Better.com stock tanks after going public + SPAC Merger
Better.com, the digital mortgage company, finally went public. Shareholders had approved better.com to merge with Aurora Acquisition Corp through a SPAC deal. However, its stocks dropped to merely $1.19. Right before they officially went public, Shares of SPAC partner Aurora were trading at $17.45.
Better.com had initially planned to go public in 2021 at a $7.7 billion valuation when mortgage interest rates were lower and business was booming. The company even claimed to have $500 million in profits. Nonetheless, due to existing homeowners refinancing their mortgages, they began to lay off workers from the end of 2021 throughout 2022 to stop themselves from bleeding out in cash. Moreover, they suffered from multiple high-profile missteps and bad publicity. This included the wastage of $200 million and the investigation for potential violations of federal securities laws and other issues.
Despite all the backlash, the company expresses optimism for the future due to a $550 million boost in new capital from SoftBank. In contrast, investors don’t share that same optimism.
