Softbank-Backed Compass Lays Off 15% of Staff Amid Real Estate Downturn
Real estate startup Compass cuts 15% of its workforce and scales back its concierge business as the coronavirus pandemic causes a massive drop in home showings and revenue.
Softbank-backed real estate startup Compass lays off 15% of its staff as the global coronavirus pandemic causes major economic disruptions. Chief executive Robert Reffkin cites a 60 percent decline in real estate showings and projects a 50 percent drop in revenue over the next six months. In response to what he calls an "economic standstill," the company reduces its concierge business by 80 percent.
Executive leadership takes significant financial hits alongside the broader workforce reductions. Reffkin eliminates his own salary entirely and cuts the executive team's pay by 25 percent. Laid-off employees receive enhanced severance packages, COBRA health insurance coverage, and the ability to keep their company laptops while getting job placement assistance.
This downsizing at Compass reflects a much wider reckoning across the property technology sector. Competitors like Zillow, Opendoor, and Redfin pause their homebuying operations entirely due to state-mandated stay-at-home orders, while co-working startup Convene also implements layoffs. Despite the current market turmoil, Reffkin expresses optimism that the broader economy recovers within the next 100 days.