US: Milwaukee-based short-term rental property management startup Frontdesk has reportedly laid off all of its staff and is facing imminent closure, according to a TechCrunch report.
As per the report, Frontdesk made its workforce of around 200 employees redundant yesterday [2 January] during a Google Meet call. During the call, it is believed that CEO Jesse DePinto told employees that the company would be filing for a state receivership, whereby a court appoints a neutral and independent third party to act on behalf, and for the benefit, of all relevant parties, and is seen as a potentially faster and cheaper alternative to bankruptcy.
Full-time and part-time workers and contractors are said to have been affected by the layoffs.
Bookings are currently unavailable on the Frontdesk website and a recording when phoning the company says: “Currently, Frontdesk is unavailable. If you have a reservation, please seek alternative accommodations and expect to be contacted within the next two weeks.”
The news comes just seven months after Frontdesk announced the acquisition of Chicago-based short-term rental operator Zencity in June, which also represented the former’s first-ever corporate acquisition. The purchase took Frontdesk’s portfolio to more than 1,000 furnished apartments in 30 markets across the United States and the brand had previously taken over the management of units left vacant by defunct operators WanderJaunt and Stay Alfred.
At the time of the Zencity acquisition, Frontdesk also hinted at plans to make further acquisitions as part of a strategic growth plan designed to leverage its proprietary technology and infrastructure.
Founded in 2017, Frontdesk had raised around $26 million in funding in total [including a $13 million Series B round in September 2022] but efforts to raise more capital through a bridge round ultimately failed to materialise. The company appeared to be optimistic about its future when posting for open roles via LinkedIn only two months ago.
STRz has approached Frontdesk for comment on the matter.
