CEO defends Silicon Valley start-up that bragged about how it fires people

EXIT

A Silicon Valley start-up is raising eyebrows after releasing an ad campaign and blog post touting the company's firing strategy.

San Francisco–based Expensify, which created an app to make expense reporting easier, posted subway ads that included the phrases "We fire people" and "Making tough decisions since 2008."

The company's corresponding blog post, which details how it fires problem employees, says "careful application of firing is actually more important than hiring."

The campaign has sparked criticism from those who say celebrating firing people epitomizes the Valley's ruthless, churn-and-burn culture.

Expensify has approximately 100 employees and has laid off about 20 people since it was founded in 2008.

Its founder and CEO David Barrett defended the ad and blog post, telling CNBC that the "We fire people" slogan is part of a larger campaign geared toward selling a company asset — transparency.

"Fundamentally this is about trying to find the diamonds in the rough — the people who are looking for an environment that is built on respect and transparency," Barrett said.

The ad campaign also includes slogans like "Get [poop emoji] done" and "If asking for a raise works, it means they've been underpaying you all along."

"It's much easier just to not talk about these sorts of things, but we think they are so important that they are worth talking about and that the people who appreciate these will respect that," the CEO said.

While transparency may be a noble goal, Barrett's blog post makes some cringe-worthy assumptions. For example, it says new hires distract other team members, which can reduce productivity while simultaneously requiring more overhead costs.

"In a collaborative team where everybody talks with everybody, it also means everybody distracts everybody — just a little bit. This little bit adds up over time," the post reads. "Even worse, while productivity increases linearly, overhead increases exponentially ... with every new hire, not only do you distract one more person, but one more person distracts you."

Barrett said the intention of the article and the ad was to recruit the right type of employees.

Originally, Expensify was going to highlight the perks it offered, like its annual overseas trip for workers and their families.

"But we said, 'This is the wrong thing to emphasize,'" he said. "Yes, this is a cool part of the company and we're very proud of it ... but anyone who applies just because of that, really they're applying for the wrong reasons."

Barrett said the company actually made an "incredible hire" from the ad. The new employee blogged about it here, saying he was intrigued by a company that "proudly proclaimed their work ethic, compensation, and firing practices; several 'sacred cow' topics in any industry."