The startup industry was stunned when Better.com CEO Vishal Garg lay off 900 people in early December, accounting for around 9% of the company’s workforce. Now, a video of Garg and CFO Kevin Ryan addressing the surviving workers shortly after the CEO made the layoffs has surfaced, corroborating several stories of his brusque demeanor and harsh statements regarding those who were laid off.
Garg is shown in a video acquired by TechCrunch discussing the layoffs and confessing to making a lot of errors. We decided not to broadcast the video in order to preserve the source’s identity, but we’ve compiled a list of the most important parts based on a transcript of the 12-minute discussion here: “Make no mistake, we did also eliminate duplicate jobs — who could be good performers but were in the wrong location at the wrong time, with the wrong assignment, and weren’t mission-critical,” Garg stated around two minutes into the discussion.
Garg also acknowledged that the company was continuing to hire, including some interns, in the midst of the layoffs after about four minutes, while also making a thinly veiled threat: “… It’s because we expect those people to be super productive and add value, and if they don’t, we will exit them, too.”
He continued, “Going forward, we’ll be leaner, meaner, and hungrier.” We will not waste time attempting to generate funds. We’re not going to waste time worrying about what investors think. We’ll spend the next year or two hammering our firm ahead in what will almost certainly be a carnage in the mortgage market.”
Garg admits to not being diligent in managing the company’s finances and hiring plan at the eight-minute mark of the video, which helps explain the company’s second big layoff of over 3,000 individuals just three months later. It also lends credence to reports that the corporation is presently “losing $50 million per month,” according to various sources. “Today, we admit that we overhired and recruited the incorrect personnel.” We failed in our endeavor. I didn’t succeed. Over the last 18 months, I have not been disciplined. Last year, we made $250 million, and you know what? We probably squandered $200 million. Last year, we might have generated more money by being leaner, meaner, and hungrier.”
He also stated that the firm had lost $100 million in the previous quarter, and that it was his “mistake” not to lay off employees sooner. “Three months ago, we should have done what we did today… That’s what I’m saying right now, and it’s what I’ve expressed before to the board. You will not be permitted to make the same mistake twice. It will be encouraged for you to fail once, but you will not be permitted to fail twice.”
