The Hard and Valuable Lessons of 2023 + 2024 Predictions

At the end of every year, I sit down and do a personal and professional year-in-review, and I've gotten a lot out of it. This year, I am open-sourcing my year in review in hopes it can help other CEOs or professionals on their journey or inspire them to do a similar reflection. Based on what I learned, I also jot down some of my predictions for the year ahead.

So, without further ado…

Reflections on 2023

War Time CEO

The first lesson of 2023: have multiple bank accounts with various banks. I am not kidding. The collapse of Silicon Valley Bank was the first domino to fall, triggering what David Sacks called the year of the "Enterprise Recession"; interest rates went way up, investment capital dried up, companies needed to cut costs, and anyone selling to those companies – especially SaaS, and enterprise marketplaces like Braintrust – feel the pain. 

Lesson number two: when you feel growth stalling out, you need to change your mindset — and fast – to act like a War Time CEO. Ben Horowitz of a16z speaks at length about this - especially in 2023. We had to make some difficult cuts, downsizing (right-sizing?) our own team by 40%. Cutting fast and deep is extremely painful, but you come out the other side better/stronger; I actually promised our team this would be true, and it was. Immediately, you felt the energy shift; people become more focused, engaged, creative, and shocker – efficient – without the weight of a lumbering, slow-moving org structure weighing them down.

Lesson 3: Raise prices. Braintrust already was (and still is, by far) the high-quality, low-cost carrier of 2023 and we realized that the value the network provides + the vast client install base it serves, so we proposed a fee increase (10% to 15%) and it was overwhelmingly passed by the community.  That means more client fees that can purchase BTRST to replenish the DAO and continue to grow the network faster.

Ride The Wave

The Enterprise Recession totally inverted the Braintrust marketplace, bringing a new set of challenges and opportunities. This brings me to lesson number three: don't fight the market forces; capitalize on them. 

During COVID-19 (2020-2021), there was insatiable demand from customers for highly skilled technical talent; we couldn't bring enough talent in fast enough to meet the demand and were actually turning people away. Starting in mid-2022 and throughout 2023, the opposite became true. By May 2023, 75% of our enterprise clients were on a full hiring freeze. 

So what did we do?  

We doubled down on acquiring new talent. We went from 128,467 to over 530,000 talent (4x) for free ($0 CAC). This ensures we'll be prepared to capture a disproportionate market share when the market rebounds. In fact, we have enough talent in the marketplace today to sustain over $1B in annual GSV. 

Hot Topics: Remote Work + AI

So clearly, in 2023, employers gained the upper hand; with hundreds of thousands of highly skilled tech workers on the market, they could pick the best global talent. So what did they do? Demanded people come back to the office. 

During Covid, we proved you don't need to be in an office, and, in fact, there are profound advantages to hiring globally, yet somehow, the corporate overlords have brought us back to a 2019 butts-in-seats mentality. It's genuinely baffling. This leads me to lesson number four: the future is still CLEARLY remote. 90% of jobs posted on Braintrust are fully remote, our core team operates entirely remotely, and it's FAR more efficient.

Now, we can't talk about efficiency without bringing in the buzzword of 2023: AI. This technology is incredibly powerful and enables companies to scale with fewer people. This leads me to lesson number five: tech companies should not grow their headcount linearly with revenue. I've been saying this for years, but it takes a monster tech recession for companies to learn that they can operate better with far fewer staff members.  

After our RIF over the summer, the first thing we did was double down on our investments in automation. We can't control the macro forces, but we can control how we harness this new technology to position us to win when the market returns. Specifically, we've been hyper-focused on automating the matching process. Previously, we guaranteed qualified matches in 48 hours; in the new year, the top five matches for any role posted to Braintrust will instantly be surfaced to the hiring manager. 

**Public Service Announcement**

For Talent: Any reasonably talented engineer can learn AI skills on their own. I've seen members of the Braintrust core teams and community do it in months (not years), and we've seen hourly rates for AI skills command 50% higher than regular software engineering rates, so it's well worth the time investment. And best of all? No expensive degree is required.

For Clients: If you're reading this and you *don't* have an AI strategy for your company yet, you should get on it. I've helped a lot of our clients and some of my portfolio companies with this - if I can be helpful to you, feel free to reach out.

Don't talk about crypto.

Lesson number six: the technology that shall not be named. Just get the word out of your mouth … for now. It was a bad year for crypto, deservedly so. Some bad actors put a well-deserved black eye on the space, but it's a write of passage and a tailwind for the maturity of this space.

But wait to write off crypto! There's a ton of innovation in the space, and it continues to get more user-friendly and sophisticated at the same time. There is a new phenomenon called DePIN, which stands for decentralized physical infrastructure, which is growing like crazy. Coinbase is building a layer 2 called Base L2, which allows you to do all the transactions you would do on Ethereum but faster and at a fraction of the cost. 

Now, one of the big open questions is around regulation. Earlier this year, I joined Coinbase CEO Brian Armstrong in Washington D.C. for "Stand with Crypto" day and met with regulators on Capitol Hill. Their message was clear: let's establish common-sense regulations and move on to more significant problems. This is something we can all agree on. 

The future is (still) user owned 

Crypto may not be on the top of everyone's Christmas list this year, but it should be because, for me, the last lesson of 2023 - lucky number 7 - is that the future is user-owned. Blockchain tokens allow for a whole new value creation and distribution model that is more fair to workers and better for business, and it shows. Talent on Braintrust has earned over $200M via the platform, along with ownership and control in the network. At the same time, companies like Instacart, Uber, etc., continue to be plagued with inequity for the workers and misaligned incentives. 

I sound like a broken record, but let me say it one more time: user-owned networks will grow faster and be more valuable than investor-owned networks. 

Predictions for 2024

1. That painful Enterprise Recession that defined 2023 will hang around for the first half of 2024, but my prediction is we'll see things start to rebound in H2. We're already seeing signs of thawing at Braintrust, which is typically a leading indicator of the "Enterprise Economy."

2. As things rebound, companies will rely more on elastic workforce solutions like Braintrust instead of just loading back up on FTEs. People will pay for outcomes or results.

3. Remote work will remain table stakes for most roles. Companies will make in-office time more collaborative and creative instead of compulsory and punitive.

4. The productivity gains (and thus margin growth, which leads to higher enterprise value) will be driven by early gains seen by AI being implemented across the Enterprise world, and conversely, enterprises not implementing AI to improve their efficiency / UX / margins will start to lose market share.

5. I strongly believe AI will create more jobs than it destroys over time, but the destruction phase will come first – and we're in it. I'm hopeful we've seen the worst of it on the layoff front, but we may have more to come as AI replaces lower-level knowledge worker jobs.

6. Public perception has a long way to go, but my guess is we get a new administration in 2024 (Jan 2025), and that drives a lot of the regulatory clarity this industry needs. Once that happens, the industry can continue to mature, keep out bad actors, and prevent this awful brain drain we're seeing from the US to places like Dubai and Singapore. This needs to be reversed ASAP.

What's Next? 

I have a lot of optimism for the year ahead. Taking my own advice, we've been doing a lot of work behind the scenes here at Braintrust to make sure we're ready when the market returns. We're not ready to announce anything yet; we've been working on a product at Braintrust that will change the recruiting landscape forever - and not in an incremental way. I can't wait to share it with you.

I would love to hear your thoughts and feedback on this list, and especially your learnings from 2023 and predictions for 2024. Please find me on X or the Braintrust professional network @adamjacksonsf  and share your POV. 

I wish you and your family a happy, healthy holiday season and a prosperous year ahead.

Adam

@adamjacksonsf

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