Airbnb-backed Zeus Living slashes almost half of its remaining staff

Summary

A Business Insider article by Alex Nicoll, stamped 2020-05-12, reports that Airbnb-backed Zeus Living is laying off 73 employees, almost 50% of the company, according to a blog post by CEO Kulveer Taggar on Tuesday. The cut comes less than two months after about 80 people, one-third of the company at the time, were laid off in late March. Taggar cited the coronavirus and business travel, projected revenue at 55% of original expectations, fewer homes in the portfolio, and a decision to return the PPP loan the company applied for. The article says Bloomberg reported a raise of $15 million in equity and debt at a $110 million valuation, against $205 million in December. The exit package includes severance, one month of health insurance, paid vacation and keeping laptops.

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Finance

Airbnb-backed Zeus Living slashes almost half of its remaining staff less than two months after a round of layoffs

By Alex Nicoll

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Zeus Living's cofounders, CTO Joe Wong, COO Srini Panguluri, and CEO Kulveer Taggar. Zeus Living

2020-05-12T22:45:22.000Z

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Airbnb-backed Zeus Living is laying off 73 employees, or almost 50% of the company, CEO Kulveer Taggar said in a blog post on Tuesday . The news comes less than two months after Zeus laid off about 80 people , or one-third of the company at the time, in late March.

Taggar laid out the reasons for the cuts in the blog post, explaining that the coronavirus will continue to challenge business travel, leading to projected revenue that's 55% percent of the company's original expectations. The company will also have fewer homes in its portfolio and has decided to return the PPP loan it applied for.

Zeus Living rents furnished properties for stays of longer than 30 days in six metro-areas around the country, including New York, catering specifically to business travelers. The company has direct partnerships with other companies, like scooter startup Bird, which use Zeus as a replacement for extended-stay hotels for employees.

Last month, Business Insider reported that Zeus was telling landlords that it wouldn't pay April and May rent and was asking landlords to switch from leases to revenue-share agreement.

"I'm very sorry," Taggar wrote in the blog post. "This is a decision I hoped we wouldn't have to make and is not how I wanted us to part ways. Zeus has been built not by the founders but by the sheer will, determination, and grit of remarkable people I care about and call my friends. I'm honored to have had the privilege of working, building, and learning alongside you and will forever be grateful."

Last week, Bloomberg reported that Zeus had raised $15 million in equity and debt at a $110 million valuation, almost half of its $205 million valuation when it last raised money in December. Existing investors CEAS Investments I, Initialized Capital Management and Soros Fund Management all participated in the down round.

Airbnb, which invested in the company's last round, was absent. Last week, Airbnb laid off 25% of its staff, or 1900 people, as the coronavirus has put almost all business and corporate travel on hold.

Zeus has not yet responded to a request for comment on the fundraising.

In the post, Taggar outlined the exit package: which includes severance, one month of health insurance, paid out vacation days (legally required in California, where Zeus is based), and employees keeping their laptops.

"As an early-stage company fighting for longevity, we did everything we could to provide those being laid off with the most robust severance package possible," Taggar wrote. "We wish we could have done more to reflect your true value."

Zeus has not yet responded to a request for more details on the severance package.

Layoffs have hit the short-term rental world hard, with Lyric, also backed, by Airbnb, laying off 20% of its employees , and Sonder, laying off 33% of its staff, or 400 people.

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Alex Nicoll

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Alex is a reporter at Business Insider writing about private equity, alternative asset management, and the impact of these growing sectors on the wider world. Previously, he covered real estate and real estate technology for Business Insider. Some previous highlights include his coverage of the real reason Zillow Offers closed , remote work surveillance at a real estate data giant and a real estate's scion new cryptocurrency that's backed by gold he says is buried near Las Vegas . Before joining Business Insider in 2019, he worked for Bridgewater Associates and Peloton. He is also the secretary of the Insider Union. He welcomes any and all reachouts, prioritizes his source's safety, and has a long record of working with confidential sources to tell deeply reported, complicated stories. Get in touch! Contact this reporter via encrypted messaging app Signal at @alexnicoll.01 using a non-work phone, email at anicoll@businessinsider.com or alexonicoll@protonmail.com , or Twitter DM at @nicollsanddimes . (PR pitches by email only, please.)

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