Job cuts continue at Google. Google parent Alphabet moonshot factory X is reportedly restructuring, laying off some staff and turning to outside investors to fund its ambitious projects. According to a report in Bloomberg News, “Alphabet Inc.’s lab for pioneering technology is laying off dozens of employees as it turns to outside investors to help fund its ventures.”
The X lab is reportedly adopting a new structure that will enable its projects to more easily spin out of X as independent startups with support from Alphabet and outside backers, according to one of the people and an email to staff obtained by Bloomberg.“We’re expanding our approach to focus on spinning out more projects as independent companies funded through market-based capital,” Astro Teller, who leads to lab, wrote in the email. “We’ll do this by opening our scope to collaborate with a broader base of industry and financial partners, and by continuing to emphasize lean teams and capital efficiency.”
Launched by Google co-founders Larry Page and Sergey Brin, the X lab is known for tackling big challenges like climate change and internet access, has struggled to turn its ideas into lasting businesses. Now, it’s opening up to venture capitalists and other partners to help its projects spin out as independent startups.
This means more layoffs, focused on support staff, and a shift towards leaner teams and market-based funding. While X has captured imaginations with projects like self-driving cars and internet balloons, pressure is mounting for it to produce real profits.
What X Labs head told employees
“We’re expanding our approach to focus on spinning out more projects as independent companies funded through market-based capital,” Astro Teller, who leads to lab, wrote in the email. “We’ll do this by opening our scope to collaborate with a broader base of industry and financial partners, and by continuing to emphasize lean teams and capital efficiency.” “This approach will give us more opportunity to focus on what Xers do best: inventing breakthrough technologies to help solve some of the world’s most pressing challenges,” Teller wrote in the note to staff. “Because the world needs moonshots more now than ever.”
Reflects Google’s new strategy
This move aligns with Alphabet’s broader cost-cutting efforts, including recent job cuts in Google’s hardware and engineering teams. With CFO Ruth Porat taking on a new role overseeing X, more financial discipline is expected.
Previously, X’s “moonshots” faced hurdles graduating to independent ventures within Alphabet. The new approach aims to remove this bottleneck and give promising projects a path to flourish outside the tech giant’s walls.
This shift also reflects the broader challenges faced by Silicon Valley’s innovation labs, with budget cuts and layoffs becoming more common. X, however, remains committed to its mission of tackling tough problems, emphasizing that “the world needs moonshots more now than ever.”