This week’s flurry of startup cutbacks continues with Zillow, the real estate site best-known for estimating the value of people’s homes. Today, the Seattle startup announced that it’s cutting 25 percent of its staff. That’s a cut of 40 employees, according to local tech reporter John Cook.
Chief executive Rich Barton writes that Zillow’s traffic was actually up 42 percent in September compared to the same period last year, and that the company’s cash reserves are healthy. (For a web startup, Zillow is very well-funded, with a total of $87 million in venture financing.) But the company isn’t profitable yet, and he says “we had no choice but to securely batten down the hatches as we sail into a major economic storm.”
Zillow backers include Benchmark Capital, whose general partner Bill Gurley sent out an email to portfolio companies last week urging them to bring their finances under control (Zillow competitor Trulia is backed by Sequoia Capital, which recently called its startups in for its own cautionary presentation.) Another Seattle real estate site called Redfin announced a 20 percent layoff earlier this week.
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