The crisis is growing deeper at the startup Better.com, which is stuck in a public relations nightmare after CEO Vishal Garg brutally axed 900 workers in a last-minute webinar.
Multiple sources tell The Daily Beast that the company’s head of marketing, head of public relations, and vice president of communications all submitted their resignations in roughly the last week. The heads of communications and PR stepped down in the last two days.
“This is a first wave of resignations, and the company expects more,” a person familiar with the matter said.
ADVERTISEMENT
The executives were not asked to step down, a company source added. Insider previously reported on the resignations.
SoftBank-backed Better did not immediately respond to a request for comment. The outgoing head of public relations Tanya Gillogley, head of marketing Melanie Hahn, and VP of communications Patrick Lenihan all declined to comment.
The fallout stems from Garg’s decision to lay off 900 employees on Dec. 1 in a hasty video stream, just a day after the company announced that it had secured $750 million in capital from investors.
During the three-minute call, Garg declared that he had once cried when firing employees, but that he hoped “to be stronger” this time.
He did not cry and instead informed attendees that the company had decided to sharply trim its staff. “If you’re on this call, you are part of the unlucky group,” he said. “Your employment is terminated effective immediately.”
A video of the firing circulated widely on social media, generating millions of hits across platforms.
Almost immediately after the call, the affected employees’ computers began to automatically shut down, including the computers of those who hadn’t been able to attend the meeting—leaving them confused and panicked.
In a subsequent video call with Better’s remaining staffers, and in statements posted to the anonymous social media site Blind, Garg assailed the employees he had just fired, claiming that many had worked just two hours per day on average.
“They were stealing from you and stealing from our customers... Get educated,” he said, in comments previously published by Fortune.
Multiple sources say that, in truth, some of the laid-off workers had been top performers.
Garg also intimated that remaining employees should look over their shoulders, lest he chop them next. "If you felt in the past that people weren't looking,” he said, “everyone is looking now.”
On Tuesday, Garg sent a note to his staff trying to win them back.
“I realize that the way I communicated this news made a difficult situation worse,” he said in the letter, which The Daily Beast obtained. “I am deeply sorry and committed to learning from this.”
He also apologized for critiquing their former colleagues. “I failed to show the appropriate amount of respect and appreciation for the individuals who were affected and for their contributions to Better,” he said.
This is hardly Garg’s first scandal. As Forbes reported in November 2020, he has a long trail of disgruntled business partners and has faced allegations that he or companies he controlled may have misappropriated tens of millions of dollars. (Garg has denied those allegations.)
This summer, The Daily Beast wrote about internal tumult at Better, after Garg lavished enormous perks on one of his top lieutenants in questionable fashion. The executive was deeply unpopular among many members of the staff, multiple sources said, but was distinguished for her loyalty to Garg.
She left the company in June after she was placed on leave amid bullying allegations.
