Turo, a San Francisco-based peer-to-peer rental startup, is often described as an “Airbnb for cars,” and after planning to shelve, it fired about 15% of its team, and about 150 employees.
The news first reported by Bloomberg comes as Toro tries to cut costs and continue to float in a tough funding environment. Like many startups, Turo was focusing on the open market to raise fresh capital. However, these plans are currently pending as investors’ appetites are still trying to prove that they are trying to prove that they can make a profit.
“Due to continued economic uncertainty and to strengthen our position for long-term growth, Turo has made the extremely difficult decision to cut the size of our team by about 15%,” a spokesman for Turi told Bloomberg.
Founded in 2009, Turo built a model around daily car owners renting cars to others. It raised over $500 million from companies such as Kleiner Perkins and IAC, and reached a $1.5 billion valuation in its final funding round of 2022. However, the momentum has slowed down. Between inflation, rising interest rates and a more cautious investment environment, Turo is being readjusted.
Those familiar with the issue say that leadership has decided to leave the IPO for now. It cites investors’ skepticism about the tougher market conditions and long-term profitability. Internally, layoffs were framed as part of a broader effort to restructure and sharpen the focus on sustainability.
X’s Social Post reflects Bloomberg’s report, focusing on comparisons of layoffs and drawings in mobility spaces such as Uber and Airbnb.
Turo’s platform relies on a committee model that connects car owners with tenants and reduces each booking. While this idea is fascinating, startups face serious competition with traditional rental players like Hertz and Enterprise. At the same time, you need to address tricky issues with insurance, host reliability and maintenance. All of this puts pressure on margins and growth.
The Wall Street Journal noted that Turo’s decision reflects a larger pullback across technology, especially among startups that they’ve been aiming to make public in the past year. The stock market remains unstable, so companies with no consistent revenue are told to prove they can survive more lean.
Turo has not issued any official official statements regarding layoffs or IPO freezes. A spokesman told TechCrunch that the company is focusing on “providing value to the host and guest community” and although there is no new timeline for revisiting the IPO, it focuses on its commitment to car sharing innovation.
For now, Turo is on the growth list of high-tech startups that hit the brakes and tighten their operations. According to layoffs tracking sites, at least 93 high-tech companies have eliminated 23,505 jobs so far this year, according to FYI.
The path forward includes improving that approach, finding ways to stay competitive, and ensuring investors have a far-off foot.
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