Another real estate tech startup is in trouble.
front deskThe startup, which manages more than 1,000 furnished apartments in the U.S., laid off its entire 200-person workforce on Tuesday after failing to raise more funding, TechCrunch learned exclusively from sources familiar with the company’s internal affairs. The massive layoffs come just seven months after the Milwaukee, Wisconsin-based startup acquired smaller rival Zencity.
The layoffs include full-time employees, part-time workers and contractors, Happened on Tuesday afternoon “A two-minute Google Meet call,” said one employee who participated in the virtual meeting.
On that call, the front-office CEO Jesse DePinto Tell employees that the front desk will apply state takeoverSources say this is an alternative to bankruptcy.
The company has not yet responded to a request for comment. When calling the number on the company’s website, a recording states: “Currently, the front desk is unavailable. If you have a reservation, please find alternative accommodation and we will contact you within the next two weeks.” If the company responds , TechCrunch will update this article.
Frontdesk, founded in 2017, has raised about $26 million from investors including JetBlue Ventures, Veritas Investments and Sand Hill Angels, according to Crunchbase.
Sources tell TechCrunch that Frontdesk has raised a bridge funding round to try to sell investors on a new plan for total construction management. The strategy didn’t work and the company couldn’t continue to operate. Frontdesk clearly remains optimistic about its ability to raise more funding; just two months ago, the startup posted multiple job openings on LinkedIn, including a chief of staff position.
The startup’s business model, which leases apartments at market rental rates and offers short-term rentals in more than 30 markets, has struggled, primarily due to the upfront costs involved, associated capital expenditures and changes in demand and interest rates. And changes in demand and interest rates are one of the main issues facing the company. sources said. Other companies in the space are also facing challenges, including Stay Alfred, Domio, lyrics, Zeus lifeGuild and WanderJaunt.
