When your board votes unanimously to remove you, the playbook says you exit gracefully. Vishal Garg, founder of Better Home & Finance, chose a different path — and now his own company is suing him.
Better Home filed a complaint Tuesday in the U.S. Southern District of New York, accusing Garg of running an illegal scheme to reinstall himself as CEO after the board ousted him on Aug. 3. The board's vote was unanimous, excluding Garg himself.
The numbers that triggered the exit
The board's rationale was not ambiguous. According to the complaint, Better Home has posted net losses exceeding $1.5 billion since 2022, and its stock price has fallen more than 90% under Garg's tenure. For a company that processed more than $110 billion in loans and went public through a SPAC merger in 2023, that is a steep destruction of shareholder value.
The alleged campaign
Rather than stepping back, Garg allegedly launched what Better Home calls a 'campaign of retribution.' On Aug. 10, he sent a letter demanding the immediate resignation of every board member. He then claimed — in press releases, text messages, social media posts, and a Bloomberg interview — that he had 'already corralled 52%' of the shareholder vote to return himself to the CEO seat.
Better Home alleges none of that shareholder solicitation was accompanied by the proxy statements required by the SEC, a potential violation of two federal securities laws. The company is asking the court to void all shareholder approvals Garg collected and to bar him from soliciting further support for at least 30 days.
Garg's own public statements shifted quickly. On the day of his departure, he called incoming CEO Daniel Lewis the 'right person to lead the company.' By Aug. 15, he was posting on X that 'the only people who may have committed securities law violations are Daniel Lewis and the board.'
The culture problem that predated the financials
The lawsuit also surfaces a pattern that employees had flagged for years. According to the complaint, employees allege Garg referred to staff as 'mortgage monkeys.' He previously called his team 'dumb dolphins' in an email and, in 2021, fired 900 employees on a Zoom call before later calling them 'lazy.' An internal review found he 'failed to set a tone at the top that supported a strong culture of internal controls' and that the firm had become 'less effective than others in our industry at capturing potential customers.' Garg was placed on leave after the Zoom layoff, then reinstalled as CEO in 2022.
The editorial read
This is what happens when a board tolerates a founder's behavior through one crisis, reinstates him, and then faces a second, larger reckoning. The $1.5 billion in losses and the 90% stock collapse are not abstract governance failures — they are the measurable cost of letting culture and accountability slide.
For founders, the lesson is structural: boards exist to protect shareholders, not founders. When the numbers break badly enough, even a founder's equity and charisma run out of runway. Build the culture and the controls before the board has to.
