Welcome to Black January: Microsoft, Intel, IBM and others lay off tons

I’m tracking the dismal news on all the various blogs. This is the worst month the tech industry has ever seen. The bad news from Microsoft, Intel, IBM is all over TechMeme and TechFuga.

Wake me up when it ends. More later, but today there is some good news, just not enough to stop the tide of bad. A new startup, Plinky, will come out of stealth mode at 1 p.m. (we’ll have a video of that up on FastCompanyTV) and I’m getting around Silicon Valley and San Francisco starting at 9 a.m. at Seesmic, with stops in Mountain View to see something secret, and Sunnyvale. Back to San Francisco tonight for a Fast Company dinner event. Whew!

My heart goes out to all the people who’ve lost their jobs this month. What’s worse is it isn’t over.

Solution? Next week at the World Economic Summit my “Davos Question” is how can we create one million new startups with a failing/failed VC system?

That’s what it will take to repair the damage this month has done to the tech industry and our economy. Yes, the depths of our problems ARE that deep. Got any ideas?

Layoffs and, um, funding?

TechCrunch started a page to keep track of layoffs in the startup world.

Me? I’m seeing tons of depressing news hitting our economy. That’s what I get for watching CNBC and reading TechMeme.

But, there were a group of companies funded this week too and there are plenty of jobs open. It sure is an interesting time to watch the startup community right now.

How would you report this ongoing story? Several over on FriendFeed want bloggers to avoid overcovering the bad news and, instead, focus on the positive news. What do you think?

Who is doing the best at covering the economic times hitting startups? My top vote is for VentureBeat.

The Well Funded Layoff

Today Seesmic laid off seven staff members, after laying off three other members a couple of weeks ago.

They have millions of dollars in the bank and are well funded. Why would they do that?

Well, I went over and hung out with the remaining staff and CEO Loic Le Meur this afternoon to learn more and to try to discern the advice that Le Meur got and how many other startups are about to do the same thing. Here’s what I learned.

First, Le Meur has a really deep set of advisors. People like Pierre Omidyar , the founder of eBay and Martin Varsavsky founder of Fon.

They are telling him that the downturn will be deep and will be multi quarter. They told him it was a good idea to conserve cash and bunker down.

Translation: Le Meur isn’t the only one getting this advice. Sequoia Capital told its companies the same thing.

The thing is Le Meur is better connected around the world than most of us. He’s been seeing this downturn coming for months and has been tracking it, so he’s one of the first who is mentally ready to move. He told me that he predicts other CEOs will do the same thing over the next couple of weeks. Those who don’t, he told me, will be told by their boards over the next few months to take the same actions if the CEOs don’t make the hard decisions to do this today.

“But what if the economy turns back up in the next month?”

Well, Le Meur told me he just cut jobs that aren’t core to the mission of Seesmic. Designers. Marketers. PR. He told me all those functions are outsourceable and aren’t core to what they do. The folks sitting around the table were developers, people who kept servers running, who were directly responsible for keeping customers happy.

This is a smart strategy. First, it keeps people who are core to the mission happy because they know the CEO took steps to protect their jobs even if the world goes to hell. CEOs who wait until their hand is forced won’t see the same morale saving effect that Le Meur will see here. Second, it saves capital for potential acquisitions after other companies run out of cash and are forced to beg to be purchased the way my old company was (PodTech sold for a few hundred thousand dollars after having millions in capital pumped into it). Third, it saves capital for later when the storm clears and they will want to expand. Fourth, it gives them more time to find a business model since advertising is going to be a tough sell for a company like Seesmic right now.

But, Le Meur didn’t come to this decision easily. He literally teared up with me today. Being a leader and making really tough choices isn’t easy and this market isn’t easy to navigate for anyone.

My thoughts are with the workers who are laid off. How can we help you find jobs? Let’s have some innovative thinking about that too.

Who is next?