Evaluating only Loft’s profile at its peak — without knowing the outcome — the model ranked Market collapse as the #1 likely cause. That’s exactly how it died.
Key Events Timeline
FOUNDING
Loft founded
LAYOFF
Market downturn forces cuts
SHUTDOWN
Mass Layoff Spiral: Loft ceases operations
Full Analysis
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Documented cause
Loft built a residential real estate iBuying and brokerage platform in Brazil, allowing homeowners to sell quickly at a guaranteed price. The company raised $770M and reached a $2.9B valuation in 2021. When Brazil's central bank (BACEN) raised the Selic rate from 2% to 13.75% between 2021 and 2022, residential real estate transaction volumes collapsed. Loft conducted two rounds of mass layoffs in 2022 — first 159 employees (12%), then 380 more — cutting total headcount by over 60%. The iBuying arm was wound down.
Lesson
“iBuying is rate-sensitive by design: it requires cheap debt financing to hold inventory. When central banks tighten, the business model inverts before the balance sheet does.”