Better.com, the digital mortgage lender that became a cautionary tale of startup excess during the pandemic boom, has appointed a new chief financial officer with deep roots in insurance and technology sectors. The move signals the company’s continued efforts to rebuild credibility and establish sustainable financial operations following years of turbulence that included mass layoffs, executive departures, and a failed SPAC merger.

The online lender announced the hiring of a finance executive with experience at Aetna and IBM, according to CFO Dive. This strategic appointment comes as Better.com works to stabilize operations and rebuild trust with investors and customers alike after a tumultuous period that saw the company’s valuation plummet from its 2021 peak of approximately $7 billion.

The new CFO brings a wealth of experience from established corporate environments, a stark contrast to the startup culture that previously defined Better.com under controversial founder and CEO Vishal Garg. The executive’s background in navigating complex financial structures at major corporations like Aetna, a CVS Health company, and IBM suggests Better.com is prioritizing financial discipline and operational maturity over the growth-at-all-costs mentality that characterized its earlier years.

From Pandemic Darling to Industry Pariah

Better.com’s journey from fintech darling to cautionary tale has been well-documented in business media. The company gained notoriety in December 2021 when CEO Vishal Garg fired approximately 900 employees over a Zoom call, a move that sparked widespread criticism and became emblematic of poor leadership practices in the tech industry. The incident went viral on social media and prompted intense scrutiny of the company’s culture and management practices.

The mass termination was just the beginning of Better.com’s troubles. In the months that followed, the company faced a exodus of senior executives, questions about its financial projections, and ultimately the collapse of its planned merger with Aurora Acquisition Corp., a special purpose acquisition company. The failed SPAC deal, which would have taken Better.com public, represented a significant setback in the company’s growth trajectory and forced management to reassess its strategic direction.

Despite these challenges, Better.com has continued operations in the mortgage lending space, though at a significantly reduced scale compared to its pandemic-era ambitions. The residential mortgage market has contracted sharply since 2021, with rising interest rates dampening refinancing activity and home purchase demand. According to the Mortgage Bankers Association, total mortgage originations fell from $4.4 trillion in 2021 to an estimated $1.6 trillion in 2023, creating a far more competitive environment for all lenders.

Strategic Significance of the CFO Appointment

The hiring of a CFO with experience at Aetna and IBM represents more than just filling a vacant executive position. It signals Better.com’s recognition that surviving in today’s mortgage market requires the kind of financial rigor and operational discipline typically associated with mature, established corporations rather than venture-backed startups.

Aetna, one of the nation’s largest health insurers with decades of regulatory compliance experience, operates in a heavily regulated environment not unlike mortgage lending. The CFO’s experience navigating complex regulatory frameworks, managing risk, and maintaining relationships with government agencies could prove invaluable as Better.com seeks to strengthen its compliance infrastructure and rebuild trust with regulators.

Similarly, experience at IBM—a technology company known for enterprise-scale operations and financial stability—brings expertise in managing large-scale technology infrastructure investments, optimizing operational efficiency, and maintaining investor confidence through market cycles. These skills are particularly relevant as Better.com works to differentiate its technology platform in an increasingly crowded digital mortgage market.

The Evolving Digital Mortgage Sector

Better.com’s leadership changes come at a pivotal moment for digital mortgage lending. The sector experienced explosive growth during the pandemic as low interest rates and remote work trends drove unprecedented demand for home purchases and refinancing. However, the subsequent rise in mortgage rates from historic lows near 3% to over 7% in 2023 fundamentally altered market dynamics.

Traditional lenders have also accelerated their digital capabilities, reducing the competitive advantage once enjoyed by digital-native companies like Better.com. Major banks and established mortgage companies have invested heavily in online application processes, automated underwriting, and digital closing technologies, narrowing the gap between traditional and digital-first lenders.

The competitive pressure has forced digital mortgage companies to focus on operational efficiency and profitability rather than market share growth. Several digital lenders have scaled back operations, laid off staff, or exited the market entirely. Better.com’s survival and continued operation, despite its well-publicized challenges, demonstrates some underlying strength in its business model and technology platform.

Financial Restructuring and Path Forward

The appointment of an experienced CFO with a corporate background suggests Better.com may be preparing for another attempt at accessing public markets or securing significant private investment. Companies typically bring in seasoned financial executives when they need to strengthen financial controls, improve reporting capabilities, or prepare for major transactions.

Better.com has reportedly been working to streamline operations and reduce costs since the failed SPAC merger. The company has conducted multiple rounds of layoffs beyond the infamous Zoom terminations, reducing headcount to align with lower origination volumes. These restructuring efforts, while painful, may have positioned the company for sustainable operations in a smaller but more stable mortgage market.

The new CFO will likely face immediate priorities including managing cash flow in a challenging origination environment, optimizing the company’s cost structure, and maintaining relationships with warehouse lenders and other funding sources critical to mortgage operations. Longer-term objectives may include preparing financial statements for increased scrutiny from potential investors or public market regulators.

Leadership Stability and Cultural Transformation

Beyond financial management, the CFO appointment may signal broader efforts to transform Better.com’s organizational culture. The company’s previous reputation for aggressive management practices and high employee turnover created recruitment and retention challenges that undermined operational stability.

Bringing in executives from established corporations known for more traditional management approaches could help Better.com develop a more sustainable workplace culture. This cultural evolution, combined with operational maturity, may be necessary for the company to attract and retain the talent needed to compete effectively in the mortgage technology space.

The mortgage industry, while embracing digital transformation, remains relationship-driven and reputation-sensitive. Better.com’s ability to rebuild its standing with real estate professionals, title companies, and other partners in the home buying ecosystem depends partly on demonstrating stable, professional leadership. A seasoned CFO can contribute to this credibility rebuilding effort through consistent communication and reliable financial performance.

Market Conditions and Future Outlook

The timing of this appointment coincides with cautious optimism about mortgage market conditions. While interest rates remain elevated compared to pandemic-era lows, many analysts expect modest improvement in origination volumes as the housing market adjusts to the new rate environment and inventory constraints gradually ease.

Better.com’s technology platform, which automates much of the mortgage application and underwriting process, could provide advantages in a market where efficiency and speed matter more than ever. Borrowers in a higher-rate environment are often more rate-sensitive and willing to shop among multiple lenders, potentially benefiting digital platforms that can deliver quick pre-approvals and competitive pricing.

However, significant challenges remain. The company must continue managing costs carefully while maintaining the technology investments necessary to stay competitive. It must also overcome lingering reputational damage from past controversies and prove it can operate profitably across market cycles. The new CFO’s ability to balance these competing demands while positioning the company for potential future growth will be critical to Better.com’s long-term viability in the evolving digital mortgage sector.