As mentioned, the foundation for maintaining the culture was laid far in advance. The tight relationships, respect/trust for each other, challenging and fun environment, were all things that we created from the beginning of the company.
If we hadn't of established those things I think everything would have fallen apart.
That being said, I think there are things you can do during and right after layoffs to ensure you don't damage your culture.
1. Make the layoffs swift, fair, and respectful. The longer you drag it out, the more damage you do.
2. Immediately after the layoffs get the group that remains together to explain what has happened. Reassure that there will be no more immediate layoffs to quell any fears.
3. Each manager after the group announcement should meet with their team members individually to give everyone to comment or ask questions they weren't comfortable with in front of the group
4. Focus on multiple social team events in the immediate couple weeks after. It is important that whoever is left gets use to the new smaller group.
5. Present a new plan of action as soon as possible to get focus and buy-in. More importantly show that you won't be repeating the same stuff that doesn't work.
6. Find and celebrate some "quick wins"
The goals of all your actions during and after layoffs is to build confidence in the leadership and team that is left.
To answer your second question, to my knowledge people stayed friends with those that got laid off. I still talk to many of them myself.
I hope this helps.
As a team we all still believed that we could accomplish big things together. On top of that, we didn't want to let each other down.
Like Brian pointed out, the culture was established at the beginning. Folks were recruited on how well they would gel and adopt a core set of values in addition to pure talent.
The virtual goods and social gaming market were crazy back then. It exploded and came out of nowhere. In amorphous but fast developing markets like that you need to maintain a structure that allows you to stay nimble in order to take advantages of opportunities quickly until you find "the one." We had taken money from the wrong investors, hired a couple of the wrong people in the senior leadership positions, etc that really restricted this.
