Opendoor is shutting down its India operations less than two years after expanding in the country, placing the online home-buying company at the center of a debate over how AI may change offshore work.
CEO Kaz Nejatian cited a push to bring operational work back to the U.S., where Opendoor’s customers are, and a shift toward smaller AI-native teams. The company did not respond to TechCrunch’s questions about how many employees were affected or how much of the decision was driven by AI efficiency.
India Team To Be Closed
Reuters reported that Opendoor will lay off about 250 employees in India. The company had nearly 250 employees in the country when it opened offices in Chennai and Bengaluru in 2024.
Opendoor had built the India team to handle manual workflows across fragmented systems, according to Nejatian. The company has also been cutting its workforce more broadly after a difficult period for the U.S. housing market.
Securities filings show that Opendoor employed 1,042 people globally at the end of last year, down from 1,470 a year earlier. Its non-U.S. workforce also declined to 184 employees at the end of last year, compared with 342 employees at the end of 2024, according to the source article.
AI And Offshore Work Debate
The closure has gained attention across Silicon Valley because it touches a larger question around AI and back-office operations. India is the world’s largest Global Capability Center market, with more than 2,100 centers employing about 2.36 million people and generating nearly $100 billion in annual revenue.
Some investors viewed the closure as a possible sign of pressure on India’s outsourcing workforce. “As manual work gets replaced by AI, a lot of jobs will be lost in India,” wrote Sheel Mohnot, co-founder of Better Tomorrow Ventures.
Keshav Lohia, a venture capitalist at Emergent Ventures, described the decision as a “watershed moment” for AI-driven operations. He said AI advances are starting to challenge the cost-arbitrage model that helped make India a major offshoring destination.
Cost Cuts Remain Part Of The Context
The India closure is not only an AI story. Opendoor has been reducing costs across the company after a hard period for online home-buying businesses in the U.S. housing market.
Phil Fersht, chief executive of HFS Research, told TechCrunch that the development should not be viewed simply as jobs moving from India to the U.S. He said the larger shift is that AI is reducing the amount of operational labor companies need, regardless of location.
“This is not an isolated restructuring,” Fersht said. “It is part of a much broader pattern we are starting to see as companies redesign operations around AI, automation, and much leaner workflows.”
Fersht said the companies that benefit will be those that combine AI, software, and human expertise to deliver outcomes without continually adding headcount. He described that model as “services-as-software.”
Varun Rekhi, a venture capitalist at Speedinvest, said reduced demand for labor-intensive services could place pressure on one of India’s most important export industries. For now, Opendoor’s India exit remains tied to both its internal cost-cutting and the wider discussion about AI’s effect on offshore work.
Featured image credits: Opendoor
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