Zenefits Burning Through $200M A Year, CEO To Step Down

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Zenefits Burning Through $200M A Year, CEO To Step Down

The last couple of years have been a rollercoaster for HR software provider Zenefits. As recently as last September, the company was a darling of Silicon Valley, having graduated from the prestigious accelerator Y Combinator and raising millions in venture capital from top firms. It achieved unicorn status at the height of the classification’s coolness, securing a $500 million+ Series C last May at a whopping $4.5 billion valuation.

Zenefits

Then, sparked by a BuzzFeed report last November, its empire began to crumble. Will Alden of the online media company discovered that more than a handful of Zenefits employees were operating as insurance brokers without the proper licensing. In a follow-up article, Alden reported the company had also developed software that allowed salespeople to cheat state certification processes, essentially enabling widespread fraud. From there, the bad PR piled on; one of the more widely spread articles purported the company had a drinking-centric culture, similar to a fraternity.