It's been a wild time for tech implosions. We asked top PR experts to rank how well or badly — the fallout has been managed.
Lakshmi Varanasi
![It's been a wild time for tech implosions. We asked top PR experts to rank how well — or badly — the fallout has been managed.](/_next/image?url=https%3A%2F%2Fstaticbiassets.in%2Fthumb%2Fmsid-97136877%2Cwidth-700%2Cheight-525%2Cimgsize-293516%2Fitaposs-been-a-wild-time-for-tech-implosions-we-asked-top-pr-experts-to-rank-how-well-ampmdash-or-badly-ampmdash-the-fallout-has-been-managed-.jpg&w=3840&q=75)
- There's been some unanticipated drama in the tech industry over the past year.
- Old controversies came to a culmination while new catastrophes bubbled to the surface.
In the past 12 months:
- Sam Bankman-Fried went from being a poster child of the cryptocurrency industry to its biggest wake-up call, and lost the majority of his fortune.
- Elizabeth Holmes, the disgraced founder of Theranos, was sentenced to more than 11 years in prison with 3 years on supervised release.
- Elon Musk took over Twitter and promptly laid off half of the company's workforce. Now, he's seeking additional investors for the platform and battling cockroaches in the office.
Enough said.
Crises like these often dovetail with the desire by the people and companies affected to soften the public-relations blow.
We asked top PR experts to rank recent tech industry catastrophes, from the absolute worst in image management to the best. Here are their verdicts.
FTX: tied for first place
![FTX: tied for first place](https://staticbiassets.in/thumb/msid-97137021,width-700,height-525,imgsize-1335100/ftx-tied-for-first-place.jpg)
Sam Bankman-Fried's crypto empire began unraveling in November 2022, and left the world in shock. His net worth plummeted amid allegations that he had been misusing customer funds. He was hit with 8 criminal charges including fraud and money laundering, extradited from the Bahamas, released on $250 million bail, and now awaits trial tentatively set for October.
As the crisis continues to unfold, Bankman-Fried has been giving interviews to media outlets ranging from DealBook to Puck News. In January, he launched his own newsletter on Substack.
According to several PR experts that Insider spoke with, Bankman-Fried's media frenzy has been his biggest mistake.
"With great legal minds behind him aka his PARENTS - surely someone was insisting he not do a press tour of ANY kind. But the amount of interviews he gave was astonishing," Brooke Hammerling, founder of strategic communications firm The New New Thing, told Insider by email. "A prosecutor's dream I have to imagine for I am SURE something or THINGS he said in those interviews will come back to bite him in the ass."
Theranos: tied for first place
![Theranos: tied for first place](https://staticbiassets.in/thumb/msid-97137007,width-700,height-525,imgsize-84338/theranos-tied-for-first-place.jpg)
The fall of Elizabeth Holmes and her blood-testing startup, Theranos, is a story that began in the mid 2010s, but culminated in 2022 with her sentencing.
Two PR experts that Insider spoke said there are several similarities between the way Holmes and Bankman-Fried handled their respective crises. These experts especially lament the number of interviews, public appearances, and speeches the founders have given.
Maggie Squires, senior vice president of Moxie Communications Group, wrote to Insider by email, "This is a tempting path for charismatic founders, who often charmed their way into success in the first place, but it doesn't work. You need a clear, concise and truthful message that's shared with control."
Twitter: third place
![Twitter: third place](https://staticbiassets.in/thumb/msid-97136993,width-700,height-525,imgsize-271758/twitter-third-place.jpg)
After Musk took over Twitter in late October 2022, he laid off a majority of the company's workforce. He urged employees to come back to the office, and even arranged makeshift bedrooms in the company's headquarters.
He revamped the company's subscription tier, Twitter Blue. Now, he's searching for a CEO to replace him.
Two PR experts Insider spoke to agree that Musk's changes are for the worst.
"He quickly went in there with zero plan, zero strategy, and it was a dumpster fire," said Bruno Solari, associate vice president at Autumn Communications.
Solari said that Musk's decision to revamp Twitter Blue was a particularly unwise decision, as it led to a proliferation of parody accounts on the platform.
"It wasn't just funny parody accounts. These accounts moved markets," he said. "They started losing tons of advertisers, and brands no longer wanted to be on Twitter. You're not going to get your revenue by users paying $10 for Twitter Blue. You're going to get your revenue by the brands, by the advertisers."
Since Musk took over Twitter, more than 500 of the platform's top advertisers have paused spending on the platform, according to The Information.
Salesforce/Slack: fourth place
![Salesforce/Slack: fourth place](https://staticbiassets.in/thumb/msid-97136984,width-700,height-525,imgsize-84364/slack-fourth-place.jpg)
A few days into 2023, cloud-based software company Salesforce, informed 1,000 employees via email that their jobs would be cut. The following day, Insider reported that the company's CEO, Mark Benioff, held a "rambling, two-hour all-hands meeting" where he dodged questions about the layoffs.
"I didn't want to put a final line on it. I didn't want to say, 'This is it, one and done," Benioff said, according to leaked audio heard by Insider.
At one point, Benioff even compared the layoffs to death, casting the company's predicament in the language of a spiritual moment, Insider reported.
"At the kickoff every year, you know, we, um, have a moment where we always say goodbye to everyone who's died during the year. And, um, loss is really difficult and losing folks, and especially losing our trusted colleagues and our managers or employees, it's very similar, uh, in a lot of ways for me," Benioff said.
Employees vented their frustrations on Slack. News of the leaked meeting circulated widely across the media.
Hammerling told Insider by email, "This is about a CEO who thinks he knows better and probably didn't listen or even get guidance from comms or HR on how to handle the layoffs appropriately."
She added, "also the blame game was HIGH putting the blame on the staff as opposed to leadership taking responsibility."
WeWork: fifth place
![WeWork: fifth place](https://staticbiassets.in/thumb/msid-97136969,width-700,height-525,imgsize-34958/wework-fifth-place.jpg)
In a year of catastrophes ranging from shocking to simply dismal, the story of Adam Neumann remains a rare bright spot.
Neumann is best— or worst— known for founding WeWork, a company that provided co-working spaces and ultimately began its descent downhill in 2019.
Now, he's launching a new venture called Flow, a rental housing startup, that's already received a $350 million check from the well-known venture firm, Andreessen Horowitz. It was the largest individual check the firm has ever written, Insider reported.
Safe to say, Neumann isn't faring as poorly now.
"Adam went very quiet for years after the WeWork news broke. When he was ready to reenter the public sphere, he was highly selective with his communications, doing just one profile piece with the Financial Times," Squires said.
While the piece wouldn't be considered positive, Squires said it looked "expertly crafted" with quotes that vouch for Neumann's competence as an investor.
"A downfall narrative like his won't change overnight, but he's quietly chipping away at it enough to regain both founder and investor trust," Squires wrote.
Frank: the wild card
![Frank: the wild card](https://staticbiassets.in/thumb/msid-97136954,width-700,height-525,imgsize-1063572/frank-the-wild-card.jpg)
In 2021, JPMorgan purchased Frank, a startup that aimed to help students through the financial aid application process, for $175 million. The startup sold itself as having more than 4 million customers.
But in a lawsuit filed against Frank in December 2022, JPMorgan said the company fabricated millions of those accounts. According to the suit, Frank likely had closer to 300,000 users.
The plot twist here is that Frank's founder, Charlie Javice, also filed a suit against JPMorgan, where she claims the bank "manufactured a for-cause termination in bad faith" among other grievances.
One PR expert who spoke on background told Insider that Javice has already done as much as she can with her legal strategy to make it seem like JPMorgan is "the bad guy." And while Javice's legal chess moves are interesting, they won't necessarily pay off.
Javice, a former Forbes 30 Under 30 honoree, also joins the likes of other famous fraudsters like Elizabeth Holmes and Sam Bankman-Fried who made the list.
Another expert joked that it might be time to reconsider who goes on the 30 Under 30 list.
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