New Delhi: Frontdesk, a proptech startup overseeing more than 1,000 furnished apartments across the United States, terminated its entire staff of 200 on Tuesday due to unsuccessful attempts of securing additional capital, as reported by sources to TechCrunch.
On Tuesday afternoon, Frontdesk CEO Jesse DePinto reportedly fired all employees in a brief two-minute Google Meet call. An employee who participated in the virtual meeting shared information about the meeting with TechCrunch. (Also Read: Ayodhya Real Estate Booms Ahead Of Ram Mandir Inauguration)
As per the report, Frontdesk CEO Jesse DePinto informed employees that the company intends to file for a state receivership which is an alternative to bankruptcy, according to sources.
As of now, there has been no response from the company to a request for comment. TechCrunch reported that upon dialing the number listed on Frontdesk’s website, a recorded message states: “Frontdesk is currently unavailable. If you have a reservation, please arrange for alternative accommodations and anticipate contact within the next two weeks.”
The layoffs which involved full-time, part-time employees, and contractors occurred seven months after the acquisition of smaller competitor Zencity by the Milwaukee, Wisconsin-based startup. Established in 2017, Frontdesk had secured approximately $26 million in funding from investors including JetBlue Ventures, Veritas Investments, and Sand Hill Angels, as per Crunchbase.
The report stated that Frontdesk pursued a bridge round aiming to persuade investors with a new strategy focusing on full building management. Unfortunately, the plan was unsuccessful leading to the company’s inability to sustain its operations.
The company not only struggled to meet rental payments for several properties but also had minimal communication with reportedly infuriated landlords, according to sources.
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