US-based short-term rentals startup Frontdesk is on the brink of shutting down after firing its entire 200-person workforce on Tuesday after failing to raise capital to counteract the high costs of its business model—leasing rental apartments at market rate, furnishing them, and subleasing them out as short-term rentals.
During the call, CEO Jesse DePinto explained to full-time, part-time and contractor employees that the company would file for a state receivership—a faster and cheaper alternative to bankruptcy.
The Milwaukee-based startup's website remains live for now, but the likelihood is that the company will shut down very shortly.
Frontdesk has raised more than $26M in funding from the likes of Veritas Investments, JetBlue Ventures and Sand Hill Angels since its foundation in 2017, with circa 1,000 rentable units available across the United States.
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