Another proptech company got into difficulties.
Eltrys exclusively heard from individuals familiar with the firm that Frontdesk, a startup that handled more than 1,000 furnished homes throughout the US, laid off its entire 200-person crew Tuesday after failing to acquire fresh money. The Milwaukee startup purchased Zencity seven months before the major layoff.
The layoffs of full-time, part-time, and contractors occurred Tuesday afternoon during “a two-minute Google Meet call,” according to one employee.
According to reports, Frontdesk CEO Jesse DePinto informed employees that the company would file for a state receivership instead of bankruptcy during that conversation.
The corporation ignored a request for comment. “Currently, Frontdesk is unavailable” plays while phoning Frontdesk’s website number. Please find alternate lodgings and expect a call within two weeks if you have a reservation.” Eltrys will update the article if the firm responds.
According to Crunchbase, JetBlue Ventures, Veritas Investments, and Sand Hill Angels invested $26 million in the 2017 startup Frontdesk.
Sources informed Eltrys that Frontdesk sought a bridge round to convince investors of its new comprehensive building management strategy. That strategy failed, and the firm closed. Two months ago, Frontdesk listed job positions on LinkedIn, including a chief of staff position, indicating that the business was still confident about raising further funding.
According to insiders, the business was unable to rent several houses and had “little to no communication with” the apparently irate landlords.
One source claimed the startup’s business model, which leases flats at market rates and furnishes them for short-term rentals in more than 30 countries, has suffered owing to upfront fees, construction expenditures, and demand and pricing fluctuations. Stay Alfred, Domio, Lyric, Zeus Living, The Guild, and WanderJaunt also struggled. Ironically, Frontdesk bought over 100 units from WanderJaunt, Stay Alfred, Lyric, and Domio in many cities.
