Better.com CEO Vishal Garg has come under intense criticism after he laid off 900 of his employees in the US and in India on a Zoom call last week. The SoftBank-backed mortgage company laid off about 9 per cent of its workforce through the video call shocker, giving his staff their biggest shock ahead of the holiday season.
Industrialist Anand Mahindra today weighed in on the Indian-American entrepreneur’s handling of the layoffs and wondered if it is fair to give Garg a second chance.
“I’m curious whether you think a CEO can survive after a blunder like this? Is it fair, or not, to allow a second chance…?” Mahindra, 66, tweeted.
Mahindra retweeted several people replying to his question, with most of them slamming Garg for his actions.
Apologising for the manner in which he handled the layoffs, Garg on Tuesday said he had "blundered the execution" of communicating the layoffs.
"I realize that the way I communicated this news made a difficult situation worse," he said in a letter.
The CEO had cited the market, performance and productivity as reasons behind the decision to lay off employees in the United States and India.
Better.com said in May it would go public through a merger with blank-check firm Aurora Acquisition Corp, in a deal that valued it at $7.7 billion.
"If you're on this call, you are part of the unlucky group that is being laid off," Garg told the staff during the Zoom video call last Wednesday. "Your employment here is terminated effective immediately." This is the second round of lay-offs Garg has undertaken, he said.
A video of the Zoom call is being widely shared on the internet, with people slamming the founder-CEO for his actions.
Garg, who founded Better.com in 2016, said all US-based employees laid off will get four weeks of severance, one month of full benefits and two months of cover-up for which we will pay the premium. He said they will get an e-mail from the HR detailing the benefits.
“I come to you with not great news. The market has changed and we have to move with it in order to survive, so that hopefully, we can thrive and hopefully, deliver on our mission,” he said as he began the grim announcement.
Vishal Garg is also the founding partner of One Zero Capital, an investment holding company. At 21, the New York University graduate dropped out of the investment banking analyst program at Morgan Stanley and started private student lender MyRichUncle. It went public in 2005 and was subsequently acquired by Merrill Lynch, which was then acquired by Bank of America.
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