Updated Tuesday, February 9, 2016
How the mighty have fallen.
On Monday, February 8, 2016, outspoken CEO of Zenefits Parker Conrad stepped down amidst allegations that the company’s salespeople were acting as insurance agents without proper licences in seven states. In a company-wide email sent to Zenefits employees on Monday, the company’s COO, David Sacks, admitted that some of the decisions Zenefits made under Conrad were “just plain wrong.”
Up until now, Zenefits, the wunderkind of the HR technology world, has certainly seemed invincible. It seems like they’ve got the whole world (and many investors) convinced that their “Software as a Service” HR model is so revolutionary that it will forever change the way businesses buy and use human resources information systems.
Of course, not everyone was convinced. In fact, several industry thought leaders have made their skepticism that the company could live up to the $4.5 billion valuation the company received in May well known.
Here are some of the reasons why experts are convinced that Zenefits will be the biggest bust in SaaS history:
With the benefits administration and HCM market expected to reach $16.4 billion (North America) and $15.4 billion (worldwide), respectively, by 2017, can Zenefits really expect to garner a quarter of that market share in just two short years? That’s what its investors believe, but we’re not so sure.
The one thing the meteoric (albeit inflated) rise of Zenefits has shown us for sure is that employers’ expectations are high when it comes to technology platforms and integration. But while today’s entrepreneurs and business owners might be initially swayed by a brilliant design, the “honeymoon” period is quickly over for HR technology vendors who fail to deliver on much else. This is a lesson that HR technology companies like Zenefits have historically learned the hard way, much to their customers’ dismay.
Employers shouldn’t have to settle for “software as a service” – they deserve software with the service, and that’s exactly what they get with G&A Partners. As a leader in the PEO and HR outsourcing industry, G&A combines innovative technology and more than 20 years of HR expertise with outstanding service to deliver a solution that is both high-tech and high-touch.
To learn more about how G&A Partners can help you grow your business, call 866-634-6713 to speak with an expert or visit www.gnapartners.com/get-started to schedule your free business consultation.