Startups are heeding the advice of their investors and cutting costs fast in the face of a major recession. For one, Zillow announced today that it’s laying off 25 percent of its staff despite a 42 percent increase in traffic over the previous year. Zillow CEO Rich Barton explains it well:
“We concluded that we had no choice but to securely batten down the hatches as we sail into a major economic storm. The unprecedented economic events that are playing out on a global stage began in our own industry and have made a prolonged recession likely, in our judgment. We are a young company that is not yet making a profit. Despite having sizeable cash reserves, we deemed the responsible course was to meaningfully reduce expenses, so that Zillow emerges from the other side of the recession in a very strong position, even if the recession lasts many years.”
This is just the beginning of layoffs in the industry, I’m afraid…
