Flickr Co-Founder Butterfield and Chief Architect Henderson Working on Stealth Start-Up
Yesterday, several Flickr engineers posted news of their layoffs from the Yahoo photo-sharing unit on Twitter, which caused GigaOm's Om Malik to notice that Flickr architect Cal Henderson (pictured here) was also no longer on its About page.
Context & Ripple Effects
Flickr has been drifting away from Yahoo for a while: the 2007 shutdown of Yahoo Photos in Flickr's favor made it Yahoo's flagship photo property, but by mid-2008 ReadWriteWeb was already writing about the co-founders on their way out of Yahoo. What changed this week is that the departure reached the engineering core — several Flickr engineers tweeted their own layoffs from the unit, and GigaOM picked up the story, noticing chief architect Cal Henderson had vanished from the About page.
That attrition has now crystallized into something concrete: Stewart Butterfield and Henderson are confirmed to be working together on a stealth start-up. The same layoffs gutting the product are supplying the founding team of its successor.
First-order effects
- Yahoo's photo-sharing unit loses both its chief architect and several engineers in one round, leaving Flickr without the people who built it just as the service carries Yahoo's entire consumer photo strategy.
- Butterfield and Henderson gain a founding team with direct experience scaling a consumer photo service — and a pool of freshly laid-off Flickr engineers to recruit from.
Second-order effects
- Other Yahoo acquisitions face a retention test: the visible exit of a marquee team right after layoffs tells every acquired founder inside Yahoo what happens when their unit hits a cost-cutting cycle.
- Competing photo-sharing services get an opening to court displaced Flickr talent and users who read the layoffs as a signal about the product's priority inside Yahoo.
Third-order effects
- If the pattern holds, Yahoo functions less as a long-term home for acquired products than as an incubator whose best teams leave to found the next generation of startups — raising the question of whether big-company consolidation of web services ultimately feeds rather than prevents competition.
The trend: Post-acquisition attrition at Yahoo is converting acquired web teams into founders, with layoffs acting as the trigger that turns departures into start-ups.