Better.com, a fintech startup, has decided to exit the real estate business. On June 7, the company laid off its real estate team and is reportedly transitioning from an in-house agent model to a partnership agent model. Sources have revealed that the affected agents received minimal severance, despite previously experiencing a salary cut of over 50% in November to secure their positions. The exact number of people impacted by these changes remains unclear. When contacted for a statement, Better.com declined to comment on the matter.
The recent news of Better.com exiting the real estate business doesn’t come as a surprise, considering the speculations that have been circulating for some time. The housing market slowdown caused by increasing mortgage interest rates has contributed to this decision.
As early as April 2022, reports were suggesting the possibility of scrapping Better Real Estate entirely. Previously, Better.com had emphasised its intention to enhance the home purchasing experience and expand its offerings beyond digital lending, leading to the company rebranding from Better Mortgage to Better. The company had plans to invest significantly in its real estate unit in 2022, which was considered a crucial part of its growth strategy.
Better.com has been generating attention due to its ongoing layoffs, starting with the high-profile event in December 2021 when approximately 900 employees were laid off via Zoom. Since then, the company has been carrying out smaller-scale layoffs in a systematic manner, according to insider sources. Besides, Better.com had already undergone its fourth round of layoffs last August since the previous December.
The company has gained a reputation for handling these layoffs in a manner that lacks sensitivity. Within less than nine months, it terminated the employment of thousands of workers, witnessed the departure of several senior executives, and faced delays in its planned Special Purpose Acquisition Company (SPAC) efforts, although it maintains that it is still working towards it.
According to an anonymous source familiar with the matter, Better.com had ambitions to cover various aspects of home ownership. The company dedicated resources to developing consumer experiences and agent-oriented tools for its Better Real Estate division, such as their initial native mobile app. However, not all of these initiatives were realised due to the company’s changing circumstances and business trajectory.
Source: News18
