In a recent move, US-based home mortgage and home ownership platform Better.com’s Indian origin CEO Vishal Garg fired over 900 employees over a Zoom call just before Christmas. These firings have come close on the heels of raising $750 million and months after announcing its plans to go public.
Why this massive firing?
As per Garg’s Zoom call, he cited the lack of performance, market efficiency, and productivity as the reasons for letting people go. Kevin Ryan, the CFO of the company stated that they had to take this move due to the radically evolving home ownership trend. Meanwhile, the CEO accused employees of being unproductive and working only two years a day.
The layoffs are said to be primarily in India and the US and it covered the diversity, equity and recruiting teams. For now, there is no official confirmation on the geographical breakup of the layoff and remains to be seen employees in which regions receive pink slips.
Today, Garg seems to have realised he has done wrong, hints a letter to current employees that was leaked by a verified Better employee on Blind. In the letter, Garg apologised for the way he handled the layoff news. He has written, “I failed to show the appropriate amount of respect and appreciation for the individuals who were affected and for their contributions to Better. I own the decision to do the layoffs, but in communicating it I blundered the execution. In doing so, I embarrassed you.”
What does Better.com do?
Founded in 2014, Better.com works on financing home buyers and improving mortgages, thereby letting people get loans and financing online instead of going to the banks. The company offers loans at adjustable and fixed rates for various types of homes sans any commission.
With time, the company expanded its footprint and has partneredpartered with various companies. One such partner is Avex Funding, which specialises in prime conforming, as well as, jumbo mortgages for more than 10 years.
Better.com’s IPO
In the current scenario, when businesses eye to embrace remote work and the cost of owning a house is skyrocketing, Better.com is all set to go public. The online mortgage startup that streamlines the tedious and expensive process of buying a home has disclosed that it has struck a deal to go public alongside a merger with Aurora Acquisition, a special purpose acquisition company (SPAC).
The deal is likely to be finalised by the end of this year. In May this year, Better.com disclosed that it has struck a deal to be acquired by Aurora Acquisition. Those who are interested in investing in the company’s shares might have to wait as there is uncertainty in the housing market and a lot of risks associated with buying shares of any company. Later, in 2016, it was launched as Better Mortgage.
$750M investment
Following the announcement to go public, Better.com received a cash infusion from its investors earlier this month. SoftBank and Aurora Acquisition have amended the terms of the financing agreement to pump half of the committed amount of $1.5 billion to the digital mortgage company.
With this money, Better.com will double its existing businesses, launch new products and services, and build its custom-first home buying experience. Recently, the company added a slew of new insurance products and is in plans to foray into other categories such as student loans, personal loans and life insurance as well.
HR industry veteran Amy Spurling, CEO and founder of award-winning HR software company Compt, says Better.com is sending a very clear message to both its team and the candidate market about where their priorities lie. And–hint, hint–it isn’t a good look.
She says, “You can’t claim to be dedicated to building an inclusive and diverse workplace and then unceremoniously cut the entire DE&I team on a group call.”
While getting laid off over Zoom can be a knife in the chest to employees – and awkward, right? – Amy says what’s actually going on here is worse than the many headlines and articles include.
“The zoom call layoff wasn’t the worst part to me. When you’re fully distributed, you don’t have another choice really. I give him credit for being the one to have the conversation actually. What is inexcusable is the purported reason as to why he did the layoffs — that 900 people were lazy and only working 2 hours per day.
She concludes, “I don’t care how big your organisation is – if working only 2 hours per day is that pervasive, you have a serious management issue.”
