Opendoor, the startup that operates an online platform for buying and selling homes, “is reshuffling staff and scaling back on a time-honored startup perk: free lunch,” according to a report from Bloomberg.
The report went on to say that “Opendoor, most recently valued at $3.8 billion, began firing almost 50 of its roughly 1,300 employees in June, according to people familiar with the matter. It has also asked between 200 and 300 people in offices across the country to relocate to its Phoenix location, said the people, all of whom asked not to be identified because the company is private.”
A company spokesperson told Bloomberg that Opendoor was “streamlining operations in our Phoenix office” as a way to improve customer service. Not only that, but “Opendoor has ended its policy of offering free lunch, according to the people.”
Earlier this year, Opendoor raised $300 million. The company has raised $1.3 billion in equity, with $3 billion in debt financing used to buy homes. The funding underscores investors’ interest in real estate, as well as the attractiveness of startups that are disrupting the traditional market.
Aiming to shake up the real estate market, Opendoor relies on data modeling to pinpoint opportunities to take advantage of gaps in the market and to price the properties correctly. That increases the predictability of selling properties the startup acquires and protects it during downturns.
According to the Bloomberg report, “as the company has grown at a rapid clip over the last several years, it has also not appeared to shy away from spending. At a recent National Association of Real Estate Editors conference, Opendoor gave away a gift bag that included branded Apple AirPods and a jar of barbecue rub.”