Uber laid off 3,300 people on September 2, 10% of its workforce. The reason, according to the CEO's own memo, wasn't falling revenue: "that growth also brought complexity: more layers, more coordination, more fragmented accountability."
Revenue nearly tripled in five years. What was left over, and bad, was the structure.
This matters to small business owners not because of size, but because of the criteria: Uber didn't cut by department, it cut by team format. And the format it targeted exists in a ten-person company too.
What Uber cut, exactly
- 20% of managers. Some of them stayed at the company, as individual contributors.
- Half of the one- or two-person teams. A team that size almost always means one manager with one or two direct reports.
- Anyone more than seven layers from the CEO.
- Department mergers: engineering, science, and delivery became one unit; restaurant delivery, retail, and direct sales operations were unified.
- The end of remote work, with less than 1% of the workforce staying remote.
Scaled to size, three of these five measures apply to a ten-person company.
A layer isn't an org chart
Small businesses tend to think they have no layers because they have no org chart. They do.
A layer is anyone who has to say yes before a decision turns into action. It doesn't matter whether they have a title, whether it's written down, or whether it's the owner replying to a message at the end of the day. If the answer to a customer has to wait, there's a layer.
That's why a ten-person company can have four layers without a single manager: whoever handles support asks the salesperson, who asks the owner, who checks with the accountant, who sends it back to the salesperson.
The three-question test
Time it, instead of guessing:
- How many yeses does it take for a customer to get a response? Not the perfect response, the first one.
- How many yeses to change a price within a range you've already set yourself?
- How many yeses to start a small test — a campaign, a page, a new supplier?
If any of these answers is more than one, there's a layer to cut. And cutting doesn't mean firing: it means agreeing in advance on how far each person can decide alone.
The small-business equivalent of the micro-team Uber killed off is the owner who approves everything. It doesn't show up on any org chart, and it's the most expensive layer there is, because it's the one that jams every decision at once.
The 70% question
A question circulating among innovation consultants gets asked to CEOs of large companies: does your company have a high-margin line of business that two people with AI agents could replicate in 60 to 90 days? About 70% say yes.
It's a consulting figure, not academic research, and should be read as a signal, not a measurement. But the signal points to something verifiable: a large part of what a big company does is coordination, and coordination has gotten cheap.
For small businesses, the takeaway is the opposite of the usual one. Your advantage was never scale. It's deciding fast. Stacking up approvals means giving up the one advantage you have over a big competitor — and doing it right when their coordination tool just got cheap.
What not to copy from Uber
Two honest caveats.
Cutting people isn't the same as cutting layers. Laying off staff without changing who decides what just spreads the same bottleneck across fewer people. Uber changed its decision-making structure; the layoffs were a consequence, not the method.
The end of remote work isn't a lesson for small businesses. It makes sense for a 30,000-person company to consolidate teams into a few offices; for a team of ten, mandatory in-office presence usually costs you good people and buys back no speed at all. Copying that part means copying the wrong remedy.
Where to start this week
- Write down who decides what, one line per decision type. Discounts, deadlines, exchanges, purchases up to a certain amount, complaint responses. The list usually fits on one page.
- Give autonomy with a ceiling. "Handle it yourself up to this amount" solves more than any customer service training ever will.
- Get rid of the micro-team. Anyone with one or two people under them should usually be working alongside them, not approving their work.
- Measure again in thirty days with the same three questions. It's the only way to know if anything changed.
Once decisions are in the right place, that's when it's worth automating whatever repetitive work is left — that's the work of AI implementation for businesses. Automating before that just makes the bottleneck reach the same neck faster, as we covered in when you have more than one AI agent.
On the bigger picture, two more of our articles: it's not the job that disappears, it's the advantage that changes hands and why companies are adopting holacracy.
Sources
Dara Khosrowshahi's memo to Uber employees, reported on September 2, 2026 by TechCrunch, Al Jazeera, and Bloomberg, with details on the 20% cut to managers, the halving of one- or two-person teams, and the removal of anyone more than seven layers from the CEO. The 70% question appears in Peter Diamandis's newsletter from August 26, 2026, attributed to Salim Ismail.
Frequently asked questions
How many people did Uber lay off, and why?
3,300 people, 10% of the workforce, announced on September 2, 2026. The reason stated in CEO Dara Khosrowshahi's memo wasn't falling revenue, but excess structure: too many layers, too much coordination, and accountability spread too thin after years of rapid growth.
What counts as a “layer” inside a company?
It's anyone who has to say yes before a decision turns into action. It has nothing to do with title or org chart: if a response to a customer has to wait on someone's approval, that's a layer. That's why a ten-person company can have four layers without a single manager.
How do I know if my company has too many layers?
Measure three things: how many yeses it takes for a customer to get a first response, how many to change a price within an already-approved range, and how many to kick off a small test. If any answer is more than one, there's a layer to cut. Cutting it means agreeing on where each person can decide alone, not laying anyone off.
Does cutting people fix a layers problem?
No. Laying people off without changing who decides what just spreads the same bottleneck across fewer people. What actually matters is changing the decision structure; at Uber, the layoffs were a consequence of the reorg, not the method itself.
What's a “micro-team,” and why did Uber cut them?
It's a team of one or two people, which almost always means a manager with one or two direct reports. Uber cut these teams in half because they add a layer of approval without adding execution capacity. In a small company, the equivalent is the owner who signs off on everything.
Should I end remote work the way Uber did?
Probably not. Concentrating teams in a few offices makes sense for a company with tens of thousands of employees. On a ten-person team, mandatory in-office time tends to cost you good people without buying back any speed. Borrow Uber's decision criteria, not its office policy.