Vishal Garg, the founder and chief executive officer of digital mortgage company Better Homes & Finance, was removed from his position by the company’s board on August 3. The board named Daniel Lewis, a hedge fund manager who had joined the board one week prior, as the interim CEO to replace Garg.
The leadership change follows a period of significant valuation shifts and operational changes at the company. Better Homes & Finance held an $8 billion valuation during the COVID-19 pandemic, but its current valuation has fallen to $300 million. In 2021, Garg received widespread attention for laying off 900 employees during a single Zoom call.
Garg stated to CNN that he felt misled by Lewis, claiming the new interim CEO used praise for the company's strategy to secure a board seat before advocating for Garg's removal. Garg noted that while sales fell from $1.5 billion in 2021 to $70 million in 2023, the company is currently on pace for $200 million in sales this year. He attributed this growth to the implementation of artificial intelligence models that process mortgages faster than manual labor.
Public market investors have reacted immediately to the change, with the company’s stock price falling 45 percent since Lewis was named interim CEO. For current and prospective homeowners using the platform, the leadership dispute occurs as the company increasingly relies on AI models to process loans, a shift that Garg claims has tripled loan volume recently. The outcome of this dispute will determine whether the company continues with its current automation-heavy strategy or pivots under new management.
Garg has retained legal counsel and sent a formal letter to the board on Monday demanding his reinstatement. He has proposed working for a $1 annual salary until the company achieves profitability, at which point he stated he would voluntarily step down. A deadline for the board’s response to the letter was not reported, and the board has not publicly commented on Garg's specific allegations of being "hoodwinked." Any legal proceedings or further board votes on the permanent CEO position will determine the finality of Garg's ouster.