Interest rates can complicate capital strategy, so it’s no surprise that it’s a top of mind issue for finance leaders. A recent Deloitte survey found that interest rates were a top external risk among CFOs. And while interest rates are finally on the decline, it’s been an otherwise tough environment.
It’s one thing being a finance executive of nearly any organization during periods of high interest rates. Leading the finance function of an online mortgage lender, where interest rates are a key driver of consumer demand, is like playing CFO on hardcore difficulty.
That’s the challenge facing Kevin Ryan, CFO of Better Home & Finance. The company, which operates the website Better.com, is playing in what Ryan described as a “challenging market environment” but also has its sights set on reaching EBITDA breakeven by Q3 of next year.
Ryan’s focus during this period has been to get Better leaner and meaner so it can work toward its goal even amid a drastically shrinking market.
The mortgage market ain’t what it used to be. According to Ryan, back in 2021, Better had $58 billion in mortgage volume and raked in $1 billion of revenue. Better recently reported approximately $44 million in Q2 revenue, much smaller than in its heyday, but a $12 million YoY improvement. But the mortgage market was much bigger four years ago, Ryan said.
Residential mortgage origination volume totaled roughly $4.1 trillion in 2021, according to Federal Housing Finance Agency data. Origination volume fell precipitously to $1.3 trillion in 2023. Origination volume during the first three quarters of last year, which was the latest data FHFA had available, totaled nearly $1.1 trillion.
“The industry in 2025 is half the size of what it was in 2021, and we, and all our competitors…are dealing with that,” Ryan said.
In order to grow its business, Better has had to carve off a larger piece of a smaller pie. In Q2, the company reported a 25% YoY increase in funded loan volume to $1.2 billion, and a $5 million YoY improvement in net losses. Its EBITDA loss grew by $4 million YoY in Q2, but improved by $13 million from Q1.
Ryan noted that other factors, such as housing availability and the number of people moving, also shape the mortgage market.
But he said, “probably the largest driver of mortgage demand is how much [it costs] to get a mortgage.” Ryan said that the market should grow again once rates come down. (Our interview took place before the Fed announced plans to cut rates.)
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Cost discipline is the name of the game when on a shrinking playing field. Better has tackled the marketwide problem by cutting costs and investing in technology to improve its processes, Ryan said. It’s a strategy—controlling costs while prioritizing tech investments–that many other finance leaders are employing, per a June RGP survey.
Better’s technology investments have a few benefits, he said. They create a better user experience, put Better in a stronger position to take advantage of a market rebound, and reduce the cost to write a mortgage—so Better has more cash to use elsewhere.
“For each loan we make, it costs us less per loan as a result of the AI and tech investments we’ve made,” Ryan said. “That allows us to spend a little more money on marketing [and] pass a little bit better rate through to the customer, so that it makes the mortgage on the margin a little more attractive for the consumer.”
Ryan said that, at a basic level, creating a mortgage is not much different than making a can of soda. Being able to offer that can for $1.50 instead of $2 means the customers who would have bought one for $2 are happy, but those who would have otherwise passed on it may now get out their wallets.
“But that presupposes you can make money at [a] lower cost to the consumer,” Ryan said. “That requires us to really manage our expenses, invest in technology, automate more so that we can manufacture at a lower cost.”
As CFO, Ryan said he regularly looks at the cost of writing a loan, identifies where the inputs are most expensive, and figures out how to make those parts of the business more efficient. This may be through cutting down on vendor costs or identifying new near-term growth opportunities.
“A lot of being a CFO is a capital allocation question,” he said. “I have a fixed amount of capital, and how do I want to allocate it? Trying to develop a real capital allocation policy is important.”