After mass layoffs and losses, chairman hopes for 'better' days
Better.com on Wednesday finally achieved its goal of being listed publicly, and its shares are now poised to be traded on the NASDAQ exchange starting today (Thursday), officials said.
In an interview with Mortgage Professional America, CEO & founder of Better and CEO and director of Better Home & Finance Vishal Garg expressed relief that the company he founded would now be able to be publicly traded. The official listing comes more than three years after Better HoldCo Inc. – the parent company of digital mortgage lender Better.com – announced it would go public via a merger with Aurora Acquisition Corp., a special purpose acquisition company.
At the time of the May 2021 announcement, company officials explained the transaction will make Better a publicly listed company while putting company equity between $6.9 billion to $7.7 billion. The company is now poised to trade under the ticker symbols BETR and BETRW. The merger with Aurora unlocks some $565 million of fresh capital, including a $528 million convertible note from affiliates of SoftBank and additional common equity from funds affiliated with NaMa Capital (formerly Novator Capital), officials said.
“Combined with our capital, it will make us one of the best-capitalized players in the marketplace,” Garg told MPA in an interview via Zoom. “It will allow us to continue to double down on ‘one day mortgage’ which has become our flagship product, greater access to capital and something we’re really excited about being able to now have the capital to market and distribute to consumers out there.”
An extension of corporate culture
He posited the public listing as an extension of a company mission: “We continue to believe that our mission of using technology to make homeownership cheaper, faster, easier will be furthered by the fact that we’re a public company and have greater access to capital. We’ll be in a position to grow coming out of what we expect to be a better mortgage market tomorrow.”
Better.com was not immune to changed mortgage landscape
Garg knows something about terrible mortgage markets. Three weeks from the Christmas holidays in December 2021, he laid off about 900 workers via a Zoom video call – earning widespread backlash due to the impersonal manner in which employees were let go. In the first quarter of this year, the company posted a net loss of $89.9 million – a staggering sum, but still lower than the $327.7 million in the first quarter of 2022.
Despite such past hardships, the mood was celebratory during the Zoom-aided interview with MPA. Garg has pinned his hopes on the “one day mortgage” product rolled out in January. “It allows the consumer to come inline, get pre-approved, lock their rate, upload a few documents and within the space of 24 hours get a binding commitment letter to fund their mortgage from Better, which we believe is an industry first and is substantially faster than the average 45 days through traditional process.”
Company officials ticked off other benefits resulting from its public status, including:
- Additional capital will allow Better to continue developing innovative technology including Tinman, its proprietary loan origination platform, to improve internal efficiency and streamline the homeownership experience for customers;
- Better is a leading digital homeownership company and has surpassed $100 billion in funded loans;
- Better and Aurora successfully completed a business combination despite difficult market conditions, positioning the combined company for long term success across cycles.
Officials also touted the company’s Tinman technology platform – dubbed as the world's only supervised learning model in the mortgage business – allowing for faster and less expensive service.
“Since day one, we set out on a mission to create better solutions for one of life’s most important investments,” Garg said. “Today, we’re proud to take a huge step in expanding our capacity to innovate the homeownership process by becoming a publicly listed company.”
But he noted the listing was no finishing line: “While this is a time for celebration, our journey is far from complete,” he said. “With the support of our tremendous team, our innovative technology, and additional capital from SoftBank, Aurora, NaMa Capital (formerly Novator Capital), we are well-positioned and eager to forge ahead and continue pushing the boundaries of innovation in homeownership for our customers and shareholders.”
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