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Note that this article has new information compared to the previous articles about the Zenefits incident. (namely, a16z's involvement as the catalyst for the ouster)
And also (I think) the fact that Parker created the Macro™.
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http://www.buzzfeed.com/williamalden/zenefits-program-let-in...
$4.5 billion valuation on $60 million annual revenue from non-compliant activity? Anyone know the investment thesis on that?
A lot of the HN-cynic crowd is forgetting here that if anything, they were bypassing stupid sets of regulations. There is nothing ethically or morally wrong here.
Or, at most, I will concede that it is not ethically and morally wrong if we concede that the United States is a plutocracy and not a democracy, and there's nothing ethically or morally wrong with a plutocracy.
If these laws are in fact stupid, get them changed. You have tons of money and tons of happy users, right?
I don't buy this. I have no issues with Zenefits and I am actually happy they were able to see phenomenal growth. However I must say this whole situation of the CEO stepping down feels staged to me. It is as if everyone was in on it and this move was calculated by all of them a long time ago. Like when we ready and my stocks are safe and sound blame it on me.
I'm not sure there's a whole lot from this story to apply elsewhere. David Sacks is who you want to be running the show. He has 2 fairly epic successes under his belt (PayPal and Yammer), one of the keenest product minds in the business, nearly unlimited access to funding and talent, moral authority as a founder and lawyer and operator to clean up the mess, etc.
Considering Airbnb and Uber, two of the largest and considered most-successful startups are carefully dodging the law, the upside is worth the risk. I disagree with it, but I think VCs don't care much about following legal frameworks until it's too late.
$4.5 billion valuation on $60 million annual revenue from non-compliant activity? Anyone know the investment thesis on that?
Fastest growing SaaS business ever? The non-compliant activity was not crucial for success and easily rectified. The service offered is core to pretty much every business on the planet and touches every single employee in the business.
Clearly someone bought in to the pitch, but what strategy would they believe would easily rectify this situation?
Considering Airbnb and Uber, two of the largest and considered most-successful startups are carefully dodging the law, the upside is worth the risk. I disagree with it, but I think VCs don't care much about following legal frameworks until it's too late.
Does anyone have any more information about the "52 hour online training program" that "the Macro" allowed them to skip? If that training program is any bit as useless as "online driving school", I can sort of understand how the Macro came to be...
It really is a pity we live in a world where a few can ruin the party for all. I'm sure there are worthy startups out there with a solid product, solid team, and solid practices but they may suddenly die out from VC capital because of the fear/panic triggered by the couple of bad ones.
Presumably if they indeed have a solid product, they have a solid way to drive revenue and be self-sustaining in case of events such as this.
It then takes an abrupt turn and starts repeating everyone's favorite Silicon Valley trope du jour: the unicorn bubble is bursting, the fundraising environment is tightening up, and the halcyon days of multi-billion dollar valuations for everyone are over.
There's really no connection between the two.