Earlier this week, Brave laid off 27 people, or about 14% of its workforce. Was the cost of running its relatively new Leo chatbot to blame, or is the company having more serious financial issues?
The last time we talked about the folks at Brave Software laying off workers was back in early October, so nearly a year ago. At the time we reported that TechCrunch was reporting that the company behind the cryptocurrency pushing Brave Browser, had laid off 9% of the company’s workforce, but didn’t include a count on how many people it takes to be 9% of the company’s workforce.
I opined that the company couldn’t have more than 20 or so employees, so guessed that maybe 2 people were let go. I was wrong, by more than a country mile.
Yesterday we heard (again from TechCrunch) that the Brave Software folks are once again handing out pink slips — this time to 27 people. For this article, TechCrunch reporter Ivan Mehta did a little digging and turned to PitchBook, which keeps records on such things.
According to PitchBook, Brave has 191 employees, which means the current round of layoffs affects something like 14% of Brave’s workers. It also means that the layoffs back in November put the number of people put out of work at something like 17… or 15 more than I guesstimated at the time.
There’s nothing like a little egg on one’s face to put a different shine on what was otherwise starting out to be a really nice day. 🙁
Brave’s Move From Cryptocurrency to Generative AI
When Brave got started with its initial browser offering in 2016, its plans were to fund itself with a heavy dose of cryptocurrency.
In early 2017 it held an initial coin offering for its Basic Attention Token — a cryptocurrency token based on Ethereum that it created for use in its ad exchange platform and as a cryptocurrency — in which it sold one billion BAT for a total $35 million in less than 30 seconds. The company held in reserve an additional 500 million BAT to be used to promote the adoption of the browser platform — which would include an opt-in plan to pay users in BAT for ads that would appear in their browser whenever they were online.
Out of curiosity, we at FOSS Force gave the plan a go in 2021 and quickly realized that the program definitely wasn’t going to help anybody put beans on the table. In 2023, after 2 1/2 year being on the program we had earned a total of $2.75.
“In all fairness, it would be more, because under the program you have to claim your earnings within a specified amount of time at the end of each month or you lose them, and there have been numerous months when we’ve forgotten to do this,” I wrote in an article on Brave in January, 2023. “Looking at the records in our browser, it appears that our average monthly take when we’ve remembered to claim our earnings, has been 2.500 BAT or 44 cents in real money.”
Lately the company seems to be moving away from its rewards program as a way of monetizing the browser, although that program remains in place. Last November, the company added Leo, which is an LLM-based chatbot developed in-house using Meta’s LLaMA 2 large language model and Claude LLM from Anthropic. Brave users get a very limited amount of free use of the chatbox before they’re told to either pony-up $15 monthly for expanded use, or else come back later for another short free session.
To me, the free sessions seem to be surprisingly short. What follows is the entirety of a chat I had yesterday with Leo, before the conversation was ended:
Me: What can you tell me about the layoffs at Brave Browser that were announced today?
Leo: Based on the search results, Brave Software, the company behind Brave Browser and Search, has confirmed it has laid off around 9% of its employees. The exact number of affected staff hasn’t been disclosed, but it’s reportedly a cost management decision due to the challenging economic climate. Brave Software has raised over $42.3 million in funding and is known for its privacy-focused browser and search engine that do not track or record user data.
Me: How many more layoffs are planed by Brave Software?
Leo: Based on the provided search results, there is no information indicating the exact number of additional layoffs planned by Brave Software. The company has confirmed it has laid off 9% of its workforce, but no information about further cuts has been disclosed. The decision was reportedly driven by the challenging economic climate.
Me: Is Brave Browser still connected with cryptocurrency?
Leo: Yes, the Brave browser is still connected to cryptocurrency through its Basic Attention Token (BAT). Users can earn BAT by viewing ads and use it to make donations to websites and content creators, or purchase gift cards. However, as of January 2022, users need a verified account connected to Brave to earn BAT.
Me: How much has Brave Software’s connection with cryptocurrency hurt its business, given the fact that a lot of people think cryptocurrency is not a good idea and perhaps a scam?
Leo: It’s challenging to quantify the impact of Brave’s connection with cryptocurrency on its business, as various factors contribute to a company’s success. While some individuals may have reservations about cryptocurrency, Brave’s model also offers advantages, such as user privacy and rewards. The perception of cryptocurrency as a scam or a good idea can vary greatly among individuals and communities. Brave Software’s success is likely influenced by a combination of factors, including its approach to user privacy, performance, and user experience, in addition to its connection with cryptocurrency.
Me: Do you think the latest round of layoffs could have been avoided if Brave dropped its connection with cryptocurrency, which is likely a deal breaker form many potential users.
Leo: Determining whether the latest round of layoffs at Brave Software could have been avoided if they had dropped their connection with cryptocurrency is speculative and depends on various factors. The decision to incorporate cryptocurrency into their business model is likely influenced by multiple considerations, such as potential revenue streams, user rewards, and privacy-focused innovations. It’s essential to understand that layoffs can occur for various reasons, including financial restructuring, strategic shifts, or market conditions.
In summary, while it’s impossible to know for certain whether the layoffs could have been avoided, the connection with cryptocurrency is just one of many factors influencing Brave’s business operations and success.
Me: How about Leo? Has the addition of generative AI had a positive effect on Brave Software?
It was at this point that I was served the graphic to buy a Leo subscription or wait until later to start another conversation.
In June of this year, the chatbot was also moved into Brave’s search engine to augment search results.
Past Controversies
Although Brave sells itself as a privacy respecting company, it has sometimes engaged in questionable activities that have not respected privacy.
For example, Brave’s browser supports Tor as part of its private-browsing mode. However, in 2021 it was reported through the company’s HackerOne bug bounty platform that Brave was sending DNS requests to users’ ISP instead of routing it through the Tor network, which defeated the purpose of using Tor by handing ISPs knowledge of a user’s browsing sessions.
Although the issue was corrected in the browser’s nightly builds almost as soon as it was reported, these changes didn’t show up in official Brave releases until after the issue was brought to public attention on Twitter.
“Around 74.69% of Brave visitors are men.”
Maybe that’s why the author does not “get” Brave and relishes that thought of its downfall. Keep up these negative articles and you might get your wish. You go girl.