According to an internal memo, the CEO of Better.com who dismissed 900 Zoom employees and charged them with theft last week is “taking time off effective immediately”.
Vice received an email confirming that VishalGarg had taken time off Friday and that an outside firm was hired by the mortgage lender to do a ‘leadership and culture assessment’.
The email read: ‘Vishal and the Board wanted to provide Better employees an update given the very regrettable events over the last week.
Effective immediately, ‘Vishal will have time off… A third party independent firm has been hired by the Board to conduct a cultural and leadership assessment. To build a sustainable, positive and long-term cultural environment at Better, the Board will consider these recommendations.
This decision follows Vishal’s 63-year-old resignation after he laid off nearly 900 Zoom employees on December 1. He told the workers that they were part of the “unlucky” group of people being fired.
Better.com’s controversial CEO Vishal Garg, 43, apologized after facing rampant criticism for laying off 900 employees over a Zoom call last week
Kevin Ryan was named interim Chief Finance Officer by the company. Ryan will oversee the company’s day-to-day operations and report directly to the Board.
“We still have a lot to do, and we want everyone to refocus on their customers so that we all can support one another to make our company great and something we are proud to be.
DailyMail.com requested comment from Better.com, which was not received immediately.
Garg faced criticism for the tone deaf way he fired hundreds of employees. A decision that he supports. After firing them, Garg took an aggressive tone and accused staff of time theft.
“You’ll be allowed to fail one time. However, you will not be allowed to fail again. In a digital town hall, he stated that failing to meet deadlines was unacceptable.
He then attacked his fired colleagues in blog posts for being so lax that they actually’stole customers’.
Garg issued an apology on Wednesday for his conduct as CEO. Garg addressed a note to his employees, which was later published on Garg’s company website. He wrote: “I regret the way that I handled the layoffs last Wednesday.”
“I did not show enough respect or appreciation to the people who were affected, and their contributions to Better.
“I made the decision to layoff, but I miscommunicated it. He said, “I embarrassed you.”
He accepted the resignation of three top managers in his company, amid reports that others were on the brink of quitting.
Vishal Garg wrote a note on Better.com, stating that he was sorry for how he handled layoffs. “I did not show enough respect or appreciation for those who were affected as well as their contributions towards Better.”
The letter concluded that he was deeply sorry for the manner he had communicated his news. This is a deeply regrettable situation.
“At Better your focus, dedication and expertise are vital in our vital work to unlock the value and joy of homeownership across the nation for customers.
‘I couldn’t be more grateful for all you are accomplishing for the customers we serve. Our All Hands meeting will be a great opportunity to discuss the future of our company and what we can expect in 2019. I hope you’ll join me for the discussion.’
“We’re also making quick steps to ensure that we’re very transparent about our goals and are aligned with our company’s metrics. We’re looking at how we can work together to better serve our customers.
The letter ended with the following: “I believe in You, I believe In Better, and that we can work together to make homeownership more affordable together.”
Garg disposed of all the diversity, equity, and inclusion staff members at the company. They deal with workplace racism complaints and have three top executives resign.
The head of public relations, Tanya Gillogley; head of marketing, Melanie Hahn; and vice president of communications, Patrick Lenihan have all handed in their resignations, according to Insider.
According to The Daily Beast, this is the first wave of resignations and The Company expects more.
Garg disposed of all members of diversity, equity, and inclusion, the team that deals with workplace racism and sexism complaints.
In his three-minute call where he fired the employees, he said that the ‘market has changed’ – meaning savage cuts to the $7 billion company’s workforce were needed to avert disaster.
Tanya Gillogley (left), the head of PR, and marketing chief Melanie Hahn (right) quit following the December 1 firings
After the December 1 Zoom Call, Patrick Lenihan was also removed as vice president for communications.
Despite receiving a cash infusion of $750 million last week, the firings took place.
According to the boss, market efficiency, productivity, and performance were also to blame. He added that the company had to move in order to survive.
Later, he apologized to the staff by email and acknowledged that he didn’t show enough respect for and appreciation for those affected and their contributions to Better.
He stated that he had made the decision, but that he didn’t communicate the details. You were embarrassed by my actions.
“I’m sorry that this was a bad way to communicate the news.
“I’m deeply sorry, and I’m committed to learning from this situation and being the leader you want me to become.”
After the meeting, participants on the call discovered that the computers in their companies had started to go down.
One angry worker filmed the call and shared it online, complete with a moment where they cursed at the CEO as he confirmed the mass ‘termination’ of employees from the Manhattan-headquartered mortgage provider.
The unidentified male worker could be heard to say: ‘F**k you dude. Are you f**king kidding me?’
Garg, previously accused of being erratic by workers, then doubled down on that accusation in a harsh blog post, where he criticized his staff for “stealing” through laziness.
On professional network Blind, the father-of-3 wrote: “You know that at most 250 people were working an average time of 2 hours per day while clocking over 8 hours per day in the payroll systems?
They were taking from you and our customers, who are the ones paying our bills. “Get educated,” he said.
Fortune interviewed Garg who threatened to strangle a former business partner to the wall and kill him, according court documents. He also confirmed that he made these comments using the anonymous username “uneducated”, but refused to relent.
He stated, “I feel they could have been phrased different, but frankly the sentiment was there,” he added.
It’s not news you want to hear… Garg announced abruptly on the phone that you were part of the unfortunate group being laid off. “Your employment here has been terminated immediately.”
He described earlier in his Zoom conversation how difficult it was to let go of staff members and how much he hoped that he wouldn’t cry like he did in the past.
He stated, “This is my second career and this is something I want to do.”
“The last thing I did was it and I still cry.”
“This time I want to be more powerful.
‘We are laying off about 15% of the company for a number of reasons — the market, efficiency and performances and productivity,’ he told workers.
The boss was later incorrected by a company spokesperson who stated that only nine percent of those laid off were actually true.
Garg told Fortune that four weeks ago the firm started reviewing employee productivity data, including missed telephone call rates, number of inbound and outbound calls, employees showing up late to meetings with a customer, and other metrics.
He said, “As we began to slow down the pace of hiring we saw some alarming stats and a lot of our customers weren’t getting the service they deserved from each other’s teammates.”
Garg’s reasoning behind firing workers was also questioned by reports that Garg, the CEO, accused them of being lazy and taking advantage of the company. Workers were reported to have worked two-hour shifts and had clocks 8+.
Staff were surprised by Garg’s actions and criticised him for holding another “threatening” companywide conference after announcements of the layoffs. He said that employees’ performance would continue to be closely monitored.
Fortune was told by a Fortune employee that the tone he used was very harsh and threatening.
Garg also warned that next year will be a bloodbath, according to two other witnesses.
Source: “It seemed very bizarre.” “The comments were troubling.
Fortune reported that Garg did not threaten employees and that there was no extra monitoring beyond what is required by regulators.
But he admitted that his firm looked more closely at productivity data.
He claimed that his “bloodbath” reference was out of context. It was more about the mortgage market.
Better, which offers pre-approval on a mortgage in minutes, saw its share price soar during the pandemic as the saturated home buying market, coupled with low interest rates, saw thousands of new customers looking for fast ways to get a loan.
The Information reports that the company has increased its workforce by 2,000 since Covid was founded and had a target of generating $800 millions in revenue for this year.
Even with the lay-offs, it has still 9,000 employees in the US and India.
Fortune quoted Garg as saying that investors and members of the firm were supportive of job cuts. Garg refused to identify the board members and investors who offered support.
A former aide and two current employees told the site Garg’s reputation for acting erratic in Better’s Slack messaging system, as well as during company meetings, was something that they both knew.
In one Slack message, he stated that “if you’re not interested in hard work,” he said.
It is reported that the CEO has high standards and demands of his employees, down to the most minute details.
Managers of offices were criticised for not keeping mini refrigerators stocked with Perrier or Fiji water.
Garg also insisted on bottles of Gerolsteiner, his sparkling beverage of choice, according to Forbes.
“Why is it that we make biscotti in this way?” He once asked office managers why they had biscotti like this.
Forbes received one email in which he wrote the following: You are too slow. You’re a group of DUMB DOLPHINS… STOP IT. STOP IT. STOP IT. YOU EMBARRASS ME.
Better’s headquarters is 44,000 square feet of office space on the 59th floor of 3 World Trade Center in Manhattan
In August, The Daily Beast reported that one of his closest executives, Elana Knoller received stocks worth potentially tens to millions of dollars and $8,000 per months for two homes, as well as other perks.
Knoller was finally placed on administrative leaves for bullying.
The Daily Beast also reported that Garg told a former business partner that he was ‘going to staple him against a f**king wall and burn him alive.’
Better featured in Forbes Fintech Top 50 and hopes to be public by the end of this year.
This week, it received $1.5 million in convertible and debt notes ahead of its scheduled debut.
After announcing that it would be going public via a Special Purpose Acquisition Company in May, Better received $750 million in cash last week. Now, the company is valued at $7.7 million.
Garg, who was born in India, moved to Queens as a seven-year-old and attended Manhattan’s acclaimed Stuyvesant High School.
His early entrepreneurial mindset was evident when he bought CliffsNotes books and CliffsNotes, which he then sold to other students at a profit.
Garg revealed that his superpower is math.
Teenagers also tried thrift shopping and later selling their clothes on eBay.
But a Better spokesperson confirmed that it was false because eBay didn’t exist until Garg had graduated.
He went on to study at New York University where he would meet his future business partner Raza Khan.
In 2000, they founded MyRichUncle online student loan company.
In 2007, it was publicly traded and had more than 300 million loans under its belt. It started out with only $30,000 in capital.
In 2007, the financial crisis led to the liquidation of the company.
Khan and Garg were inspired by the subprime mortgage crash to explore a new market for lending.
They used the MyRichUncle algorithms to create EIFC which can identify toxic mortgages.
This tool was created to assist investors in identifying mortgages that were not properly issued. Investors can sue banks for selling bad loans.
Khan stated to Forbes that despite promising early results, he observed inconsistencies with the financial statements.
He sued Garg in 2013, alleging that Garg’s tax returns were not properly filed, and that Garg moved $3,000,000 to his personal bank account.
Since then, the pair has been embroiled in an extensive legal dispute.
According to court documents, during one hearing in December 2019, Garg turned to Khan and said that he was ‘going to staple him against a f***ing wall and burn him alive.’
Garg later apologised during the deposition because he let his ’emotions out of control’
Forbes, 2020: A Better spokeswoman said that lawsuits were an unfortunate reality for both successful startups and their chief executives.
Khan was named by him as an ex-friend and former business associate who is a litigious.
Better’s story is a more optimistic one.
Forbes reported Garg’s story about how his wife and he rented their house while they were pregnant.
He said that he lost a property that he wanted to purchase to an all cash buyer because the mortgage process took so much time and was inefficient.
Garg started Better in 2014 to streamline the approval process. Better offers pre-approval for your phone within 3 minutes.
Additionally, it would not charge the borrower-paid fees making it less expensive for consumers.
Better would then sell the mortgages to other lenders, such as Fannie Mae and Freddie Mac.
It has been a big hit.