficult to stomach is that the current crisis has allowed Domo to show just how valuable it can be. The company, which specializes in providing real-time access to data, built a crisis command center for the state of Utah that brings together private and public data to help coordinate a response to the pandemic.
"Now more than ever, state and local governments, as well as our customers, need this fast access to different types of data to navigate through this environment," James said.
Even with the layoffs, James expressed confidence that the company would be able to navigate through the pandemic. The company is deliberately reducing costs — which also including eliminating expenses which were deemed nonessential along with the layoffs — to help put Domo in a strong position moving forward.
James told CNBC’s Mad Money that the company reduced costs by $30 million.
In an emailed response to questions from the comments of a previous version of this story, James said the $30 million is coming from "a decrease in marketing expenses, decreases in nice-to-have perks, and cutting all non-essential expenses unless it pertains to keeping and protecting our employees, retaining and serving our customers, or winning new contracts in the short term."
James also stated Domo executives took a 10%-27% pay cut to avoid more layoffs — more senior executives were at the higher end of that range.
"Before the environment drastically changed, we were about nine months away from being profitable," James said. "With the economy as a whole slowing down, we can’t be in a position where we come close to running out of money."
James had also refuted the social media rumor that laid-off employees were asked to sign a nondisclosure agreement or a gag order in order to receive severance pay.
"No truth whatsoever," he said. "We would never prevent someone from talking about the fact that they are no longer working at Domo. These are great people and friends whose lives have been further disrupted yesterday. We’re doing everything we can to help every employee who was affected by this decision get back on their feet as quickly as possible."
And that’s why he spent Thursday trying to find a spot for them to land.
"I appreciate that Utah is close-knit community," James said. "We take care of each other. I’m thankful for the other leaders in the state that are doing their part to ensure we manage through this pandemic as safely as possible, and I’m thankful to so many who have expressed interest in helping the great people who are leaving Domo get back to work."
