Rise score (0–100)

For each AI-native company in the Risers cohort:

rise_score =  0.12 · z(linkedin_momentum_%)   // live weekly LinkedIn hiring trend
            + 0.41 · z(headcount_30d_%)       // PDL
            + 0.29 · z(headcount_90d_%)       // PDL
            + 0.18 · z(funding_events_90d, weighted_by_amount)

then min-max normalize to 0–100 across the cohort for the week.

Cut score (0–100)

For each legacy SaaS incumbent in the Cuts cohort:

cut_score  =  0.40 · z(layoff_severity_90d)    // pct × recency × ai_attribution
            + 0.10 · z(-linkedin_momentum_%)   // live weekly LinkedIn shrinkage
            + 0.25 · z(-headcount_30d_%)       // PDL
            + 0.15 · z(-headcount_90d_%)       // PDL
            + 0.10 · at_risk_category_bonus

then min-max normalize to 0–100 across the cohort for the week.

Live headcount momentum (LinkedIn)

PDL's headcount data is authoritative but it lags ~2 months and only moves monthly — so on its own, the index would sit still between refreshes. To make the board reflect who is hiring or shrinking now, we layer in a second, faster headcount signal: a weekly LinkedIn-derived headcount series, tracked independently for every tracked company. Its week-over-week change is thelinkedin_momentum_%term in both formulas above.

It carries a deliberately small weight — 0.12 on the Rise side, 0.10 on the Cuts side. The series is young, so it nudges the board toward fresh movement without letting a couple of weeks of data overturn it. As the series deepens, that weight increases. Two principles keep it honest:

• Source-separated. The LinkedIn series is never mixed into the PDL headcount history. LinkedIn counts public profiles, PDL counts employees — different rulers — so they live in separate series, and only the week-over-week change feeds the score, never the absolute level.
• Validated, accepted-only. Every weekly reading is checked before it can score: zero or implausible values, namesake-company mismatches, and impossible week-over-week jumps are rejected. A company with no accepted reading simply gets no LinkedIn term that week, rather than a fabricated one.

Why a company's rank can move while its headcount looks flat: the headcount % shown on a company page is PDL's slower, official figure. The composite rank also reflects the faster LinkedIn momentum trend — so the two can legitimately diverge for a week or two until PDL catches up.

The pressure vs. efficiency split

A falling headcount at a legacy SaaS company isn't always the same story. Sometimes it's a company being disrupted by AI-native competitors. Sometimes it's a company using AI to run leaner — cutting roles while revenue grows. Both end up on the Cuts side of the index, but they mean very different things for investors, employees, and the market.

For every Cut, we classify the last 180 days of layoff announcements:

• Under pressure — layoffs announced with no AI-efficiency rationale in the majority of cases. Genuine AI disruption victims.
• AI efficiency — majority of recent layoffs explicitly attribute the cuts to AI productivity gains. Company restructuring around AI, not being displaced by it.
• Attrition only — contracting via hiring freezes or attrition, with no announced layoffs.

Next: weight the composite by revenue-per-employee trajectory (PDL inferred revenue, already ingested) and 30-day stock moves for public companies. A company shedding roles while revenue rises is a very different investment case from one where both are falling.

Does the index predict? (backtested July 2026)

We backtested the index's headcount backbone — the trailing-90-day change signal, deliberately excluding layoff terms so layoffs can't predict themselves — across Jan 2024 – Feb 2026 at monthly grain: 2,574 company-months. The question: do the companies the signal flags keep moving the same way over the following 90 days?

CUTS — P(sheds ≥5% of staff in the NEXT 90 days)
  cohort base rate                     6.8%
  flagged (worst-quintile decline)    23.1%   ×3.4 lift
  flagged two months running          24.7%   ×3.7 lift
  everyone else on the board           2.6%

RISERS — flagged growers averaged +28.7% next quarter
  vs +8.7% for the rest (3.3× the growth rate)

Honest limits: this is within our tracked cohort (selected in 2026, with hindsight), on PDL history as revised today, with overlapping 90-day windows (so observations aren't independent), and it validates the headcount backbone rather than every published rank. Which is why we don't ask you to trust the backtest: since July 2026 the flagged set is logged forward, in public, every Monday — and scored when the outcome lands. See the live track record.

Guardrails

• Headcount % changes are capped at ±50% to limit single-data-error blast radius.
• The LinkedIn momentum signal is validated per weekly reading — zeros, namesake mismatches, and implausible jumps are rejected — so one bad scrape can't move a score.
• Companies with <90 days of tracked history get a null score, not a forced zero.
• Companies with <50 employees are flagged "small base" and shown in a separate sub-bucket so noise doesn't dominate.

Data sources

• Headcount (backbone): People Data Labs Company Enrichment — monthlyemployee_count_by_monthseries, projected to weekly snapshots. PDL is the source of record for historical headcount, funding, and layoffs.
• Live headcount momentum: a weekly LinkedIn-derived headcount series, banked every Monday, kept source-separated from PDL and validated per reading (accepted-only). Used only as a week-over-week momentum signal, never as an absolute headcount.
• Layoffs: derived from PDLgross_departures_by_month— months where departures spike 2.5× above trailing 6-month median AND net headcount shrinks AND the excess exceeds 1.5% of workforce. Source URLs and AI-attribution filled in by news cross-reference when available.
• Funding: PDLfunding_details— amount, date, round type. Lead investor and source URL are intentionally not shown; PDL doesn't return a clean press-release URL or a reliable single-lead field, so rather than link to PDL's homepage or name a random angel as "lead," we show the round and nothing else. Press URLs will be filled in by the news classifier.

Refresh cadence: PDL ingest runs on the 1st of each month (PDL's underlying data moves monthly — weekly polling would be waste). The LinkedIn momentum series banks every Monday, and scoring re-runs every Monday to fold in that fresh momentum plus any funding or layoff events that landed between PDL refreshes. The "updated weekly" line in the footer refers to the scoring pass.