UPDATED, January 27, 6:10 p.m.: Compass is laying off up to 40 employees across its IT, marketing and M&A teams, the company confirmed Monday.
Sources said the move, which is taking place this week, is part of a broader reorganization as the SoftBank-backed company consolidates roles that service agents. The sources said Compass will create a new team called the “Agent Experience Team” to replace teams of employees who onboarded new agents, train them on the Compass platform and staff the IT help desk. The cuts are taking place nationwide.
The layoffs represent a fraction of the New York-based firm’s 2,500 workforce. At latest count, the company has 18,000 agents and staff across the U.S.
Sources said jobs will also be cut from Compass’ M&A team, since the residential brokerage isn’t currently pursuing deals. In recent years, Compass has grown through strategic acquisitions with firms like Pacific Union International in San Francisco and Stribling & Associates in Manhattan.
This week’s cuts punctuate a period of massive growth for Compass, which in 2017 announced a plan to have 20 percent market share in 20 major U.S. cities by 2020. Late last year, Compass CEO Robert Reffkin conceded in a companywide letter that the company has not yet reached that target. While it has captured 20 percent of the market in cities like San Francisco and Washington, D.C., Reffkin said Compass hit 10 percent market share in “many more markets, which is major progress towards our 2020 by 2020 target.”
However, Compass’ grow-at-all-costs approach has become a thing of the past.
Last year, the brokerage said it would pump the breaks on its expansion to new markets, instead focusing on its existing markets. In the wake of WeWork’s failed IPO, Compass sought to distance itself from the co-working firm and found itself defending a $6.4 billion valuation.
In a statement, Rob Lehman, Compass’ chief business officer, said: “We are continuing to invest and grow at the same rate we always have, and we expect to increase our headcount every month this year.”
Write to E.B. Solomont at [email protected]