The Day I Lost my Job at Microsoft

Sometimes bad things happen so that good things can happen

Carlos Arguelles
Nerd For Tech
11 min readSep 14, 2021


My “Microsoft Ship It” — every time you shipped a product, you’d get a little metal plate to stick on your award

I inhaled sharply as I got to the conference room. The night before, when I saw an invite for a meeting early in the morning with HR and my boss and a nondescript subject I knew exactly what was going to happen. 2008 had been a lousy year: the housing bubble, the subprime crisis, banks collapsing everywhere. Microsoft was in trouble. I was about to lose my job, in the middle of one of the worst global recessions in history, after 11 years at Microsoft. 5000 other Microsoft engineers were going to as well. I smiled weakly as I entered the room.

I wanted to write this story for three main reasons.

  • I think there’s a stigma to having been laid off. I want to challenge that. I ended up being part of a mass 5000 person layoff at Microsoft on January 22, 2009. It wasn’t because of my performance: I had just been promoted two months prior. And life turned out just fine: I’ve grown six Microsoft levels since.
  • I strongly believe that sometimes bad things happen so good things can happen. In my case, getting laid off at Microsoft led me to Amazon, where I embarked in an 11-yr journey that changed my life.
  • Only during the soul searching that the prospect of unemployment forced upon me did I truly understand that I had let fear and inertia drag me into stasis. I had not grown in my career in years. This gave me determination and energy to super-charge my career when I joined Amazon. I was too scared to leave Microsoft yet I was so deeply unhappy.

The truth is, I hated Microsoft.

I didn’t always hate Microsoft, though. When I joined in 1997, as a hire straight out of college, it was the most amazing place to be. There was so much energy and talent everywhere. Microsoft could do no wrong. I was proud to be a part of it all. The stock was growing and splitting at a breakneck pace. I wrote several nostalgic stories in my blog about the good old days at Microsoft, like “Memories from working at Microsoft in the nineties”, “The night I pulled an all-nighter for Bill Gates” and “Bunnies and Bees, Patenting at Microsoft.”

I am very thankful for what Microsoft taught me. My first five years at Microsoft were critical in shaping me as a professional software engineer. In college, you work on little projects for a week or two, hand them over, get a grade, move on. Sometimes you work in teams, most of the times you work alone. If you make a bad technical choice, you generally don’t have to deal with its repercussions for years. But when I joined Microsoft in 1997, all of a sudden I was thrown into the massive codebase of Microsoft Office and Microsoft Windows and I was contributing code among thousands of engineers on multi-year projects where billions of dollars were at stake. I was also surrounded by some of the smartest software engineers in the world, much, much smarter than me all around. I was so alive, soaking it all up. I was definitely not in Kansas anymore.

Yet the company decline started when Bill Gates handed over the keys to Steve Ballmer. We called it the Lost Decade. Steve had an awful business acumen and embarked in a series of ill-fated acquisitions, like 7 billion dollars down the drain buying Nokia’s handset business. Steve also oozed testosterone and encouraged and rewarded competition, both internally and externally, so he (maybe unknowingly?) fomented a culture of backstabbing and cutthroat actions. The place was poisonous. Microsoft was very, very sick. And it showed in its stock price, stagnant for a decade, as well as in its non inspiring software releases. While Apple was wowing the world with the iPod, and the iPhone, Microsoft was launching a bug-ridden, lackluster, Windows Vista.

[Before I get angry comments from current microsofties, I love how Satya Nadella has turned the company around. It’s an entirely different world! But Steve was not great for the company, and that decade was not Microsoft’s finest moment].

In 2007, I joined Microsoft’s Rich Media Group (RMG). RMG was a team working on photography-related software, and photography was a hobby of mine, so combining a hobby with my day job seemed fun. I had no shortage of passion for the space!

I had failed to take into account some headwind though.

First of all, indiscriminately funding a space is a dangerous thing, and the team was actually over-funded.

Amazon (the company I would join after leaving Microsoft) gets this, to the point they selected “ Frugality” as one of the Leadership Principles that codify Amazon’s DNA. The official description states, “Accomplish more with less. Constraints breed resourcefulness, self-sufficiency, and invention. There are no extra points for growing headcount, budget size, or fixed expense.” Frugality is Amazon’s least popular leadership principle, as it’s often used to justify being frupid. Yes, Amazon is miserably cheap in so many aspects, but there is a lot of wisdom behind that leadership principle. Getting less resources that you want to build something is a forcing function to be laser-focused on the things that matter, and incrementally build value to earn trust.

Microsoft’s RMG provided a textbook case study on the opposite. We were going to compete with Adobe Lightroom. Adobe built it in 18 months with 18 engineers? Well we were going to throw 35 people at the problem! There was an impressive cast of Senior and Principal Engineers that essentially spent two years debating each other and bike shedding and ended up shipping exactly zero code. Even within just those 35 engineers there were little fiefdoms. We even started buying companies to “accelerate” the process. None of these acquisitions actually achieved anything other than adding organizational drag. I strongly believe today that if we had funded a team half the size, we would have shipped an actual product.

We had so much disposable cash we created a program called “Icons of Imaging” where we partnered with world-class photographers like Bambi Cantrell, Reed Hoffmann, Denis Reggie, John Shaw, Matthew Jordan Smith and Art Wolfe. One lucky member of our team got to travel to Antarctica with Art Wolfe to shoot the public television series Travels to the Edge. We spent an afternoon doing a private shoot with Bambi Cantrell. We had a lab stuffed with high end printers (in the tens of thousands of dollars) so that we could test the product’s printing capabilities. We had a full collection of Canon “L” lenses that we could borrow anytime, like the $2000 70–200mm f/2.8L. Photography was my hobby, so in a lot of ways the perks of the job made it a dream job.

But in terms of software engineering, I learned nothing. I didn’t grow my career. The team was doomed from the start. The fact I was having so much fun with all the perks obscured this fact for a long time.

The second headwind I failed to take into account is that we simply didn’t have it in our corporate DNA to make the right product.

Companies have specific things they do extremely well. Apple does beautiful designs. Microsoft does serious enterprise. Amazon does web services. Google does crazy scale. Once these companies venture away from their core DNA, they are a bit shakier, out of their comfort zone. Amazon’s Alexa is a great product but does not have an Apple-like device beauty. At the same time, I wouldn’t generally expect a web service from Apple to exhibit the same robustness of Amazon AWS. This isn’t to say Apple can’t do great web services, or Amazon can’t do beautiful interfaces, but it does go against their core DNA so there’s headwind there.

In the case of photography and art, Adobe was king of the castle. It was in their core DNA. It was something they had been doing for decades. Photoshop, Illustrator, and Lightroom were amazingly beautiful. If you’re building a product for photographers or artists, this sort of beauty and creativeness will attract them.

Instead, Microsoft had Windows and Office… utilitarian and corporate. I use a Mac today, and every time I look at Microsoft Windows I gag. It’s so business-like and serious. There’s zero playfulness to the user interaction.

I had that epiphany in Köln (Cologne), Germany, in September of 2008. We were at Photokina, a well-known tradeshow in the photo industry, to unveil a thing we had built called Microsoft Pro Photo Tools. All the big players were there too. We set up our booth right next to Adobe’s. Our DNA differences couldn’t have been more clear — you could literally look at one booth, then the other one, back and forth. Even their booth was beautiful, with bold primary colors, artsy curves, very playful and inviting. Our booth was black and white, sharp angles, and painfully corporate-looking. We were boring enterprise dudes, they were fun.

Yours truly at Photokina, Köln, Germany, 2008

Hindsight is always 20/20. I can see now, so clearly, that I was wasting my time on a product that was never going to succeed: we were overfunded to build something significantly outside of our DNA.

With that same 20/20 hindsight I can also see my own flaws and mistakes. I deeply disliked the company that Microsoft had become, but I was too lazy and scared to actually leave Microsoft. So I stayed, a few too many years, unhappy but not doing anything to address that unhappiness. The prospect of jumping into the unknown scared me to death. It was that same feeling you get when you stare at a pool that you’re about to jump into, and you know the water is going to be freezing. What if I failed? I knew my situation wasn’t great, but I also knew I could navigate the company and continue being mediocre there. I’ve said it: I was, truly, mediocre. Low risk, low reward. My last 2 years at Microsoft I did nothing to advance. Microsoft went from being a career to becoming just a paycheck. I don’t know why I let myself go like that. I was meant to do much, much better than that with my life, but I got lost along the way for a while.

Something else I want to highlight. Despite all its sins, Microsoft was still a great place to work. I was still surrounded by amazingly smart people. I still had top notch educational opportunities all around me. I could have, and should have, taken better advantage of my environment. There was a huge amount of privilege that I was too spoiled to appreciate. That I fell into complacency and I took a lot of this for granted is my miss. Thought exercise for you: ask yourself, if I lost my job today, would I regret not having taken advantage of the opportunities this job gave me, every single day? Being surrounded by smart people is always a privilege, embrace it!

Where I personally was mentally and emotionally, getting laid off was, simply put, the best thing that ever happened to me. I needed that slap-in-the-face to react, to get back up, dust myself off, and do better.

The irony is, just a month earlier, I had decided that I was going to leave. Every year, on December 31st, I spend a couple of hours soul-searching, thinking about what I accomplished that year, where I have been, where I am going, etc. December 31st, 2008, I took a hard look at myself. This wasn’t who I was meant to be, I reflected. I needed to leave the company, take some risks, and put myself in an entirely different culture. Stop being so afraid of failure. I polished up my resume, sent it to Amazon and Google (the other two big employers in the Seattle metropolitan area back then), and started practicing coding questions with a $20 whiteboard I bought at Target. So by the time I had that dreaded meeting with HR and my boss in January to let me know my employment had been terminated, I was mentally and emotionally ready to move on. Scared, yes, very much. But ready.

I also knew that the layoffs were going to happen. There had been rumors floating around Microsoft’s Redmond campus for a couple of months. My team had wasted two years without releasing a product to market. We were all clear candidates for layoffs. It wasn’t personal.

My manager was a really good guy. He cried that day as he was giving me the news. He had fought long and hard to spare me. We’re still good friends.

To their credit, Microsoft did take really good care of me. Losing your job in the middle of a recession is scary. I walked away with 8 months of severance in a lump sum. That was very generous. My wife and I were also very frugal so we had some savings, and could comfortably survive for a year if necessary. That removed a lot of pressure. Other microsofties that had been living significantly beyond their means were desperate to take any job they could, as soon as they could. I took my time, practiced coding interview questions full time for a month, and went through full loops at Amazon and Google. I ended up getting offers from both, significantly above what I was making at Microsoft.

I chose Amazon. It was 2009, and I was romanced by the idea of AWS. It was in its infancy then, but I knew it was going to change the world, and I wanted to be a part of it while it was still early. I spent 11 years at Amazon, grew from a Microsoft low level 62 to a Microsoft high level 67 equivalent while at Amazon, and worked hard, had fun and made history. I was promoted to Principal in 2014.

My career growth was significantly faster at Amazon than at Microsoft. I spent the same amount of time in both companies, but the Amazon culture just fit with me better.

In 2020, I decided to go back to the path-not-taken in 2009… I joined Google, where I’ve happily been a Senior Staff Engineer since.

Thinking back… on January 22, 2009, as I nervously walked into that room where HR and my manager were waiting for me, it felt that losing my job, in the middle of a recession, future uncertain, was the worst thing that could happen to me. But, it turned out to be the best thing that happened to me. I needed that bump to put me on the path that took me to who I am today. And, I like who I am today and what I’ve done with my life.

I hope this little story inspires you if you ever find yourself in a situation like mine — just remember there’s always a silver lining in whatever happens, and embrace where serendipity might take you!



Carlos Arguelles
Nerd For Tech

Hi! I'm a Senior Principal Engineer (L8) at Amazon. In the last 26 years, I've worked at Google and Microsoft as well.