// STARTUP COMPARISON
Loft (2022 crisis) vs Opendoor (2022 crisis)
Loft (2022 crisis) failed in 2022 due to Unit Economics. Opendoor (2022 crisis) failed in 2022 due to Bad Timing. Different causes, different sectors, different eras — but the same simulation outcome.
| METRIC | 🔥 Loft (2022 crisis) | 🔥 Opendoor (2022 crisis) |
|---|---|---|
| Sector | Proptech | Proptech |
| Country | Brazil | USA |
| Founded | 2018 | 2014 |
| Died | 2022 | 2022 |
| Raised | $788M | $1.9B |
| Peak | $2.9B valuation | $18B valuation |
| Primary Cause | Unit Economics | Bad Timing |
// WHY EACH FAILED
iBuying requires a low-rate environment to function. When mortgage rates double, buyer demand halves and holding costs double. iBuying in a rising rate environment is a leveraged bet against the central bank. Model it accordingly.
iBuying is a leveraged real estate bet. When rates double, the bet loses on both sides: the homes you own are worth less AND the pool of buyers who can afford to buy them shrinks. The model cannot survive a rate doubling with a 90-day inventory holding.
// IN THE SIMULATION
Loft triggers IBUYING_RATE_SHOCK — the simulation models iBuying (holding owned inventory) as carrying the maximum exposure to interest rate rises. Higher rates reduce buyer demand and increase holding costs simultaneously, squeezing both ends of the P&L.
Opendoor triggers IBUYING_INVENTORY_RATE_TRAP — the simulation models iBuying as having zero resilience to rapid rate rises when inventory is held at peak-price acquisition costs. A 300bps rate rise in 12 months is an existential event for a company holding $10B in homes.
// EXPLORE FURTHER