From layoffs to losses- the saga of Better.com

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Published on 05/19/2022

From layoffs to losses- the saga of Better.com

Aurora Acquisition Corporation, a Special Purpose Acquisition Company that plans on merging with Better.com, filed an S-4 file. This filing has shed light on the USD 300 million loss experienced by Better.com in the last year. This has been a sharp turnaround since 2020 for the company. According to Aurora's filing, Better's financial capacities have "deteriorated" due to several factors. These factors include the fluctuating interest rates and the impact of the reorganization of the company's sales and operations team in the third half of 2021 and its prolonged investments in its product offerings. In addition, the firm also had to experience a "negative media coverage" due to the mass layoffs that began on the 1st of December, 2021. All these factors have hit Better.com hard, and chances of its recuperating appear to be slim.

In addition to the aspects that have impacted the company's growth, the CEO of Better.com, Vishal Garg, has been in the headlines for all the wrong reasons. Prior to having been surrounded by controversy for callously firing 900 employees over a call, Garg has also been the centre of multiple lawsuits by Goldman Sachs, PIMCO, and other firm investors. As per the filing made by Aurora, these ongoing litigations appear to be a risk for the company's reputation, regardless of their outcomes. Accusations of misappropriation of intellectual property and trade secrets as well as failure to file corporate tax returns have been made against Garg. In addition to the lawsuits, companies like SoftBank have also pointed out a ton of legal and financial issues that all link back to Garg. Last week, the CEO of Better.com sent out an email to all the company's current employees, wherein he acknowledged his responsibility for the USD 750 million cash infusion provided by SoftBank.

Plight of Better’s employees

Furthermore, former employees of the company are coming forward and stating the issues they have been facing while collecting unemployment benefits after their layoff. These issues have been arising due to the failure of the online mortgage lender to file for appropriate taxes. This goes on to show the way Better has been treating its workforce. Additionally, reports have been made by TechCrunch that Better.com has also offered its workers in India an option to leave under a voluntary separation agreement. However, employees are finding it difficult to leave the company, as many of their resignations are being rejected by the firm. This is due to the unexpected overturn of the number of employees who wish to resign. As per reports, 90% of the 2,100 employees were said to resign, and hence the company had to put a cap on the number of employees that could leave. Only "closers and analysts'' were allowed to leave, which accounts for up to 920 employees who had their resignations accepted. According to sources, the company has also let go of many of its mid-level managers based in the US. These layoffs have been coupled with insane reorganizations within the firm, which has restricted the career opportunities for many of its present employees.

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Peter Daniels
Peter Daniels is the lead journalist for InsiderApps.com


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