IgniteTech CEO Eric Vaughan axed 80% of his staff in 2023, a move he attributes to the rise of artificial intelligence. The news grabbed headlines, sending chills across the tech industry.
Two years later, Vaughan said he’s do it again.
Speaking with Fortune, Vaughan touted his philosophy of AI-driven efficiency. He argued that AI has eliminated the need for a large workforce at his software company. His bold stance, which reduced staff to the bare minimum, positions IgniteTech as one of the most extreme examples of AI’s disruptive power.
The monumental pivot instantly transformed the company into an “AI-first” firm, focusing the remaining workers on AI innovation.
A tale of resistance
From 2023 to early 2024, IgniteTech laid off employees who resisted AI adoption, a process Vaughan said occurred in batches. The company’s actions were swift and paid off, while many others were still experimenting with AI’s enterprise capabilities.
He further revealed his surprise upon discovering that technical teams showed greater resistance than non-technical ones. Their concerns revolved around the potential limitations of these AI tools in handling highly technical responsibilities.
The notion that AI cannot handle technical tasks efficiently is common among technical teams. Despite the rise of autonomous automation tools and coding agents, there has been increasing criticism of their use by technical professionals. As a result, it’s not surprising that non-technical teams whose work is more routine would be more inclined to adopt AI than their technical counterparts.
Research from Writer found that nearly 31% of employees reported taking actions that ran counter to their company’s plan to adopt AI. Some actions theyve taken to sabotage their company’s AI rollout include:
- Complete refusal to use the AI tools provided by the company
- Intentionally producing poor-quality work to make it appear the AI is not useful.
- Skipping training sessions on how to use these AI tools.
- Using non-approved AI tools.
The report further revealed that this number increased to 41% among Gen Z and millennials. According to the report, the sabotage stems from respondents’ fear that these tools will completely replace them. Vaughan disagrees and instead chooses to retain those with less AI resistance.
According to Fortune, Kevin Chung, chief strategy officer for Writer, shared the “big-eye opening thing” from the research:
He believes that they are not sabotaging their company’s AI rollout because they are afraid of the technology. Speaking to Fortune, he said: “It’s more like there is so much pressure to get it right, and then when you’re handed something that doesn’t work, you get frustrated.”
Further speaking on the matter, he emphasized that workers distrust their company’s direction regarding AI, hence the sabotage.
‘You can’t compel people to change’
When speaking about the drastic reduction in workforce, he said, “You can’t compel people to change, especially if they don’t believe.” Vaughan claimed that the layoffs were painful and temporarily disorganized, and that they transformed the company, something he called “somewhat unusual.”
The disorganization required IgniteTech’s leadership to change its recruiting style to focus more on AI-innovative roles. Every major department, from sales to finance, marketing, and engineering, was affected by it.
The result of this change was immensely profitable — a motivation for his fixed stance on going through that stage again, if need be.
The CEO reported that as of the end of 2024, barely a year after the layoffs ended, the company:
- Launched two new AI products strong enough to be filed for patents.
- One of these products is Eloquens AI, an AI-powered email automation tool.
- Acquired a new platform, Khoros.
Its financial strength remained solid, running into nine figures (at least, $100 million). A profitability of 75% on Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) suggests that AI incorporation allowed them to retain most of their profits after operating costs.
Vaughan is confident in the company’s ability to build customer-ready products within four days, a speed he said was impossible prior to 2023. However, this is a high-risk move, since over half of the companies that lay off employees due to AI later regret it.
The importance of reskilling
With millions of workers still living in uncertainty about their job security, companies like IgniteTech are already moving fast. Despite employee skepticism, many companies remain focused on profit.
For workers, cases like IgniteTech underscore a clear takeaway: reskilling with AI is one of the most effective ways to stay competitive, especially as many employers now offer those opportunities. As Joshua Wöhle put it in a LinkedIn post, “argumentation beats automation,” meaning human judgment and critical thinking remain valuable even as AI accelerates the work.
Also read: TechRepublic’s tech predictions for 2026 outline what enterprise leaders are watching next.
