In a shocking turn of events, online rental platform Frontdesk has made headlines as the first tech startup to initiate mass layoffs in 2024. The proptech company reportedly laid off its entire 200-person workforce during a succinct two-minute Google Meet call, including full-time employees, part-time workers, and contractors. The drastic measure has left Frontdesk on the brink of closure, as reported by TechCrunch on Wednesday.
Frontdesk CEO, Jesse DePinto, conveyed the grim news to employees, stating that the company would be “filing for a state receivership, an alternative to bankruptcy.” This unexpected move has sent ripples through the startup community, prompting discussions about the challenges faced by emerging tech companies, particularly those in the proptech sector.
Founded in 2017, Frontdesk specialized in managing over 1,000 furnished apartments across the United States. Despite raising approximately $26 million from notable investors such as JetBlue Ventures, Veritas Investments, and Sand Hill Angels, the startup failed in its recent attempt to secure additional capital, leading to the drastic decision of laying off its entire workforce.
“Frontdesk was apparently still optimistic about its ability to raise more capital; the startup had posted on LinkedIn openings for several jobs, including a chief of staff role, just two months ago,” noted TechCrunch in its report, highlighting the suddenness of the layoffs despite recent recruitment efforts.
The move by Frontdesk adds to the rising statistics of global tech layoffs over the last two years, with more than 425,000 employees affected worldwide. India alone witnessed over 36,000 tech-related job terminations during the same period. In 2023, the global technology and startup sector saw nearly 2.6 lakh employees being laid off, underlining the impact of macroeconomic conditions on the industry.
