Opendoor, OPEN, board chair Rabois says company is 'bloated,' needs to cut 85% of workforce

Opendoor’s new chairman, Keith Rabois, sharply criticized the company as “bloated” on Friday and pledged to slash as much as 85% of its workforce.

“There’s 1,400 employees at Opendoor. I don’t know what most of them do. We don’t need more than 200 of them,” Rabois said in an interview with CNBC.

A longtime Silicon Valley investor and part of the so-called “PayPal Mafia” alongside Elon Musk, Peter Thiel, and Reid Hoffman, Rabois rejoined the company this week as it installed former Shopify executive Kaz Nejatian as CEO. Nejatian replaced Carrie Wheeler, who stepped down in mid-August following pressure from Rabois and hedge fund manager Eric Jackson.

Wheeler, who had led the company for three years, said in a statement that accelerating her succession was “the best thing I can do for Opendoor now.” Her departure came after the stock surged more than sixfold since June, fueled by retail investors and activist campaigns.

Opendoor, which went public via SPAC in 2020 before losing nearly all its value, has rebounded sharply this year but still faces investor skepticism after earnings showed weaker home acquisitions and no clear turnaround plan. Shares spiked nearly 80% on news of Rabois’s return and Nejatian’s appointment but slipped over 12% the following day. Even so, the stock remains up nearly 500% in 2025.

Rabois said the company’s culture had been “broken” by remote work and pledged to return to in-person collaboration. “This company was founded on the principle of innovation and working together in person. We’re going to return to our roots,” he said. He also criticized what he called the company’s detour into DEI initiatives, adding, “We’re gonna fix all that.”

Opendoor, known as an “iBuyer,” makes instant cash offers to homeowners, buys properties directly, renovates them, and resells for profit, while collecting service fees similar to agent commissions. The company has expanded into mortgages, title, escrow, and warranties, and is experimenting with new products like “Cash Plus” and partnerships with local agents.

Its business relies heavily on proprietary algorithms and AI to price homes and manage risk. Compensation at Opendoor reflects its tech-driven model, with engineers earning from about $180,000 at entry level to over $700,000 in top roles. The median is around $240,000, while overall average pay is estimated near $287,000.