Meanwhile, Opendoor has named former Shopify executive Kaz Nejatian the company’s new CEO. This decision follows Carrie Wheeler’s recent resignation under the pressure of investors last month. This leadership change comes at a pivotal time for the company. Now, it faces large scale operational challenges and is in the midst of criticism over the size of its workforce.
The announcement of Nejatian’s appointment led to a dramatic 78% surge in Opendoor’s shares on Thursday. Turns out, the giddyness was premature, as BABA’s stock fell over 12% the next day. Even with this volatility, Opendoor’s stock is still up nearly 500% on the year.
Having about 1,400 employees on its payroll as of the third quarter, Opendoor is feeling the market’s heat to trim the fat. Chairman Keith Rabois hasn’t been shy about his desire for deep, deep cuts in headcount. This smart action will address the firm’s notorious cash burn and increase efficiency across the board. He suggested Opendoor’s current size as an unusual example—almost 1,400 employees. He doesn’t know what everyone’s roles would be and is convinced that they only need 200 or so.
Rabois stressed the importance of restoring a culture of merit and excellence in the company’s ranks. He derided the existing remote work model and described the workforce as “bloated.” He raised concerns that these matters are toxic to Opendoor’s corporate culture.
“The culture was broken. We’re gonna fix all that.” – Keith Rabois
Make no mistake—Rabois is spearheading a transformation campaign. They’re looking to execute a strategy that reduces stress across the organization while reducing headcount and developing a more efficient workplace culture. He possesses a razor sharp perspective on the approach that can make Opendoor a breakout strategy. His leadership will help make the company MySpace more nimble and profitable.
The business model behind the company is using technology to rapidly flip homes for public profit while socializing the risk. These impending changes will undoubtedly go hand-in-hand with Rabois’s plan for reenergizing Opendoor’s business model. They will inevitably contribute to improving the company’s operational efficiency.
Nejatian’s appointment is an interesting and radical shift for the company. Eric Wu, Opendoor’s founding CEO, will re-join the board, providing strong leadership as they work their way through this transition.