Stayzilla vs Opendoor (2022 crisis)

Stayzilla, India's leading homestay booking platform, was shut down in February 2017 by founder Yogendra Vasupal citing unit economics problems. Days later, Vasupal was arrested on fraud charges filed by a creditor company. The arrest triggered a national debate about founder liability in Indian startup failures. Vasupal spent weeks in jail before bail. The case became a landmark in India for both startup failure and founder criminal liability.

Opendoor pioneered iBuying — purchasing homes directly, making improvements, and reselling. The model requires buying low and selling higher in a rising market. When the Fed began aggressive rate rises in 2022, mortgage rates doubled from 3% to 6%+, home prices fell, and Opendoor was stuck with inventory purchased at peak prices. Q3 2022 saw a $928M net loss. The stock fell 90%+ from peak.