SoftBank-backed startup Better.com burns 900 in brutal cleanup
Better.com, SoftBank-backed mortgage startup with an extremely temperamental founder, has laid off about 10% of its current workforce, or about 900 people in the United States and India, according to two people familiar with the situation. And the company did so brutally.
In the US, all affected workers were abruptly summoned to a mass webinar on Wednesday where billionaire founder and CEO Vishal Garg gave a brief speech announcing that they contract will be terminated.
One person on the call told The Daily Beast: “It was a peak three minutes. Garg “has a very sad face. How real it is, I don’t know”.
Abrasive CEO — who used to email employees like them for “a series of DUMB DUMB DOLPHINS”—it was stated that he “might cry” during the news coverage. (He didn’t, the person said.)
After Garg’s speech, the meeting quickly ended and the employees’ computers automatically shut down, multiple sources said. Employees who were unable to attend the conference at the last minute had to scramble to figure out why their equipment stopped working. Other employees are on vacation and don’t know they’ve lost their jobs.
“They threw us like trash. We were there from the very beginning and worked hard for the company and our role,” said another employee who is now a former employee.
A spokesperson for Better said that the company spent the day trying to reach individual workers if they weren’t on the webinar.
Meanwhile, the CFO, Kevin Smith, sees the layoffs as a financial victory: “Balance sheets and workforce reduction and focus together set us up to attack on a growing home ownership market,” he said in a statement.
Layoffs happen company-wide. Among the casualties was an entire recruiting group that was diverse, equitable, and inclusive.
Preferably a few thousand jobs have been added this year, but the company has struggled to prove it can sustainably profit amid a tougher industry landscape. In their most recent financial release, they acknowledged that they likely won’t be able to maintain their previous growth rates during the pandemic, when low interest rates sparked a flurry of mortgage refinancing.
The company has been working on going public through SPAC, and just yesterday it announced a quick $750 million cash payout from those involved in that deal. It now has more than $1 billion in cash on its balance sheet.
That capital is clearly not enough to keep laid-off workers employed during the holidays. A company source said that furloughed US employees will be furloughed until the end of December and health care coverage through the end of February.
“I am 25 weeks pregnant and due in March. I don’t know what I’ll do when my coverage ends,” said one of the terminated employees. “Do I look for a new job as my due date is near? Let’s be real, employers won’t want to hire someone who’s 25 weeks pregnant and [has] going on vacation in three months.
Garg has faced scrutiny before. In August The Daily Beast reports Governance concerns at Better, after he donated a large amount of equity on unusually good terms to one of his highest levels, who was eventually forced out of the company. in the context of alleged bullying.
Two board members resigned last winter, apparently due to an internal dispute.
However, Garg showed full confidence, and it was clear that he wasn’t worried about saving the company money in the past — by reducing headcount or his own compensation. His bonus check last year, paid entirely in cash, hit $25 million.
https://www.thedailybeast.com/softbank-backed-startup-bettercom-fires-900-in-brutal-cleansing?source=articles&via=rss SoftBank-backed startup Better.com burns 900 in brutal cleanup