The embattled chief executive of online mortgage lender Better.com has issued a groveling apology after he laid off hundreds of workers during a now-viral three-minute Zoom call — admitting he “blundered the execution.”
“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,” Vishal Garg, the New York-based company’s CEO, said in a leaked email to employees.
“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,” he continued.
“We will talk more at our upcoming All Hands meeting about what to expect for the year ahead. I hope you’ll join me for the discussion.
“I believe in you, I believe in Better, and I believe that working together we can make homeownership better together.”
In a Zoom call last Wednesday, Garg callously laid off some 900 employees — then slammed hundreds of the ex-workers for allegedly “stealing from our customers” by not being productive.
In the wake of the mass termination, which was posted on TikTok and YouTube, at least three top executives have resigned from the company, Insider first reported.
The high-level departures were directly related to CEO Vishal Garg’s handling of recent layoffs at the company and his reportedly divisive management style, Insider reported.
“Anyone who is leaving right now, these are folks that have tried to make it work, and given their all to a company they believe in, but who ultimately get undermined by a CEO that doesn’t take advice from anyone and believes he’s always right,” a source familiar with Garg told Insider.
Separately, the company is also pushing back its plans to go public through a merger with a special purpose acquisition company by the end of the year, Bloomberg reported.
During the Zoom announcement of layoffs, Garg struck an unapologetic tone, according to leaked videos of the meeting.
“This isn’t news that you’re going to want to hear … 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, adding that he does “not want to do this.”
“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,” Garg said on the call.
The 43-year-old said that the “market has changed” and that the company had to slim down to remain nimble enough to adapt to the evolving housing market, which appears to be cooling after a pandemic-boosted boom — though Garg didn’t mention on the call the company’s $750 million cash infusion it got from investors last week.
Insider reported that Garg addressed the rest of the company’s employees shortly after the layoffs were announced, saying, “We should have done this three months ago.”
He added just half an hour after the firings that he was trying to create “Better 2.0,” with a “leaner, meaner, hungrier workforce.”
The company had hired the “wrong people” and had lost $100 million the previous quarter, he went on.
The CEO was later outed as the anonymous author of a scathing blog post that slammed Better.com employees on the professional network Blind.
“You guys know that at least 250 of the people terminated were working an average of 2 hours a day while clocking 8 hours+ a day in the payroll system?” the father of three wrote.
“They were stealing from you and stealing from our customers who pay the bills that pay our bills. Get educated,” he added.
Garg confirmed to Fortune that he was the author of the searing post.
Garg reportedly has built a reputation for having high expectations and punishing employees over tiny infractions.
Office managers were once reportedly criticized for failing to keep the mini-fridge stocked with Fiji and Perrier water, according to Forbes.
“Why do we have biscotti here like this??” he once demanded from office managers.
In another email obtained by Forbes last year, Garg wrote: ‘You are TOO DAMN SLOW. You are a bunch of DUMB DOLPHINS and…DUMB DOLPHINS get caught in nets and eaten by sharks. SO STOP IT. STOP IT. STOP IT RIGHT NOW. YOU ARE EMBARRASSING ME.”
At the same time, the Daily Beast reported earlier this year that one of his deputies, Elana Knoller, was given huge stock options that vested immediately, $8,000 per month for two homes and other perks.
Despite the favorable treatment, Knoller was eventually placed on administrative leave for bullying.
Better.com became a pandemic darling as city dwellers sought to flee to greener and larger spaces in the suburbs, fueling a boom in the housing market and associated lenders.
The company announced in May that it plans to go public through a SPAC, or special-purpose acquisition company, at a $7.7 billion valuation.