Compass is reeling from a horrible year, from financial losses to tech troubles to mass layoffs
Hi, I'm Matt Turner, the editor in chief of business at Insider. Welcome back to Insider Weekly, a roundup of some of our top stories.
First off, we reported on Friday that Goldman Sachs will cut up to 4,000 jobs. Insider's finance team has been covering the Wall Street giant's struggles in its consumer business all year and will be continuing its sharp coverage of Goldman and its rivals.
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On the agenda today:
- Inside the lavish, secretive, post-Google lives of Sergey Brin and Larry Page.
- Laid-off tech workers are landing new jobs fast — and even scoring raises.
- Everyone wants to be an activist investor these days. Here's why it's not that easy.
- Young adults living with their parents are saving on rent and fueling a luxury boom.
Up first: Senior real-estate correspondent Daniel Geiger is giving us a behind-the-scenes look at the recent turmoil at Compass.
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Inside Compass' horrible year
Compass went public with an $8 billion valuation in April 2021, powered by a suite of software tools it said makes its nearly 30,000 brokers more productive. Its revenue topped $6 billion that year, vaulting it well past rivals like Douglas Elliman and Redfin, senior correspondent Daniel Geiger writes.
This year, the company's outlook has darkened.
With home sales dipping amid rising interest rates, Compass has cut workers and bled cash. Its market cap fell to about $1 billion. It slashed revenue projections by about 25%. In June, it laid off about 450 corporate staff, and in October, it let go of about half its 1,500-person tech team.
CEO Robert Reffkin's once sunny public demeanor has become more somber.
In an internal memo to the company's leadership team in December, he said underperforming employees should be identified and terminated — and that management would be on hand to help fire subpar workers.
The missive sapped morale. "Everyone I work with has given everything and more to this company," one manager told Insider. "This message is a real stain on the organization."
The party animal and the island-hopping hermit
Since stepping down from Google's parent company, Alphabet, in 2019, Google cofounders Larry Page and Sergey Brin have taken two diverging paths: Page became a virtual recluse, spending much of the pandemic holed up on his private island in Fiji. Brin, on the other hand, never strayed far from the spotlight, attending flashy events like Burning Man.
At their core, the former partners share a single overriding similarity: Both rely on a tangled web of corporate entities and family offices that serve to minimize their tax obligations, protect them from liability, and shield their wealth from public view.
See how Page and Brin have used their newfound freedom.
Also read:
- Larry Page and Sergey Brin gave $438 million to charities through their foundations last year. Here's where the huge donations went.
- Burning Man, mushroom parties, and jamming with math teachers: Inside Sergey Brin's whirlwind social calendar
- See Larry Page's growing collection of tropical islands
The hidden upside of tech layoffs
Even as the tech sector has been hammered by mass layoffs this year — more than 140,000 workers have been affected since March, by one count — the vast majority who've been let go haven't remained on the sidelines for long.
According to an analysis of laid-off workers conducted by Revelio Labs, a workforce-data provider, 72% have found new jobs within three months. Even more surprising, a little over half of them have landed roles that actually pay more than what they were earning in the jobs they lost.
Insider's Aki Ito explains how that's possible.
Also read:
Activist investing is harder than it looks
Investors like Carl Icahn wrote the modern playbook on shareholder activism: quietly take large positions in public companies and then agitate for change.
As stock prices plummet following the pandemic, large companies — like Disney, BlackRock, and Alphabet — are now vulnerable targets to activist investors. But while activists appear to have the wind at their backs, experts like Icahn lay out why it's not as easy as it seems.
Find out what's standing in their way.
A luxury boom is underway
High rental costs, enrollment in higher-education programs, and delayed marriage are keeping more young adults at home. Nearly half of Americans between the ages of 18 and 29 are living with their parents, a high not seen since the Great Depression era.
All that money they're saving on rent is freeing up more disposable income for discretionary spending, and it's fueling a surge in luxury spending, analysts found.
Also read:
This week's quote:
"Naauuuur," "slay," and "ick"!
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More of this week's top reads:
- Since the holidays are upon us, here are 48 thoughtful last-minute gifts that don't feel rushed.
- The 34 tech companies most likely to be on the holiday-shopping lists of PE firms.
- I was a pro soccer player. I was tricked into going to Qatar to work construction.
- Parental leave is the greatest benefit workers don't take. Here's what's going on.
- Junior bankers reveal the best — and worst — parts of working at Wall Street firms.
- An Amazon exec was investigated by the company after allegations surfaced that she created a hostile work environment.
- Sam Bankman-Fried is in jail, but legal watchers are wondering: Where's ex-girlfriend Caroline Ellison?
- Some Salesforce managers were asked to rank their bottom 10% of employees.
Curated by Matt Turner. Edited by Jordan Parker Erb, Hallam Bullock, and Lisa Ryan. Sign up for more Insider newsletters here.