Resource Actions: Parker Conrad is back, back again
Editor's note: Welcome to Resource Actions, our occasional, back-and-forth column covering everything from the bizarre to the day-to-day that, despite everything, impacts HR departments. Please feel free to send all tips, thoughts and new HR startup concepts to [email protected] and [email protected].
Kathryn Moody: By now there is probably an adage about HR that goes something like, "If you do a task, no matter how trivial, there will be tech for it." Sadly, there's no Bruno GIF for that.
But HR hasn't always had such an embarrassment of riches, which is why we keep coming back to Zenefits and its strange story. Now a slew of one-stop-shop platforms seek to find every loose process and put it all in one place for ease of access. Zenefits, even with its compliance problems, likely inspired a few of these new players (or at the very least, made the most noise at the right time).
But Conrad is an interesting story on several levels. Zenefits as a startup struggled to manage its massive growth and climbing expectations in an industry that requires heavy compliance, leading to clear missteps and Conrad's sacking.
Sometimes you can shake things up and speed past everyone else. Sometimes everyone is in the slow lane for a reason.
I've written extensively in the past on how and why startups — Zenefits in particular — struggle with the balance to be both unicorn and compliant corporate player. Can Conrad overcome this?
Ryan Golden: Oh, absolutely. Regardless of how uneasy it will make regulators, I don't believe there's any doubt left in the business community that Conrad's initiative to create Zenefits was simply genius.
There's a reason why the company was so lauded after its debut: It emerged to automate and innovate in a space that few really considered. Vanity Fair said it was "once the envy of Silicon Valley" for that reason. Some might say it would have been only a matter of time, but I don't think that diminishes what Conrad achieved.
But prospects for success and, well, successful management are completely different things. There were some concerning aspects of Conrad's leadership (compliance issues aside) that we'll have to consider.
One of them is the projection of confidence in one's enterprise, which is not done best by selling off massive amounts of one’s stock in the company before the reveal of a major scandal. I’d expect investors to be wary of such actions going forward.
The other one I’ve noticed is, quite simply, accountability. Not only was Conrad accused of providing insufficient training to employees, but he also reportedly blamed his replacement, David Sacks, for the firm’s troubles.
Still, it’s hard to think the embattled CEO hasn’t learned these lessons on his own throughout this ordeal. VCs appear to have given him the benefit of that doubt, which observers have (not-so-warmly) pointed out.
Kathryn Moody: I for one would probably have considered it a little bit longer, but maybe that's why they have gobs of money.
Things have changed since he founded Zenefits. He's no longer the only or best player in the game. Flock, Gusto, Zenefits, Namely and BambooHR are all names that come to mind when I think about HR tech platforms oriented for small business, and that’s not even including others that are particularly focused in healthcare or recruiting or even onboarding, which Conrad hopes to delve into. The industry, once considered too boring for innovation, is reaching a saturation point.
Will name recognition help him? It's possible. Like you said, Zenefits was a VC darling for a reason.
But Silicon Valley likes to see growth in one way, and that’s exponential. We keep seeing, time and time again, what happens when these companies prioritize growth or speed or “the hustle” over sustainable, employee-supportive processes.
Uber is Enemy No. 1 currently — other Valleyites even express weirdness about hiring people from the company — but that’s only because they are the latest example to epitomize how easy it is to feel like everything's going right when it may be rotting underneath.
Did Conrad learn that lesson, too?