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After Zenefits, Will VCs Rein in Their Unicorns?

bloomberg.com

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Re: After Zenefits, Will VCs Rein in Their Unicorns?

#121

Post by salem »

pjc50 wrote: post #111
VeejayRampay wrote: post #108

Earlier quoted context omitted.

Serious question: what is Uber/Lyft specific about a customer being assaulted? Is that inherently different than rapes or assaults by taxi drivers? Cause I'm sure there's been plenty of cases. Don't get me wrong, those are horrific, but I guess I'm failing to see what in Uber or Lyft makes it easier to happen or why it might require special regulation. Maybe the fact that cab drivers need a licence and are thus scree…

Taxi drivers have a licence to lose.

But maybe a better chance of getting away with it

Re: After Zenefits, Will VCs Rein in Their Unicorns?

#122

Post by tjl »

pbreit wrote: post #93
skewart wrote: post #62

A number of commenters here have compared Zenefits' questionable compliance with Uber, Lyft, and Airbnb. What Zenefits was doing is fundamentally different, and much more problematic. Lyft and Uber skirt similar kinds of seemingly useless regulation but they're completely up front about it. They don't pretend that their drivers are licensed or get any benefit from having licensed drivers in any way. They're simply of…

I think the bigger difference is that the rules that Uber, Lyft & AirBnB are bending directly result in customer benefit whereas in the Zenefits case, there is little or no or even negative customer benefit. Here's a good take: https://stratechery.com/2016/zenefits-and-regulation/

AirBnB might benefit the customer, but can negatively impact others in the area. For example, if someone is renting out an apartment in a secure building, just giving the keys to an arbitrary someone you're decreasing everybody else's security. Similarly for a house, if a house is being regularly rented by different people, it impacts the rest of the neighbourhood.

In my building, renting out with something like AirBnB is against their occupancy agreement. While I don't know everybody in my building, I certainly know everybody on my floor. I used to know everybody in the building, but a number of people have moved out and I haven't learnt all the new people yet. I'd be really pissed if I found out that someone was offering an AirBnB rental right next to me.

Re: After Zenefits, Will VCs Rein in Their Unicorns?

#123

Post by cylinder »

sandworm101 wrote: post #40
mrshoe wrote: post #30

This story starts out reporting on a board ousting a CEO after a public scandal involving non-compliance with various laws, which incited multiple government investigations. 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…

Successful startups all, and I mean ALL, have serious compliance issues. They probably do not not realize their problems. Some actively try to avoid knowing, such as by shunning legal advice that may inform them of inconvenient obligations. Part of the going public and/or being bought out process involves measuring the rate of non-compliance. A unicorn wants to go public, but that means first getting your compliance…

This is a startup that literally sells compliance services! The fact that SVers are dismissive of this is actually very troubling.

Re: After Zenefits, Will VCs Rein in Their Unicorns?

#124

Post by sandworm101 »

cylinder wrote: post #123
sandworm101 wrote: post #40

Earlier quoted context omitted.

Successful startups all, and I mean ALL, have serious compliance issues. They probably do not not realize their problems. Some actively try to avoid knowing, such as by shunning legal advice that may inform them of inconvenient obligations. Part of the going public and/or being bought out process involves measuring the rate of non-compliance. A unicorn wants to go public, but that means first getting your compliance…

This is a startup that literally sells compliance services! The fact that SVers are dismissive of this is actually very troubling.

They have fallen into an ignorance trap. Too many thing that all regulation/paperwork is just a pointless homage to entrenched power. They think it cool to bypass red tape. They think they know better. They forget that those silly lectures often contain really important information, that someone with far more experience than they decided that regulation was needed.

Re: After Zenefits, Will VCs Rein in Their Unicorns?

#125

Post by themagician »

Pyxl101 wrote: post #85
themagician wrote: post #71

Earlier quoted context omitted.

Lyft, Uber, and Airbnb can't avoid regulation forever. They've just been lucky so far. Eventually there will be a high profile incident—someone important will get raped or murdered. The political response will be 1000x what their lobbyists can handle. It is inevitable. The reality is that this is how a lot of regulation starts. It doesn't always come from an anticompetitive place. We just forget that we actually aske…

What regulation are Lyft and Uber allegedly skirting?

Lyft's entire business model skirted regulation. At least when Uber started they required all drivers to have passenger carrier permits and commercial insurance. Then Lyft comes around and completely ignores the law. Completely. Uber starts losing business, and so then Uber responds in kind with UberX.

Now it's legal because it flies under the banner of "rider sharing". But we all know that there is really no sharing to be had. It's just a for hire service. The regulation will return, eventually.

Re: After Zenefits, Will VCs Rein in Their Unicorns?

#126

Post by rmc »

discodave wrote: post #82
themagician wrote: post #71

Earlier quoted context omitted.

Lyft, Uber, and Airbnb can't avoid regulation forever. They've just been lucky so far. Eventually there will be a high profile incident—someone important will get raped or murdered. The political response will be 1000x what their lobbyists can handle. It is inevitable. The reality is that this is how a lot of regulation starts. It doesn't always come from an anticompetitive place. We just forget that we actually aske…

And by important you don't mean the women who have already been raped or assaulted by Uber drivers right?

They probably mean American women.

Re: After Zenefits, Will VCs Rein in Their Unicorns?

#127

Post by loumf »

yummyfajitas wrote: post #118
patio11 wrote: post #50

Earlier quoted context omitted.

California requires 20 hours of training to get a license for health and accident insurance, 20 hours to get a license for life insurance, and an additional 12 hours on ethics training for people wanting to pass the exam for either. These are tick-box requirements that allow you to take the exam you need to pass to get the relevant license. Several providers have online courses you can take for $50 Here's the regulat…

As further detail, the way these things work is the following. The "training" consists of watching some powerpoints and listening to a voiceover reading the slide. You can't click "next slide" until the voiceover has finished. The voiceovers add up to 52 hours. Typically the voiceovers are short, e.g. 60 seconds, to ensure that you are actually at your computer clicking "next" rather than just letting the voiceover r…

Also, at the end they have you attest that you actually did the training under penalty of perjury. Zenefits instructed their employees to lie instead.

Re: After Zenefits, Will VCs Rein in Their Unicorns?

#128

Post by shanacarp »

manishsharan wrote: post #77

Can someone tell me why is it such a big deal when person sells an insurance without having a proper license? Its not as if the insurance policy itself is fraudulent. The buyer is buying the insurance policy and not the credentials of the broker. Other wise it seems to me that is requirement is just as unnecessary as requiring cosmetology license for hair braiding ( see http://www.texastribune.org/2015/04/06/bill-wou…

It is for a similar reason why buying from a broker stocks, bonds, futures, ect have to pass the series 7 and 63/65/66 from FINRA. Insurance is a financial product, letting someone buy the wrong insurance because they misunderstand it and you will make more money from that purchase is a form of fraud.
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