Tailwind lays off 75% of its 4-person engineering team, citing 'brutal impact AI has had on our business'

"Tailwind, like many startups, has a small head count. In a podcast posted on X, Wathan said that the company had four engineers on staff. Now, there's one. Wathan's post highlights the challenges that startups, which already face tough odds of success, can encounter as AI models grow more capable. The CEO founded the web developer tool in 2017. Tailwind's model is free and open-source, with a paid "pro" tier driving the company's revenue."

"Traffic to Tailwind's online documentation has seen a 40% decrease, Wathan wrote. Those resources were where people learned about the paid tier, the CEO wrote, crushing its ability to make money. Revenue is down 80%, he added. The remaining team after the layoffs is the three owners, one engineer, and one part-time employee, the CEO said. "That's all the resources we have," he said."

Tailwind reduced its engineering team from four to one, laying off three engineers and cutting 75% of its engineering staff. Online documentation traffic fell about 40%, undermining discovery and conversion into the paid pro tier and causing revenue to drop roughly 80%. The product remains free and open-source with a paid pro tier that previously drove most revenue. The remaining staff consists of the three owners, one engineer, and one part-time employee. Holiday revenue forecasting revealed the situation to be significantly worse than expected, and the company attributed the downturn to AI-driven changes in user behavior around documentation.

Read at Business Insider