Why is Perfect Day traumatizing employees?

Latest round of cruel layoffs for a well-funded "alt-protein" company

Another day, another round of layoffs at a biotechnology “alternative protein” company; this time, Perfect Day. I have written previously about the confusing greenwashing of this company’s dairy alternative labels. 

I have also written about how bloated companies such as Beyond Meat lay off lower level employees as a scapegoat for poor management practices. 

Perfect Day is now part of this shameful club. The company claims to make “animal-free milk protein by fermentation”, which is a euphemism for genetic engineering. They also claim to be making a “kinder, greener protein designed for a sustainable future”.

Except when it comes to its own workforce.

The natural products media outlet NOSH recently reported that Perfect Day laid off 15% of its workforce by shuttering its consumer brands. If you have seen “Brave Robot” ice cream in stores, that’s going away. What caught my eye about the NOSH report was how the 134 employees were told they lost their jobs:

On the morning of July 6, employees within the consumer division were informed of their termination via a letter sent to their personal email accounts and were simultaneously locked out of their computers and work software. A spokesperson for Perfect Day said that while the company maintains its headquarters in the Bay Area, the layoffs were conducted digitally due to remote workers.

Remote or not, this is no way to treat people. I have spoken to numerous former employees (at other biotech companies) who were laid off suddenly (sometimes locked out immediately) and many are traumatized by the experience. Adding insult to injury, Perfect Day’s employees are likely people working for a “mission-driven” company out of a passion for what the company allegedly stands for. 

According to Psychology Today, being laid off is an “underrated trauma”:

Layoffs are in general a difficult and underrated traumatic event for people to discuss. In our driven capitalistic society, whether we like it or not, the workplace becomes a central part of our identities and our lives spent. So when we are fired, it can feel like the ultimate repudiation of everything you have done until that moment, all the hours and hard work and time you have put in, the relationships you have built, and more. And this doesn’t even go into the practical anxieties of lost income and figuring out what your next steps or job will be.

And the article doesn’t even take into account Perfect Day’s cruel method of being laid off by being immediately cut off with the only communication to your personal email. The hypocrisy of a company that claims to doing things “kinder” is especially appalling. It’s simply unnecessary and cruel to treat people like potential criminals. 

Moreover, clearly the leadership is to blame for its shifting priorities. Here is how NOSH describes the confusion in Perfect Day’s business model:

Perfect Day began as a consumer facing milk brand before announcing a pivot to ingredients sales in 2019. Two years later, Perfect Day co-founders Ryan Pandya and Perumal Gandhi led an investment into TUC [The Urgent Company], a new company created to develop products using Perfect Day proteins alongside its own Brave Robot line. But in 2021, Perfect Day changed its consumer products strategy again, announcing that TUC was now “a full-fledged part of the [company] umbrella” and would operate as a fully owned subsidiary of Perfect Day.

In conjunction with that announcement, TUC launched the Modern Kitchen line of cream cheese, which came after a short-lived line of Brave Robot cake mixes. The [dairy ice cream] Coolhaus acquisition followed in December 2021. Though executives said that the ice cream brand would begin to phase out its existing SKUs in favor of Perfect Day-based products, the bulk of Coolhaus’ portfolio has remained dairy-based and pea protein-based. 

It’s actually even complicated than that. The company started in 2014 (not 2019) and ever since could not decide if it was an ingredient company or a brand. According to the company’s blog, they had shifted to a B2B model back in 2017:

In 2017, we stopped thinking of ourselves as a new competitor among the plethora of existing dairy alternatives. Instead, we saw a future in which we could empower all sorts of food and dairy companies to offer kinder, greener products to their customers.

After this, came the doomed consumer brand approach. The leadership seems rather confused on its business model and where to focus its resources. And this company has a lot of resources, with investments totaling over $700 million. Just because you have squandered much of that cash on brands that went nowhere is no reason to punish your workers. 

If you have made bad business decisions, take ownership of it and treat your people with grace and kindness on their way out. I worry about the remaining large workforce at Perfect Day. If the 134 represents 15% of the company’s employees, that leaves over 700 workers still at risk. And the company is apparently running out of cash; NOSH reports the they are planning yet another fundraising round. 

What have they done with over $700 million? How about investing more in your people. As one psychiatrist recommends:

Workplaces and employers also need to pay more attention to the psychological and financial sequelae of layoffs and should try to institute systematic access to counseling or unemployment benefit support when they let people go.

In other words, buy your employees some trauma therapy instead of tossing them to the curb.