Insurtech Lemonade’s Co-Founder Accuses Amazon of Poaching Employees
With two social media posts, Shai Wininger, co-founder of the insurtech Lemonade, accused giant Amazon of poaching employees of his startup insurance carrier that is powered by artificial intelligence and behavioral economics.
Wininger also threatened to retaliate by leaving the Amazon’s AWS cloud platform.
On LinkedIn last week, Wininger posted: “Just learned that Amazon is actively targeting and trying to poach Lemonade Inc. employees. I wonder if that’s their idea of supporting the startup ecosystem. Reconsidering Amazon AWS.”
On his Facebook page, Wininger wrote: “Just learned that Amazon.com is actively trying to poach Lemonade employees. Game on! Werner Vogels FYI.”
Vogels is a vice president and the chief technology officer of Amazon.
The LinkedIn post first came to Carrier Management’s attention last Friday, when some of Carrier Management’s connections commented and liked the post. As of Monday, the post has over 400 likes and almost 100 comments, with commentators split between those giving social media high-fives to the Lemonade executive and those suggesting that “poaching” is simply a fact of life in the business world. Among the latter group, some suggested that Wininger is confusing “poaching” with “recruiting,” saying that when companies keep employees happy, they don’t respond to overtures from competitors.
“Sometimes life gives you lemons Shai,” one poster said.
The LinkedIn debate prompted a response from Wininger. “I think some of you guys are missing the point here,” he wrote. “Amazon claims that it’s in their interest to support the startup ecosystem. It makes sense because companies like Lemonade spend millions in cloud services with them and trust them with their business. Poaching employees from their customers is a breach of confidence. But it doesn’t end there. The way they do it is by offering candidates obscene amounts of money which confuse even the most loyal employee, not to mention the damage this causes to the entire market. Amazon needs to decide where it stands, and it needs to happen fast.”
On Facebook, there was a similar debate but with an interesting wrinkle—a response from Amazon’s Vogels appeared among the comments.
Vogels posted: “Let me dive into this. It may be a sourcing agency vs Amazon proper. I find that sourcing from our customers would be extremely counter-effective….”
The Amazon CTO’s explanation prompted critical reactions from other technology executives in Wininger’s camp.
Amid the mainly positive reactions to his Facebook post, Wininger published a lengthy philosophical comment a few days after his initial post, starting out by seemingly clarifying that the Amazon activity was directed at Lemonade employees in Israel.
“Those of you who know me, know I’ve been deeply concerned about Amazon’s aggressive approach, far beyond Lemonade specifically, and that if it doesn’t stop, we may look back at this moment a few years from know [SIC] and say that this was a defining moment that changed Israel’s competitive advantage forever,” he wrote, going on to express his love of Israel and his solidarity with other tech entrepreneurs in that country. (Editor’s Note: While Lemonade’s LinkedIn page indicates that the company’s location is New York, Wininger’s personal LinkedIn page puts him in Israel. According to a communications office at Lemonade, while the company is headquartered in New York, its R&D teams are based in an office in Tel Aviv.)
In the 363-word reaction, Wininger presented what he termed “ethical” and “existential” arguments.
Opining that “the way things are done is every bit important as the act itself,” the Lemonade executive questioned the ethics of buying “a home in a quiet, friendly neighborhood” with the intent of becoming “a pillar of that community,” and then going around “tearing your neighbors’ houses to the ground, just to make some room for your new tennis court and pool.”
Going on to characterize offers of “100k/mo developer salaries” as “a cheap trick,” Wininger returned to his concern for Israel’s technology ecosystem and “the potential destructive force of introducing a new, 3X salary standard into a small market.”
“I have a grave existential concern for many startups that will not have the capital required to hire employees in Israel and will fail to be competitive in the global marketplace. Unless of course, they’ll set up shop somewhere else.”
Still, the commenters who disagreed with Wininger focused on his threat to abandon the Amazon cloud and the idea that satisfied employees don’t wander. One noted that Google and Facebook might also poach Lemonade employees at some point, suggesting that the activity likely wouldn’t prompt Lemonade to stop using Gmail or advertising on Facebook.
This article was originally published by Carrier Management, Wells Media’s publication for the property/casualty insurer C-suite. Sclafane is senior editor of Carrier Management.