Company valuation has fallen by more than 75% since the UK-based brokerage launched in Los Angeles in 2017
Following months of uncertainty over Purplebricks’ future in the United States, the flat-free brokerage is exiting the market, less than two years after launching in Los Angeles in September 2017.
As first reported by Bloomberg, the U.K. company saw its stock climb by as much as 5 percent on Wednesday after plummeting by more than 75 percent since entering the country in 2017. Last year, the company reported a full-year operating loss of 34.1 million pounds, or approximately $42.9 million.
The announcement was met by snark among some industry professionals. Jason Frazier, of Shred Media, wrote that Purplebricks can “Brexit, stage left” on Facebook.
In the months leading up to Wednesday’s announcement, Purplebricks went through a major turnover in leadership roles, including the departure of U.S. CEO Eric Eckardt in May. The company offered an upfront flat fee of around $3,600 but has also experimented with more traditional models after seeing the flat-fee approach flounder in the U.S.
Also in May, the company announced it was shuttering its operations in Australia after two and a half years in the country. The firm also said at the time it was reviewing its operations in the U.S., hinting then that it might retreat here as well.
Overall, the future of the company has been uncertain. Last month, German media company Axel Springer purchased tens of millions of Purplebricks shares, leaving some to speculate that the company, which publishes a number of European newspapers and also owns U.S.-based website Business Insider,was devising a takeover.
BY VERONIKA BONDARENKO-Inman News
TODAY 7:23 A.M.