
Opendoor is cutting 35% of its employees - MLEnthusiast
https://techcrunch.com/2020/04/15/softbank-backed-opendoor-has-announced-a-massive-layoff-cutting-35-of-its-employees/
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jacknews
I keep seeing "SoftBank-backed ..." in TC headlines, but rarely other funds.
Is it just fashionable to bash SoftBank?

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Icathian
Yes it is. They backed a couple hilariously bad bets in a big, public way, and
people like feeling smarter than rich strangers.

I would be curious, though, if there are other funds with similar scope and
track records to Vision 1 that have just managed to skate under public
scrutiny thus far.

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rchaud
> They backed a couple hilariously bad bets in a big, public way, and people
> like feeling smarter than rich strangers.

The two things are related. The public visions for these companies went beyond
the standard startup platitudes about 'making the world a better place'.
Regular people can see through that, because they don't live in an SV bubble
where playing along with this sort of hubris is encouraged.

I don't think anyone thinks they're smarter than Softbank or Adam Neumann.
They may just be enjoying the schadenfreude of this hubris come crashing back
to earth once reality entered the picture.

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dntrkv
> I don't think anyone thinks they're smarter than Softbank or Adam Neumann.

With all the armchair investing going on, you would think otherwise.

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adrr
All the ibuyer companies won't make it. Nationwide downturn in house prices
and all the inventory these companies are holding are underwater. Zillow and
Redfin are more than likely done. Zillow maybe holding 60,000 homes.

We never learn our lesson. GE was taken out by their financial division and
high risk bets.

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rubidium
“ Nationwide downturn in house prices” there’s nothing certain about that
happening. Look at 2001. It may.. but all the free money being thrown will
prop up prices some. Plus supply in the tank because people aren’t moving.

[https://www.calculatedriskblog.com/2018/06/real-house-
prices...](https://www.calculatedriskblog.com/2018/06/real-house-prices-and-
price-to-rent.html?m=1)

~~~
adrr
Lenders have already tightened up loan requirements which will decrease the
demand part of the equation. It is the same thing that happened during the
great recession. People may want to buy, but have no ability to do so. There's
also the high unemployment rate and foreign investors liquidating inventory
for capital because their country is also going through a downturn. All the
ibuyers have stopped purchasing. If the stock market drops, 10% of buyers who
use their 401k or IRA for their downpayment will probably dry up.

I don't see any situation where the housing market doesn't drop.

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pixl97
That said I believe the drop after 2008 should have been more significant. The
massive amount of cash the government pumps into markets, it allows massive
amounts of dark/shadow inventory that would cause further price drops if the
market was transparent.

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heyflyguy
I feel like the amount of subliminal shitposting within an article is
increasing as this goes on. What did that sentence about Florida have to do
with anything? They are on a statewide lockdown.

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Hendrikto
> They are on a statewide lockdown.

Apparently not. But I agree this remark is out of place.

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stronglikedan
What makes you think they aren't? The statewide lockdown was announced a while
ago, and as far as I know, has not been lifted.

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dfxm12
The fact that they deemed live pro wrestling an "essential business" is one
thing that shows they might not be taking their statewide "lockdown"
seriously.

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anticsapp
Can I ask a stupid question?' I kind of did a Rip Van Winkle and stopped
reading Techcrunch for eight years. Back in the day I would email Alexia and
she would take the story tip and write a cool article. Is TC 100% pay to play
nowadays? I know so many people who submit press releases to them and they get
auto-deleted. What gives?

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1cvmask
I don’t know much about their readership numbers but I stopped reading them as
well roughly 8 or so years ago. Maybe their readership broadened and even
increased?

~~~
anticsapp
It's still good but it seems more like focusing on publicly traded companies.
I'm not bashing them, I just don't see the "weird Internet" or "weird startup"
content anymore. But then Quibi ships and you see nothing but Quibi for a few
days. It's just not how I remembered TC.

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woeirua
Companies with marginal business models are going to get slaughtered in the
next year. Carvana, Opendoor are probably the most well known of these
companies.

Opendoor's business model was super questionable from the get-go: who's going
to sell you their home for less than market value? How can you then do
something to turn that around and profit without basically turning the company
into a giant high-risk flipping enterprise?

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sremani
[https://stratechery.com/2016/opendoor-a-startup-worth-
emulat...](https://stratechery.com/2016/opendoor-a-startup-worth-emulating/)

This is an amazing read, and I still think it is a worthy model, during stable
times.

~~~
dlp211
> As interest rates rise or housing prices fall

Well that aged like milk.

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HugoDias
Damn, this list keeps growing and growing ...
[https://layoffs.fyi/tracker/](https://layoffs.fyi/tracker/)

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daxorid
Yes, but stocks are ripping higher on much worse jobless claims, housing
starts, and Philly Fed numbers than expected, 113 unexplained cases of
reinfection in South Korea, and the PPP fund being completely tapped out with
three weeks to go in Congress' recess.

The market is fully convinced that everything is fixed.

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mardifoufs
That's not what the "market thinks" at all. The stock market is much more
complicated than you assume it is. But if you want a really simple
explication: 4t$ more in circulation chasing the same amount assets, interest
rates make it non viable to hold bonds, and you don't want to buy bonds
anyways if you expect a more inflationary economy. If there's expectations of
inflation, you go for stocks and if there's inflation AND 0 interest rate, you
RUN for stocks.

You can also think of it this way, retail investors can afford staying in cash
indefinitely but make up a tiny portion of the capital. Big money NEEDS to
either buy bonds or park their capital in any yielding asset. Right now
treasuries offer safety but negative real yields for probably a long time. But
a pension fund still needs to generate returns to pay it's beneficiaries. So
what's the best and cheapest option right now, by far? Stocks. You have to
keep in mind that prices are relative so if stocks are _relatively_ cheaper
than bonds you buy stocks. Now add 4t$ to that and you get a stock market that
stays strong _even_ if everyone in the market knows the huge economic risks we
are facing right now.

Never assume that a whole entire sector that has so much incentives to price
in all the available data would just ignore something because they feel like
it. I don't get how people really believe that.

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syspec
Tech crunch snarkiness at it's worst.

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tjomk
I'm surprised this got to the front page with a few upvotes. These days it's
either the news about the Corona virus or that one of the companies that
SoftBank has invested in is announcing a layoff. These days every other
company is announcing layoffs or salary cuts.

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natas
Another Softbank great idea.

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agustif
Everybody hates SoftBank nowadays, it's not even cool anymore, lol

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anticsapp
More like.. Closeddoor. (•_•) / ( •_•)>⌐■-■ / (⌐■_■)

