Rent-to-own startup Divvy Homes is laying off 94 employees, its third round of layoffs in the past year. The layoffs affect people working in a wide range of roles, including the vice presidents of sales, compliance, people and comms/PR as well as a senior recruiter, a number of software engineers and account executives.
The layoffs come as mortgage interest rates have continued to surge, making it more expensive for people to buy homes. Divvy Homes’ business model relies on buying homes for customers and then renting them back to them, so the rising interest rates have made it more difficult for the company to operate.
The layoffs represent a significant blow to Divvy Homes, which had raised over $400 million in funding from investors such as Tiger Global and SoftBank. The company had previously been valued at over $2 billion, but its valuation has likely declined in recent months due to the layoffs and the overall economic uncertainty.
It is not known how many employees remain at Divvy Homes after the latest round of layoffs. However, a source familiar with the company said that the layoffs made up almost half of the company’s workforce. This suggests that Divvy Homes may be struggling to survive in the current economic climate.
The layoffs at Divvy Homes are a sign of the tough times that many tech startups are facing. The rising interest rates have made it more difficult for startups to raise money, and they are also making it more difficult for startups to operate their businesses. As a result, we are likely to see more layoffs in the tech industry in the coming months.