Startups that are catering to homebuyers are struggling as interest rates and inflation have climbed and inventory shortages continue in many markets.
The latest casualty in the space is Reali, which announced that it has begun a shutdown and will be laying off most of its workforce on September 9.
In a press release, co-founder and chairman Amit Haller said “the challenging real estate and financial market conditions and unfavorable capital-raising environment” led to the decision to wind down operations.
“Reali was one of the pioneering companies to offer the ‘buy before you sell’ and ‘cash offer’ programs to homeowners,” he said in the release. “We believed deeply in benefiting the consumer foremost in every transaction.”
Amit Haller and Ami Avrahami founded Reali in Israel in 2016 out of personal frustration as real estate investors with the quality of service provided by agents and the high commissions they paid out.
Their goal was to make “the real estate buying and selling process more transparent, honest, and professional.”
The startup touted that customers could buy and sell in one coordinated transaction, “eliminating resale contingencies, moving twice, and paying two mortgages at once.”
Since inception, the company has raised over $290 million in debt and equity funding, according to Crunchbase. Its last raise was a $100 million Series B in August of 2021 led by Zeev Ventures with participation from Akkadian Ventures, Signia Ventures, and others. At the time of that raise, the company was reported to have 180 employees, according to CTECH by Calcalist. The same publication reported this week that Reali had 140 employees.
In its press release, Reali said that “a small team of employees” would continue to support active real estate transactions through the end of the year.
The company added that it is in discussions with companies that have expressed interest in buying certain parts of its business, including mortgage origination, title & escrow, and power buying.
Haller and Avrahami also founded another startup, Veev, a real estate developer turned tech-enabled homebuilder that in March raised $400 million in a Series D round that propelled the company to “unicorn status.”
Reali is not alone in its challenges. Homeward recently laid off 20% of its workforce. And Better.com, which has had a host of other issues, has laid off thousands this year.
Source by techcrunch.com