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Better.com layoffs


Nice Guy Eddie
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I'm guessing that everyone has seen the video from last week where the CEO of Better.com (mortgage company) had a video call where the participants were all laid off. About 900 people. The CEO is now on leave himself (not fired) because of how he handled it. I gather these were work-from-home employees. What does Surly think of this incident? My thoughts below.

  • Bad look to layoff people right before the holidays.
  • Better.com should have been fully prepared for the video to be released by angry people.
  • The CEO made the call about himself. ("I hate doing this."  "Last time I laid people off I cried.") No one care about you.
  • The CEO later blamed lazy employees (working 2 hours/day but clocking in for 8 hrs) as a main reason. Layoffs should be communicated that its mgmt's fault or uncontrollable conditions. If employees are not working, then fire them.

I'm not quite as critical about a Zoom layoff. It sucks and is heartless but so is any big layoff. But maybe it doesn't need to be a 900 person video layoff but rather by division or dept and led by someone that the employee actually has met.

EDIT: The worse part that shows the CEO as tone deaf, in terms of what the remaining employees would think of this. Layoffs can be just as much about the comm to the remaining as departing employees. If I worked there, I would be looking for a new job.

Edited by Nice Guy Eddie
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I'm guessing that everyone has seen the
from last week where the CEO of Better.com (mortgage company) had a video call where the participants were all laid off. About 900 people. The CEO is now on leave himself (not fired) because of how he handled it. I gather these were work-from-home employees. What does Surly think of this incident? My thoughts below.
  • Bad look to layoff people right before the holidays.
  • Better.com should have been fully prepared for the video to be released by angry people.
  • The CEO made the call about himself. ("I hate doing this."  "Last time I laid people off I cried.") No one care about you.
  • The CEO later blamed lazy employees (working 2 hours/day but clocking in for 8 hrs) as a main reason. Layoffs should be communicated that its mgmt's fault or uncontrollable conditions. If employees are not working, then fire them.
I'm not quite as critical about a Zoom layoff. It sucks and is heartless but so is any big layoff. But maybe it doesn't need to be a 900 person video layoff but rather by division or dept and led by someone that the employee actually has met.
EDIT: The worse part that shows the CEO as tone deaf, in terms of what the remaining employees would think of this. Layoffs can be just as much about the comm to the remaining as departing employees. If I worked there, I would be looking for a new job.

I wasn’t laid off, but my former company had a large Google Hangouts layoff prior to Covid. It was tacky and heartless as hell. I started looking for a new job that day and luckily found a very good one quickly.
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there are bad ways to do it and there are good ways to do it.  like eddie said, this should have never been about himself except for taking responsibility for being in a position to need layoffs.  as a fintech company their aim is exp growth but they overshot for whatever reason.  that's management's fault.  don't blame the employees.  

 

the timing isn't the best, but i'll give them a pass because i don't know what their financial situation is.  did something happen after the end of october that necessitated layoffs?  did they not see it coming?  would their d2d operations be jeopardized if they waited til january to affect the layoffs?  only they know. 

 

 

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19 minutes ago, FirstTimeCaller said:

How big is that company? Haven't heard of them and they have 900 people they can lay off?

I dont know a lot about them, but they were started in 2016 and have grown to about 10,000 employees in that timeframe. heres an overview of their financials from a SPAC roadshow

image.thumb.png.31965415f6f53d90f7ce2811fa0d3650.png

About 85% of their mortgage business is refi's vs new home purchases. So while their growth has been impressive, I would imagine a world of rising interest rates could put a pretty significant dent in their future growth unless they can grow the smaller areas of their business. It was probably a mad dash to get to the public markets before the mortgage party ended. They seem pretty damn heavy on employees for a company with that revenue. 

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Part of this is narrative and part of this is just not understanding the optics of how Americans view big business and Q4 end-of-year terminations.

Americans are very untrusting of big business during the holiday season (and somewhat justifiably due to how things were approached regarding maximizing EOY books in the past) and so any form of mass layoffs during the holiday season will now be automatically listed as corporate greed and big business driven balance sheet manipulation.

The timing is a major problem here. That being said, this could have been easily done with a better approach to driving the narrative of why this was done.

A large majority of those terminated were documented to be falsifying activity reports and employment tracking data. The company only fired those people and the optics became ugly. If instead have the company state that they have terminated "X" number of employees for time manipulation and for theft and have turned the matter for "Y" over to law enforcement the greed narrative goes away and it is a narrative of people behaving badly and corrective action was taken once it was identified. Instead, they decided to be "nice" and just lay them all off and not fight the legal side of things, not realizing the impact to their brand would take over this.

 

Maybe I am a cold hard man, but they failed in the narrative first and foremost. Then they did a poor job on the rollout of the layoffs themselves. But if they controlled the narrative, the poor zoom layoff meeting would just be a blip in the PR radar instead of the shit show it has become.

 

 

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21 minutes ago, Blotto said:

I dont know a lot about them, but they were started in 2016 and have grown to about 10,000 employees in that timeframe. heres an overview of their financials from a SPAC roadshow

image.thumb.png.31965415f6f53d90f7ce2811fa0d3650.png

About 85% of their mortgage business is refi's vs new home purchases. So while their growth has been impressive, I would imagine a world of rising interest rates could put a pretty significant dent in their future growth unless they can grow the smaller areas of their business. It was probably a mad dash to get to the public markets before the mortgage party ended. They seem pretty damn heavy on employees for a company with that revenue. 

Would love to be a fly on the wall to watch where those estimates came from. They seem... ambitious.

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2 minutes ago, FirstTimeCaller said:

Would love to be a fly on the wall to watch where those estimates came from. They seem... ambitious.

Agreed, but they are in the process of convincing people that the SPAC merger was a good investment so I wouldnt expect them to be conservative. As it stands now, they have postponed the merger.

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In my professional life, I've exclusively worked at smaller groups, mostly startups, one of which went public but never really took off, and one research lab.  I've been laid off twice.  I've laid off a few engineers as well.  It sucks, both ways.

I think layoffs should be done face-to-face, by one's immediate supervisor and perhaps their immediate supervisor as well.  Obviously, that's hard to do when the headcount reduction is 900 employees.  That said, for those who are being fired for working 2 hours on an 8 hour shift, fuck 'em, do it by cattle call.  "Hey, every one of you is being fired for cause.  HR will email the signature documents."  But actual, financially-driven layoffs?  Handle them in a more personal manner.

That CEO defines "out of touch".

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I’ve lost refi’s to them, never on a purchase.  
 

They are essentially a trawler for cheap refinances and once those waters were over fished they couldn’t adapt (or maybe they are and the layoffs are the adaptation).  Good riddance-years from now I’m sure their bones will be picked over by the depository banks like in 2008. 

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I’m not sure why anyone, much less a CEO, feels the need to explain themselves. If you need to let people go, do it and be a man about it. Don’t say “I cried last time”. Let them go and have them call HR. HR can briefly get into the “Why?”.  They can say, “You falsified your time card / reports, and / or we aren’t growing; that’s why”. 

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2 hours ago, jimmyjazz said:

I think layoffs should be done face-to-face, by one's immediate supervisor and perhaps their immediate supervisor as well. 

typically, HR and Legal should do it and not your Manager, you can talk to them later, but the actual call or meetings should be those other departments and a different manager from your department. 

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46 minutes ago, next2naus said:

typically, HR and Legal should do it and not your Manager, you can talk to them later, but the actual call or meetings should be those other departments and a different manager from your department. 

Never in my life has legal been involved, and my manager has always been involved, even in those cases where I'm the direct manager.  HR is hit or miss in the meetings, depending on how pussified they are.

I do give credit to the HR department head who helped lay off some 1/4 of our company all the while knowing he was gone, too.  I probably would have told the C-suite to pound sand, but I suppose there were incentives involved.

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Seeing those financial projections reminds me of the time I realized most financial projection are full of shit. 

There’s no good way to handle layoffs. The old face to face handshake days are over, at least at big corporate, because people are insane. I’ve had to escort people out. I’ve seen threats, tantrums, challenges to a fight. 

Edit: most people could be clipped for “forging their time card” if you really wanted. Imagine all the times employees don’t accurate time. Even if off by 30 minutes. I’m not saying they were no good nothing shitheels, but I would take any company’s press release with a grain of salt. 

Edited by Neonmoon
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The only reason a CEO would personally do a mass layoff like this is if they are a cold, heartless bastard that likes that kind of thing.  There is no reason at all he needed to be the face of the layoff.  My company's chickenshit CEO loves him some layoffs but he'll never step up and throw down the axe himself.

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5 hours ago, LCHorn said:

I’ve lost refi’s to them, never on a purchase.  
 

They are essentially a trawler for cheap refinances and once those waters were over fished they couldn’t adapt (or maybe they are and the layoffs are the adaptation).  Good riddance-years from now I’m sure their bones will be picked over by the depository banks like in 2008. 

Yep. 
Had a refinance lost to them. It was like a 310k loan and I was working it skinny anyways and they came in better than me. The guy was like I would rather use you can you match this?  I was like thanks but no thanks. My pricing is ALWAYS very good and I’m always willing to do a deal but this was just stupid. I was like they have a different source of money than me or something else going on or they can’t actually do this. 
the guy emailed me like 45 days later- he said he got the deal they promised, no bait and switch but he’d never use them for a sale and probably not even for a refinance. Said the pain wasn’t worth the savings, probably. He had a goofy property and a goofy deal. He referred his secretary to me a couple months later. 
I looked into them a little bit at the time and shrugged and figured they couldn’t sustain their pricing/model and never thought of them again. Then I saw this story and said- yep-  not a surprise that rates go up half a point and they are doing massive layoffs. Such is the nature of hanging out in that market segment imo. 

Edited by Wulaw Horn
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Our lease is up in a few months. Probably not going to buy, mostly because I think we want out of Houston, but Better has a really quick tentative pre-approval process with no credit pull, so a few weeks ago I went ahead and ballparked my income/assets and submitted. They offered me a stupid high loan amount, like over 5x my income. It also felt shady because even though I repeatedly attempted to lower my down payment (their initial assumption was all cash/retirement assets toward the DP - y tho) it kept utilizing that all in down payment.

Their rep called me a couple times to follow up, both at inconvenient times. Normally I wouldn't have picked up the phone the first time but the area code was one I was expecting a work call from. Blew him off and he called me back later at like 10pm on a Saturday. I didn't answer but that was just kind of irritating.

Not a great vibe there.

 

Edited by gmr548
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I tend to presume that when another lender is lower on price it’s not because they have access to cheaper money, it’s because they are running skinny on their margins.

 

They are finding out what the survivors from a decade ago learned-you have to offer value beyond a good rate.  All of the really successful origination teams I network with really make it a point to not treat a particular loan as the beginning and endpoint, it’s just the start of an ongoing relationship.  If I’m going to loan you $500K on the most expensive thing you ever purchase I want you to know I’m not disappearing when the loan has closed and you have a problem-a $20/hr customer service rep in Durham just doesn’t have the same sense of obligation.  

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3 hours ago, Neonmoon said:

Seeing those financial projections reminds me of the time I realized most financial projection are full of shit. 

There’s no good way to handle layoffs. The old face to face handshake days are over, at least at big corporate, because people are insane. I’ve had to escort people out. I’ve seen threats, tantrums, challenges to a fight. 

Edit: most people could be clipped for “forging their time card” if you really wanted. Imagine all the times employees don’t accurate time. Even if off by 30 minutes. I’m not saying they were no good nothing shitheels, but I would take any company’s press release with a grain of salt. 

Unfortunately true. Bosses aren't going to sit down with their employees, explain their reasoning, and shake hands. Closure isn't really a thing anymore. 

I'd advised every colleague that's received a mixed mid year or year end review to start looking for another job because the company is building their case. In some cases, it's already decided and the company is just putting them on a hamster wheel they'll never get off of. I also suggest that show up on time, don't leave early, have a positive attitude, and never say no and they might pull their job out of the fire. 

If Better.com had fired 900 employees via email this wouldn't even be a news story. 

1) News outlets/their viewers respond viscerally to videos. 

2) Everyone hates Zoom. 

Edited by billfromlaketravis
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I would think that a lawyer would tell a ceo to not imply that people were being laid off for falsifying time or flat out not working. He didn’t say that in the video but did in another forum later.  If that isn’t true for all of these former employees, wouldn’t that open up the company to a lawsuit? Not to get them their job back but for publicly lying about their work ethic. Put that video up in front of a jury and see how they punish the company.

Now if a large number of people were really not working much, why not just fire them?  And you also have to assume that the company has downloaded tracking software on all computers now. I’m sure the current employees love being aware of that fact now.

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14 hours ago, jimmyjazz said:

Never in my life has legal been involved, and my manager has always been involved, even in those cases where I'm the direct manager.  HR is hit or miss in the meetings, depending on how pussified they are.

I do give credit to the HR department head who helped lay off some 1/4 of our company all the while knowing he was gone, too.  I probably would have told the C-suite to pound sand, but I suppose there were incentives involved.

Both WFR/RIFs I've been a part of had Legal and HR, one a the Fortune #56 the other a smaller shop. I'm old, I've been doing what I do for over 25 YRS. Much of their participation depends on why the RIF/WFR is happening and are there items to consider like Benefits, Stock Options, Non Competes, Confidentiality, Inventions, etc. 

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In terms of layoffs being on that call for more than like 3-5 mins was a mistake.

You need to say something akin to: "There is no easy way to say this, but effective immediately you are being released from the company. You will be receiving a packet containing severance information. If you have questions HR will be available to address them as they arise. I wish you all the best in your future endeavors and thank you for your contributions" then disconnect the call.

There is literally nothing you can say as a leader to make anyone being laid off feel better. Just get in, get out and STFU

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1 hour ago, BrazilHorn said:

In terms of layoffs being on that call for more than like 3-5 mins was a mistake.

You need to say something akin to: "There is no easy way to say this, but effective immediately you are being released from the company. You will be receiving a packet containing severance information. If you have questions HR will be available to address them as they arise. I wish you all the best in your future endeavors and thank you for your contributions" then disconnect the call.

There is literally nothing you can say as a leader to make anyone being laid off feel better. Just get in, get out and STFU

100%. You're not going to be their friend by cutting them loose so trying to be friendly is a losing proposition. Now as a CEO on a Zoom call laying people off, you're probably going to take some hits on the internet or media. But that goes with the territory including receiving fair criticism as his failure as a CEO with a company of poor hiring and mgmt practices. 

To add to your statement, I think a CEO should take ownership that a layoff is on the company and leadership and not on the individuals experiencing the layoff.  Sometimes leaders get this pat on the back for making the tough call to lay people off but appear to get a pass on their 100 previous decisions that led to the layoff.

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14 minutes ago, gurt said:

Guy seems like a real mess and trouble seems to follow him around. 

Last fall, employees at one of America’s fastest-growing startups began making anxious phone calls. They believed that CEO Vishal Garg—a volatile entrepreneur with a history of disgruntled business partners—had been giving huge amounts of equity to one of his most loyal lieutenants, in a way that violated norms and seemed to defy explanation.

Those employees may have been right.

New public filings, interviews with high-ranking company officials, and internal documents reviewed by The Daily Beast reveal that the executive, Elana Knoller, was given stock options potentially worth tens of millions of dollars. Unlike normal employee packages, it vested immediately. It isn’t clear how much the board knew in advance.

She also received at least $8,000 per month for two homes, including one in Puerto Rico, and other perks. It does not appear that any other executive got a comparable deal at the firm.

This year the pay kept coming. Around early February, Garg announced to his board that he had granted Knoller another 1.25 million options, easily worth eight figures, insiders say. For technical reasons, he couldn’t authorize more without the board’s approval, so he sought permission to issue her an additional 1.15 million options. It’s unclear if that approval was ultimately granted.

Just four months later, in June, Knoller left the company after she was placed on administrative leave for alleged bullying and other workplace grievances.

 

Zero percent chance he wasn't boning this chick or at least really hoping to.

 

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I had to lay off 3 people last friday.

Each call lasted less than 2 minutes, I said you're fired, but we're giving you 6 weeks severance, and here's the hr lady to tell you more details. She talked for a minute and then asked if they had any questions, they all said nope and we hung up.

I did talk to two of them later and explained more about why we let them go. None were offended and all kinda knew it was coming.

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12 minutes ago, blacklab said:

I had to lay off 3 people last friday.

Each call lasted less than 2 minutes, I said you're fired, but we're giving you 6 weeks severance, and here's the hr lady to tell you more details. She talked for a minute and then asked if they had any questions, they all said nope and we hung up.

I did talk to two of them later and explained more about why we let them go. None were offended and all kinda knew it was coming.

Were these people laid off or fired?  There's a difference.

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seems like financial shenanigans to get big as quick as possible, cash out as the exec team/ceo, and ultimately the company fails/acquired for pennies on the dollar.

they are back by Softbank. the number of companies backed by softbank with financial irregularities continues to defy the odds. 

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22 hours ago, pronghorn said:

seems like financial shenanigans to get big as quick as possible, cash out as the exec team/ceo, and ultimately the company fails/acquired for pennies on the dollar.

they are back by Softbank. the number of companies backed by softbank with financial irregularities continues to defy the odds. 

Softbank. lol. So true.

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54 minutes ago, blacklab said:

I dunno. They aren't working here anymore and we paid them 6 weeks severance. We told them their services were no longer required.

What's the difference?

If we fire someone, they are not eligible for rehire. Someone laid off would have a chance to come back. I’ve been told we actually laid off almost all the operators, warehouse, etc in the last 90s for a few months while the Sales group was getting things together.  Quite a few of those employees came back, and some have just started retiring recently. 

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I’d say firing and lay offs are essentially the same thing. It’s an involuntary dismissal. Period. 
 

Laid off does sound better as my guy Brennan can attest to. I’ve always suggested to those looking for work that they not mention they don’t have a job. The LinkedIn police won’t kick in your door for being slow to update your profile. 
 

At my company, you can come back if you leave voluntarily. It’s why I’ve strongly suggested to peers with mixed reviews to get out while they still can. We welcomed back two former employees as contractors when the job market was very bleak in 2020. They were happy for the work and we were happy to have the extra help. 

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Obviously same result of "you no longer work here" but my understanding has always been basically:

Layoff = We've had to cut your dept's budget/your position has become redundant/we're cutting expenses 25% company-wide...etc. We're sorry to have this happen, here's a severance, we wish you well in your future endeavors and will provide you with references in your job search.

Fired = You have violated company policy/failed to perform to expectations and we no longer wish to employ you. Pack your shit and get out.

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  • 2 weeks later...
On 12/14/2021 at 9:02 AM, Nice Guy Eddie said:

EDIT: The worse part that shows the CEO as tone deaf, in terms of what the remaining employees would think of this. 

A friend works for a company in the same industry, and from what he's heard from others, he wouldn't work for the guy.

I always assume that company equipment has tracking software, but If I were working for better.com, after the 900-person layoff, I'd be looking for a new job like crazy, because

  1. If the CEO couldn't handle a layoff, emotionally or otherwise, and wasn't smart enough to realize that and hand it off to HR or VPs or department managers, what the fuck else is he incapable of handling?
  2. If these people were truly fucking around and scamming the company, why weren't they fired well before now?  Were hundreds of people suddenly discovered to be scamming the system (300?  600? 900?)?  If hundreds and hundreds of people were flying under the radar and weren't discovered until some new tracking software was installed, that points to large-scale incompetence on the part of management.
  3. If they knew people were scamming the company and were just waiting for some arbitrary date, that also screams incompetence in management.  You find out somebody is messing around, you start firing people, and the rest will either fall in line or look for new work.
  4. If you were lumping honest employees in with the those scamming the system in the layoff pool, that's a huge fuckup on so many levels, and reeks of "we have to cut 10% of the workforce, find some reasons!" but you've also tarnished the reputations of those honest employees, which is going to bother remaining employees.
  5. The executive he was giving special treatment makes you wonder what else was going on that seems shady as hell.

 

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15 hours ago, atomheartbevo said:

A friend works for a company in the same industry, and from what he's heard from others, he wouldn't work for the guy.

I always assume that company equipment has tracking software, but If I were working for better.com, after the 900-person layoff, I'd be looking for a new job like crazy, because

  1. If the CEO couldn't handle a layoff, emotionally or otherwise, and wasn't smart enough to realize that and hand it off to HR or VPs or department managers, what the fuck else is he incapable of handling?
  2. If these people were truly fucking around and scamming the company, why weren't they fired well before now?  Were hundreds of people suddenly discovered to be scamming the system (300?  600? 900?)?  If hundreds and hundreds of people were flying under the radar and weren't discovered until some new tracking software was installed, that points to large-scale incompetence on the part of management.
  3. If they knew people were scamming the company and were just waiting for some arbitrary date, that also screams incompetence in management.  You find out somebody is messing around, you start firing people, and the rest will either fall in line or look for new work.
  4. If you were lumping honest employees in with the those scamming the system in the layoff pool, that's a huge fuckup on so many levels, and reeks of "we have to cut 10% of the workforce, find some reasons!" but you've also tarnished the reputations of those honest employees, which is going to bother remaining employees.
  5. The executive he was giving special treatment makes you wonder what else was going on that seems shady as hell.

 

all great points. Could you imagine a CEO complaining to their board about what a bunch of crappy employees that he hired. I imagine the entire board would look at the CEO as the first problem to solve.

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