Redfin's CEO Glenn Kelman announced yesterday that 20% of Redfin's employees have been or are being laid off. While predicting a good October but rough waters ahead after October. The reasons given were major reversals in the last few weeks.
- stock market losses wiping out prospective down payments
- buyer tours and buyer offers down by 30%
- deals in escrow not closing due to a multitude of reasons including values not being there upon appraisals
Kelman offers that that Redfin expects to survive this tough market by allowing that even if their market shrunk in 1/2 - it would still be at 30 billion dollars a year. Also, Kelman allowed that Redfin had been working on a change in their service which Redfin intends to go ahead and launch in November despite the layoffs.
Kelman refers to the the Darwin theory of evolution in reference to business - in that those that are not adaptable to change will not survive - even if that adaptation includes laying off 20% of Redfin's employees.
Kelman notes that their website engineers and willingness to share more information with consumers, their goals to make real estate services better and cheaper and their appeal to the masses will help continue to keep Redfin in the market and growing.
This start up company is already laying off - is this market driven or product driven?
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