Compass, a real estate company, cut jobs on Tuesday as part of a plan to cut costs “significantly” by the end of the year to weather a simultaneous recession in the housing and technology sectors. The layoffs will focus on the company’s technical team, according to a company spokesperson who confirmed the layoffs.
“These cuts are difficult, but ultimately necessary to enable us to navigate the current market with confidence,” CEO Robert Lefkin wrote in an email announcing the layoffs on Tuesday. increase.
Have you ever worked at Compass? I would like to talk to you. From a non-working device, please contact reporters at [email protected] or via Signal at 310-614-3752 for added security.
The company said in its earnings call last month that it intends to cut costs significantly in the second half of the year as part of its commitment to be cash flow positive by 2033. But he said he hopes Tuesday’s cost cuts and the company’s broader cost-cutting plans will give those who remain “confident about the path forward.”
The housing company did not disclose the scale of the job cuts, and Mr. Lefkin said in an email that it would not affect employees at local businesses.
Compass has long been pitched to investors as a tech-savvy alternative to traditional real estate brokers. This is the main reason he was able to attract over $1 billion in private investment before Compass went public last year.
To some, Tuesday’s drastic cuts to the tech team seem to acknowledge that the company is no longer the tech company it once was.
However, company management believes that with the end-to-end platform complete, Compass’s technical team won’t need as many employees. This enables agents to use the platform at every step of the transaction, from initial client contact to closing. A company spokesperson said he added more than 700 people remained on the tech team after the layoffs.
Some employees at the company are unconvinced by the claims and have told Motherboard they believe the platform is flawed and incomplete.
This post has been updated with more details about the company’s end-to-end technology platform.
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