Jetty, a Silicon Valley-backed rental-insurance startup, has laid off 40 percent of its workforce, The Real Deal has learned.
The New York-based company cut more than 30 jobs as it looks to shore up its balance sheet to weather the coronavirus crisis, a spokesman confirmed.
Launched in 2017, Jetty sells rental insurance to tenants and acts as a guarantor on leases in exchange for 5 percent to 10 percent of the annual rent. Founded by Michael Rudoy and Luke Cohler, who together also started the design agency Breadhouse, Jetty also handles security deposits for a 17.5 percent fee.
In a statement, Jetty said the layoffs were necessary “to ensure the long-term health of the business.” The cuts were across several departments, including public relations and creative.
“Like every company in the country, we have felt the economic impact of Covid-19,” the statement said. “The primary reason for today’s cuts, however, is to control costs so we have ample funding to continue to expand our partner base and drive product innovation.”
Jetty raised a total of $40.5 million from blue-chip investors including Peter Thiel’s Valar Ventures and Keith Rabois’ Khosla Ventures, which led Jetty’s $25 million Series B in 2019.
At the time, Jetty said it had access to more than 500,000 rental units across the country via management partners including Beam Living, LeFrak and Rose Associates.
Last week, more than 7,300 workers in New York were laid off during a two-day period by employers citing Covid-19. The hotel and restaurant industries have been among those hardest hit, but residential real estate is bracing for a rough time.
Gov. Andrew Cuomo has instituted a 90-day ban on evictions. But tenant advocates in several states, including New York, have called for a suspension of rent. Landlords here and around the country are expecting a drop-off in rent revenue this month.