Tailwind laid off 75% of the startup's engineering staff on Monday. The CEO blames AI.
“75% of our engineering team lost their jobs here yesterday due to the profound impact AI has had on our business,” CEO Adam Wasan said on GitHub, causing a stir in the tech community.
Like many startups, Tailwind has a small number of employees. In a podcast posted on X, Wasan said the company has four engineers. Well, there's one thing.
Wathan's post highlights the challenges that startups, whose odds of success are already slim, may face as AI models become more capable.
CEO founded Web Developer Tools in 2017. Tailwind's model is free and open source, with a paid “pro” tier driving the company's revenue. Wathan wrote in a comment on GitHub that AI is making Tailwind more popular, but its paying customer base is shrinking.
Traffic to Tailwind's online documentation has decreased by 40%, Wathan wrote. These resources were where people learned about paid tiers, which crushed their ability to generate revenue, the CEO wrote. Revenue was down 80%, he added.
According to the CEO, the remaining team after the layoffs will be three owners, one engineer and one part-time employee. “This is the only resource we have,” he said.
🎧 I recorded a new morning walk this morning. It's hard to share because I'm sure people will be clamoring for me, but I've been transparent so far, so I'll put it out there anyway. pic.twitter.com/lslaLp2gtf
— Adam Wathan (@adamwathan) January 7, 2026
Wasan said he spent his vacation forecasting revenue and realized the situation was “much worse than I thought.” The decline in revenue has been occurring over several years, Wethan said, but it has been gradual. Wasan said he predicted Tailwind would not be able to pay salaries within six months if nothing changes.
Mr Wasan said the job cuts were a “cruel decision”. “If we don't do it now, we won't be able to give people good retirement benefits,” he said.
“I feel like I should have done it and I failed,” Wasan said. “It's not good.”
Tailwind is popular among developers, and Wathan's post sparked reactions from the tech community on social media, some of whom accused the CEO of being responsible for the company's declining revenue.
One X user wrote that he had only received five promotional emails from Tailwind in 2025, to which Wasan responded, “We don't send enough emails.” “I definitely need to get better.”
Another X user wrote that Tailwind relies on a business model of selling UI components, with free components and AI-generated equivalents growing.
“To this day, we don't know what to focus on, so it just makes sense to do something that is at least a little bit effective in the meantime,” Wasan replied.
Wasan said on the podcast that 90% of people understand but don't “stack on top of it,” but there are some who do. As an employer, he said, he carried the burden of the world “hating you and thinking you're the bad guy.”
Some expressed support online. Josh Puckett, a Dropbox and Groupon alumnus, called the podcast “a surprisingly raw and honest account from one of the industry's best about the realities of running a business in the midst of AI-driven disruption.”
AI’s ability to summarize and extract information, sometimes without directing users to specific sites or documents, threatens many businesses that rely on online traffic. The media industry is well aware of this, and many startups have been formed around the concept of “Google Zero.”
That's basically what happened to Tailwind. According to the CEO, they needed traffic to convert free users into paying customers, and AI effectively crushed that traffic. Still, Wasan is hopeful about the company's future.
“I'm still optimistic,” he said on the podcast. “My job requires me to be optimistic.”
