Better’s 90% Stock Fall: Why Vishal Garg Lost the CEO Job
If your founder can turn a board meeting into a hostage situation, you do not have founder-led culture. You have a governance failure with better branding.
Better Home & Finance did not have a CEO transition. It had a public eviction followed by a bar fight over the keys.
That is the blunt read on Vishal Garg’s removal as chief executive, Daniel Lewis’s appointment as interim CEO, and the founder’s subsequent campaign to unseat the board that removed him. And it should make every founder and director a bit uncomfortable, because this mess was not created in a week. It was allowed to compound for years.
The board finally chose the company over the founder
On August 3, 2026, Better announced that board member Daniel Lewis had been appointed interim CEO, replacing founder Vishal Garg. The first version of events was polished: Garg and the board had “mutually agreed” to the transition, and Garg would remain a director to help with an orderly handover.
Nice words. Then the paperwork and the public fight arrived.
Better later said that every director other than Garg supported moving away from founder-led leadership. The company’s lawsuit and public statements have described Garg’s effort to return as a campaign to remove directors and reinstall himself as CEO. Garg, for his part, has challenged the board and Lewis, sought shareholder support, and argued that the board’s conduct is the real problem.
That is what happens when a board waits too long to draw a hard line. The decision itself becomes the beginning of the crisis rather than the end of it.
Lewis is not some random caretaker wheeled in from a big consulting firm with a folder full of PowerPoint slides. He joined Better’s board in late July after working with the company on cost reductions, enterprise partnerships, strategic planning and operations. He previously ran Ascend Fundraising Solutions and founded Orange Capital, an investment firm focused on special situations.
That background matters. Better did not pick a visionary storyteller. It picked an operator with governance and capital-markets scars. In a company fighting for credibility, that is the job.
The numbers made the romance impossible
Founders get a lot of grace because they create things from nothing. Fair enough. I have built businesses. I know the founder is often the person willing to take the first insane risk when everyone else is safely offering opinions from the sideline.
But being the founder is not a lifetime exemption from performance, judgment or basic adult behaviour.
According to Better’s allegations in its lawsuit, as reported by [Forbes](https://www.forbes.com/sites/tylerroush/2026/08/18/ceo-who-fired-900-people-on-zoom-allegedly-calling-employees-monkeys-faces-lawsuit-from-his-company/), the company had accumulated net losses exceeding $1.5 billion since 2022, while its share price had fallen more than 90% under Garg’s tenure. Those facts do not prove that one man caused every problem. Mortgage markets have been rough, capital has become more expensive, and public-company life is not kind to unprofitable fintechs.
But boards are not paid to find excuses that sound sophisticated. They are paid to decide whether the person running the business gives it the best chance of surviving and winning.
Better was once one of the loudest names in digital mortgages. Before going public through a SPAC merger in 2023, it had processed more than $110 billion in loans. It also built Tinman, its loan-origination platform, and Betsy, an AI assistant that Better says helps automate mortgage workflows.
There is real business there. That is exactly why the governance failure is so costly.
A troubled company can be repaired. A company whose leadership team, board and founder are spending their days fighting over control is busy setting fire to the repair manual.
The culture warning signs were not subtle
This is the part founders hate hearing: culture is not the snack cupboard, the offsite or the value words painted on the reception wall. Culture is what the boss can get away with when money is flowing.
Garg’s reputation was already battered long before this month’s boardroom fight. In 2021, he became infamous after laying off roughly 900 employees on a Zoom call. Reports and later company filings also described accusations that he used demeaning language toward staff. An internal review after the earlier controversy found that he had failed to set an appropriate tone at the top and that weaknesses in culture and controls hurt the company’s ability to capture potential customers.
That is the whole story in one sentence: bad leadership is not merely offensive. It is commercially expensive.
Too many boards treat a founder’s behaviour as a private HR issue until it becomes a public valuation issue. They tell themselves the person is difficult because they are brilliant, or demanding because standards are high, or explosive because they care deeply.
Sometimes that is true. More often, it is cowardice dressed up as nuance.
High standards are brilliant. Humiliating people is lazy management. Demanding clear numbers is leadership. Creating fear so nobody brings you bad news is how you get bad numbers.
The overlooked angle: the board owns this as well
It would be too easy to make this a simple story about a controversial founder getting his comeuppance. That makes for a satisfying headline, but it lets directors off the hook.
Better’s board knew who Garg was. The behaviour that made him notorious was not uncovered by a forensic audit last Tuesday. And after he was placed on leave following the 2021 layoffs, he returned as CEO in 2022.
So the more useful question is not, “Why did Vishal Garg behave like Vishal Garg?” Everyone had plenty of data on that.
The useful question is: why did the board permit the risk to remain concentrated in one founder for so long?
Boards often confuse access with control. A founder may own votes, hold institutional memory, know the product better than anyone, charm investors and move faster than a committee. None of that means the board should tolerate a structure where removing the CEO threatens to destabilise the entire company.
That is not founder alignment. That is succession failure.
Better’s current conflict makes the cost visible. Garg’s group sought written consents to remove five directors, including Lewis and chair Harit Talwar. The company responded with a consent-revocation campaign, legal action and, on August 20, a limited-duration shareholder rights plan.
A poison pill is not a management strategy. It is a seatbelt deployed after the car has already hit the tree.
The board may be right to defend the company from what it calls a disruptive campaign. But directors everywhere should notice the deeper lesson: if your succession plan starts only when the founder becomes impossible, you do not have a succession plan.
Daniel Lewis now has the least glamorous job in fintech
Lewis must do three things, in that order.
First, stabilise the company. That means employees need to know who makes decisions. Customers and enterprise partners need to know contracts, service and product road maps are not hostage to a shareholder dispute. Investors need clean, prompt disclosure rather than competing claims on social media and television.
Second, simplify the operating plan. Better does not need an inspirational manifesto right now. It needs a small number of measurable priorities: sustainable loan economics, customer conversion, enterprise growth, cash discipline and product reliability. Pick the scoreboard. Publish it internally. Review it relentlessly.
Third, rebuild the leadership bench. A business cannot be dependent on one founder, one interim CEO or one heroic executive. The next permanent CEO decision should be the result of a real process, not an emotional reaction to the latest court filing.
The temptation will be to sell a grand turnaround narrative. I would resist it. In difficult businesses, credibility returns through boring execution: fewer surprises, clearer accountability, stronger controls, better people in the right seats and numbers that gradually stop embarrassing you.
What this means for you
Whether you run a startup, sit on a board, manage a team or invest your own money, steal these rules.
Separate talent from tolerable risk. A founder can be exceptional and still be the wrong CEO for the company’s next stage. Say it early, before the decision becomes a blood feud.
Build succession before you need it. Identify who can run the business tomorrow, who could run it in 12 months, and what gap each person has. If the answer is “only the founder,” fix it now.
Make culture measurable. Track regrettable departures, employee complaints, customer churn, missed forecasts and the speed at which bad news reaches senior leaders. Culture always leaks into the P&L eventually.
Do not confuse public noise with shareholder support. Garg’s campaign is a reminder that headlines, tweets and declarations of backing are not governance. Read the filings. Count the votes. Know the rules.
If you are an investor, price key-person risk properly. When a company’s identity, operating model and capital structure are all tangled around one individual, that is not founder magic. It is concentration risk.
The real lesson from Better is not that founders are dangerous. Founders are necessary.
The lesson is that no one gets to be bigger than the company they built. Not when staff livelihoods, customer trust and shareholder capital are on the table. If you cannot build an organisation that survives your absence, you have not built a business. You have built a very expensive personality cult.