Human Resources software company Zenefits has hired Jay Fulcher — former CEO at software startup Ooylah and Agile Software Corp — as its new CEO, replacing David Sacks, per WSJ. Sacks, who announced plans for his departure in early December, wrote an email to employees explaining that the hire was "the last step in a planned transition that began one year ago this week." Sacks will remain on Zenefits' board.
Challenges ahead: As the new CEO, Fulcher is expected to ramp up Zenefits' momentum following a rocky two years during which the company has undergone a series of layoffs after sales have plateaued. As the WSJ points out, these issues led to a rare move in which Zenefits revalued its own shares down to $2 billion from $4.5 billion to help fund investor lawsuits.
Fulcher will also need to help ease concerns following a company-wide scandal in which staff brokered health benefits without securing proper licenses. The incident led to other skeletons in the closet being publicly leaked, like the company's frat-house reputation for hosting overindulgent office parties.
Bottom line: As Sacks has said, his time as Zenefits' CEO was never meant to be permanent, though he did help the company smooth over some of its regulatory issues and clean up its rowdy culture. Now all eyes are on Fulcher to see if he can restore Zenefits' former standing as the next "It" startup.
This story was updated at 5:32pm to reflect comment from Zenefits.