Better.com founder and CEO Vishal Garg has issued an apology to the online mortgage lender's remaining staff amid swift backlash for his controversial decision to lay off about 900 employees, or approximately 9% of its workforce, over a Zoom call.
"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," Garg's email, which was first leaked on Blind Network, states. "I realize that the way I communicated this news made a difficult situation worse. I am deeply sorry and am committed to learning from this situation and doing more to be the leader that you expect me to be."
Garg emphasized the company is taking "fast steps to make sure we are very transparent and aligned as a company on the goals for 2022, the metrics that matter most and how we can all work together even better to serve our customers and achieve our mission." He said he would discuss what to expect for the year ahead at an upcoming meeting.
"I believe in you, I believe in Better and I believe that working together we can make homeownership better together," the email concludes.
The apology comes after several top executives have reportedly resigned due to the controversy, including Better.com head of marketing Melanie Hahn, head of public relations Tanya Hayre Gillogley and vice president of communications Patrick Lenihan.
In the call, which was posted on YouTube, TikTok and Twitter, Garg told employees that the "market has changed" and that Better.com has to "move with it in order to survive". In addition to market conditions, Garg cited efficiency, performances and productivity as reasons for the layoffs.
"If you’re on this call, you are part of the unlucky group that is being laid off. Your employment here is terminated effective immediately," he said. "This is the second time in my career I’m doing this, and I do not want to do this. The last time I did it, I cried."
The 43-year-old, who has been critical of his staff in the past, according to Fortune, revealed to the outlet that he was the author behind an anonymous blog post on professional networking site Blind Network after the Zoom call which accused some of the impacted employees of stealing or working an average of 2 hours per day.
The controversy comes as Better.com previously announced plans in May to go public through a merger with special purpose acquisition company Aurora Acquisition Corp, which gives the company an implied equity value of approximately $6.9 billion and a post-money equity value of approximately $7.7 billion.
On Nov. 30, the companies announced they were delaying the listing to seek regulatory approval for a revised agreement and are working towards completion of the merger in a "timely manner."
Under the new terms, Better.com will receive a $1.5 billion private investment in public equity from SoftBank subsidiary SB Management Limited and Aurora's sponsor, Novator Capital, comprised of a $750 million bridge financing that will be received immediately and an additional $750 million convertible note. The new terms were announced prior to the Zoom call firing.
From its founding in 2016 through mid-2021, Better funded over $45 billion in home loans and provided over $25 billion in cumulative coverage through its insurance divisions, Better Cover and Better Settlement Services. The company has raised over $400 million in equity capital since inception.