Leadership

CEO shares the 'only one right thing to do' when you fire employees

Max Levchin, co-founder of PayPal and Affirm
Contributor | Bloomberg | Getty Images
Max Levchin, co-founder of PayPal and Affirm

When Max Levchin is interviewing prospective managers, he always asks three questions: "Have you ever done a layoff? How'd you do it? How did it feel?"

"I want to know how you handled the period once you've told everyone," the co-founder of PayPal and online financial services firm Affirm tells Adam Bryant in an interview with The New York Times.

And according to Levchin, there's "only one right thing to do" after a layoff: You help people pack.

It's "the hardest thing anyone can do. Your stress level is high, and you just want to hang out in your office and wait for everyone to leave," says the CEO.

"But the right thing to do is to go be there with the people you just laid off and help them cope, help them pack and tell them that you're going to do your best to hire them back once the company's on good footing.

"It's about having compassion even when you feel you may not have the strength for it in the moment."

The single most important characteristic Levchin looks for in job candidates is perseverance in tough situations, such as during layoffs. "It's like the difference between endurance athletes and sprinters," he tells Bryant. "I think it is a really good predictor for how people behave under severe stress. … And so I look for endurance athletes, in the business sense."

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