Opendoor co-founder and newly minted board chair Keith Rabois mentioned distant work and a “bloated” workforce have been a drag on the corporate’s tradition, as he vowed to slash headcount.
“There’s 1,400 employees at Opendoor. I don’t know what most of them do. We don’t need more than 200 of them,” Rabois informed CNBC’s “Squawk on the Street” on Friday.
The on-line actual property platform on Wednesday appointed former Shopify government Kaz Nejatian as its new CEO after investor stress induced his predecessor, Carrie Wheeler, to resign final month. Opendoor additionally named Rabois as chairman and mentioned Eric Wu, who served as the corporate’s first CEO earlier than stepping down in 2023, would return to the board.
The announcement despatched Opendoor shares hovering 78% on Thursday, earlier than the inventory slid greater than 12% on Friday. It’s nonetheless up nearly 500% this 12 months, after a military of retail traders pushed up the inventory worth when hedge fund supervisor Eric Jackson started touting the corporate.
Opendoor year-to-date inventory chart.
Opendoor’s business entails utilizing expertise to purchase and promote houses, pocketing the beneficial properties.
Nothing essentially improved for the corporate since Jackson purchased shares of Opendoor in July. Opendoor stays a cash-burning, low-margin enterprise with meager near-term development prospects.
Rabois mentioned he has a “high level view of the strategy” that is wanted to rework Opendoor, and that the headcount reductions are obligatory to resolve the corporate’s money burn.
“The culture was broken,” Rabois mentioned. “These people were working remotely. That doesn’t work. This company was founded on the principle of innovation and working together in person. We’re going to return to our roots.”
He added that Opendoor “went down this DEI path,” referring to range, fairness and inclusion.
“We’re gonna fix all that,” Rabois mentioned.