Better.com CEO Vishal Garg, who hogged the limelight for firing nearly 900 employees over a Zoom call in 2021, has acknowledged to employees that he “personally guaranteed” $750 million of the $1.5 billion cash infusion into the company by SoftBank.
It was Garg and not the company, who took responsibility for compensating the Japanese investment giant SoftBank for any losses, reports TechCrunch.
On November 30, 2021, Better.com, which is a digital mortgage lender, announced that “Aurora Acquisition Corp and SoftBank decided to amend the terms of their financing agreement to provide Better with half of the $1.5 billion they committed immediately instead of waiting until the deal closes”.
A filing by Aurora said the “Better Founder and CEO in his personal capacity has agreed to enter into a side letter with SoftBank, according to which he may be liable for realised losses or receive payments in certain circumstances from SoftBank in connection with the post-closing convertible notes”.
In response, Garg in an email to employees acknowledged personal responsibility for the $750 million cash infusion, the report said late on Friday.
“I am fully committed with everything I own and will ever own. Five years from now, when that SoftBank $750 million loan comes due around my 50th birthday, it means I have nothing. Well, at least we will have given it a real shot… this is true. I did personally guarantee three quarters of a billion dollars and I’m personally liable for it,” he told the employees.
The report, citing sources, also said Better.com in recent weeks offered “its workers in India the option to leave under a voluntary separation agreement”. In total, nearly 920 workers had their resignations accepted.
After laying off nearly 4,000 employees in the US and India, digital mortgage lender Better.com offered employees paid severance or voluntary separation and health insurance coverage.
According to the company, the uncertain mortgage market conditions created an exceedingly challenging operating environment for many companies in the industry.
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