Opendoor is letting go of about 550 people, or 18% of the company, across all functions, its co-founder and CEO Eric Wu announced in a blog post today.

The real estate technology company is one of many real estate tech companies that have had to lay off workers in 2022. Online mortgage lender Better.com has had multiple rounds of layoffs and in June, Redfin and Compass shed a combined 900+ workers.

Skyrocketing mortgage interest rates and inflation are largely to blame for the decreased demand that has led to slowdowns in business at such companies. For his part, Opendoor’s Wu said his company was navigating “one of the most challenging real estate markets in 40 years.”

In his blog post, the executive said that his company over the past two quarters had worked to reduce its operating expenses. He wrote: “Prior to today, we scaled back our capacity by over 830 positions – primarily by reducing third party resourcing – and we eliminated millions of fixed expenses. We did not make the decision to downsize the team today lightly but did so to ensure we can accomplish our mission for years to come.”

Impacted employees will receive ten weeks of severance pay, with an additional two weeks of pay for every full year beyond two years of tenure. All current healthcare benefits will remain active for the rest of the month, then Opendoor will pay for three months of health insurance. 

The company also plans to offer “job transition support” and launch an opt-in talent directory to help laid off team members “connect with new opportunities.”

Opendoor went public in late December 2020 after completing its planned merger with the SPAC Social Capital Hedosophia Holdings II, headed by investor Chamath Palihapitiya. The eight-year-old company first offered its stock to the public at $31.47 per share. At the time of writing today, shares were trading at $2.48, only slightly higher than the company’s 52-week low of $2.26. This means that the company is valued at just $1.56 billion, down from a valuation of $8 billion in 2021.

When it comes to venture capital, Opendoor last raised $300 million at a $3.5 billion pre-money valuation in March of 2019. Over time, it has raised about $1.3 billion in equity funding and nearly $3 billion in debt financing to finance its home purchases. Investors in the company include General Atlantic, the SoftBank Vision Fund, NEA, Norwest Venture Partners, GV, GGV Capital, Access Technology Ventures, SV Angel and Fifth Wall Ventures, along with others.

Founders include Eric Wu and Founders Fund general partner Keith Rabois.

Opendoor lays off about 550 employees, or 18% of its workforce by Mary Ann Azevedo originally published on TechCrunch