Opendoor's New Chairman Wants to Fire 85% of Workers, Calls Company "Completely Bloated"

Keith Rabois delivered one of the wildest corporate real estate workforce assessments in recent history during a CNBC interview on Friday.

The newly appointed Opendoor chairman said the company needs to slash 1,200 of its 1,400 employees, blamed remote work for a "broken culture," and promised to return the company to "merit and excellence."

What Happened?

Rabois didn't hold back when discussing Opendoor's workforce during his "Squawk on the Street" appearance.

"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.

"The company is completely bloated."

He explained that massive cost cuts are essential for the company's survival, especially given real estate's cyclical nature. "You need a resilient cost structure that doesn't depend upon selling 6 million homes a year, because it can come down to 4 million," he told CNBC.

The co-founder, who returned to Opendoor's board this week alongside new CEO Kaz Nejatian, said AI and other technologies have made these cuts easier to implement. He compared the situation to Shopify, where Nejatian previously served as COO.

On Working from Office

Rabois didn't stop at workforce cuts. He blamed the company's problems on remote work and diversity initiatives.

"The culture was broken," he said. "These people were working remotely. That doesn't work. This company was founded on the principle of innovation and working together in person."

Notably, Microsoft just announced all employees must work from the office at least three days a week starting February 2026, a sign that major tech firms are moving away from full remote work.

He also criticized what he called Opendoor's "DEI path," referring to diversity, equity and inclusion efforts. "We're going to fix all that. We're back to merit and excellence," Rabois declared.

The PayPal Mafia Group of Silicon Valley

Rabois is part of Silicon Valley's famous "PayPal Mafia" that includes Elon Musk and Peter Thiel. His comments reflect a broader trend among tech leaders rolling back remote work policies and diversity programs. Just this week, Musk’s AI startup xAI laid off 500 employees.

The timing seems strategic given Opendoor's financial struggles. Despite the recent stock surge, the company remains a cash-burning business with declining home acquisitions and unclear turnaround prospects.

Opendoor software engineers currently earn between $180,000 and $728,000 according to industry data, with average total compensation around $287,000. If Rabois follows through on his 85% reduction plan, most of those high-paying jobs would disappear.

The company hasn't responded to requests for comment about the planned workforce cuts.

What Opendoor Actually Does

Opendoor is an "iBuyer" company that offers homeowners instant cash for their properties without the traditional listing process. They buy homes directly, make repairs, and resell them for profit while charging service fees similar to real estate commissions.

The company went public in 2020 through a SPAC deal but crashed 99% from its peak before surging back this year.

Opendoor stock jumped 78% on Thursday after the leadership changes were announced, though it fell 12% on Friday. The stock is still up nearly 500% in 2025.