Operating With Integrity | Zenefits CEO Jay Fulcher

Good.

Yeah, and I think that's the entrepreneurial mindset that you guys all have. To talk a little bit about that entrepreneurial mindset, you know, you started and grew your way through many companies. You started— were part of the start of a startup, but most of your career has always been coming in as the operational role, if I'm not mistaken. For those of us thinking of starting a business just for the sake of starting a business, and you recommended that, hey, go work at a bigger company, go learn from mentors. How can they still be entrepreneurs within these companies?

Great question. For me, it's kind of interesting. Up until I was sort of 35 or so in my career, I actually did work for mostly the bigger businesses and more established businesses. Since then, I've actually done both. I've started 3 or 4 companies, and I've also joined some that were formed but very early stage. I think the entrepreneurial mindset can show up regardless of what size or scale of company that you're involved in. I think that in some ways, it's exactly what a lot of the bigger companies are looking for from younger generations that are in their workforce. They're wanting to cultivate and create opportunities for guys just like you where you can kind of bring that spirit and that approach to their business so that they're not working in a stale environment where their business potentially is being run maybe the way that it was 3 or 4 or 5 years ago. because the environment really doesn't allow for that. I think you actually can bring that to— that entrepreneurial spirit can be brought to an established business. That being said, I also think that there's really no replacement or there's no substitution for being able to try to launch something that is your own idea. That's an interesting concept. Sometimes you can do that inside of a bigger company. In the company we have right now, we've got some ideas that are being launched internally by our employees who believe that there's a market opportunity that we can exploit, but it happens to be happening inside of Zenefits rather than as a separate company. Occasionally those ideas take flight in such a way that they don't necessarily make sense inside of our company, but they potentially make sense sort of as a spin-out. And in those situations, while I hate losing great talent, I gotta walk the walk, not just talk the talk. And so for a lot of those folks, we help them basically get involved with getting that business kind of fully formed and extricated out of the core business that we have. I think that is the way most tech companies will be operating over the course of the next 20 years. I think most of them understand that in order for us to be able to have great talent that is really motivated around trying to propel their career forward and basically scratch this entrepreneurial itch, you've got to allow them to be able to demonstrate some of that in a less high-risk way inside our businesses and then eventually provide them with the opportunities or the avenues to be able to launch those businesses outside as it makes sense.

How do you guys foster that at Zenefits?

There's a bunch of ways to go about it. First of all, like I said before, it's one thing to talk the talk. You have to walk the walk. when you've got great talent that wants to go do something, but it clearly is not inside or within our mission, we have to have, I think, the courage and in some ways the commitment level to recognize that it's time to let that person or that team spread their wings, potentially even if it means them leaving the company. And so we've got a number of examples of where we have walk the walk, and we've actually, you know, followed through on our commitment to go do that. And what's interesting is that's been a really, really good thing, I think, not only for those entrepreneurs but also for the company. Because what's occurred is inside we find people, you know, daring to think differently about solving some of the problems, daring to think more entrepreneurially about how can I kind of, you know, build something potentially here inside the business, at least initially, to see what could be possible.

possible.

Conversely, we've also had some of those folks go on to do some other things and then return back into the company for a second swing at it, which I think has been a great thing for not just our business, it's a great thing for our customers, it's a great thing for our product, because at that point we don't just have an insular view of what we're building or of our value proposition or, or the problems that we're trying to solve. We, we have people that have been outside the company, they've seen some of these problems from a different perspective, and now they're back in the company helping us to try to solve some of these things. So I think a lot of it is around, as I say, having the— I guess the courage or the audacity to let people experiment inside your company, knowing that that's going to be both a good thing for us in the short term, but it's potentially even going to be good for us in the long term.

This relates to culture a little bit. You talked a little bit about culture before, how ZeniFit had a different culture, and you came in and tried to change some things. What is that culture now, and what are some of the things that you actually implemented to make sure that this big boat of 600, 500 people actually switch over to a new culture?

The first thing, within the first couple of weeks when you sort of lay off half the organization and you kind of do a complete reset organizationally, there's a few things that are sort of just fundamental that kind of need to change. One of the things that we did immediately is we changed our physical location. We left a very good building in downtown San Francisco and just went to a different location because we needed, in my view, we needed a change of venue. We needed a change of scenery. We needed to kind of physically reset people's brain about where they work and what that place looks like and how it operates every single day. So we physically did that. The other thing that we really focused on was trying to make sure that we were a lot more, I'd say, overt and intentional about the values that the company has, how we're going to how we're going to behave. When we talk about culture, by the way, I always think it's kind of interesting to find out if you're asked to describe culture, what do you say? We won't go through that right now, but when you do that, a lot of times people are a little bit like, yeah, culture. Typically, I find that there's a lot of over-architected, overthought definitions. Culture for us at Zenefits, based on my definition, is simply how we do things here. It's not more complicated than this is how we operate. This is how we do things here. That has big implications, everything from how do we interact with each other, how do we treat each other, to how do we treat the outside world, how do we interact with partners and regulators and auditors and all the rest of it. But it also has a lot to say about how are we going to handle accountability, how are we going to handle product deadlines? How are we going to handle, you know, the pressures and the challenges that every tech company has? And so we've tried to reset a lot of that. It starts with some basics around we're going to operate with integrity on everything we do.

Mm-hmm.

So, um, for me, I, I operate with, with the, with the company from a place of radical transparency. I just believe in, um, If you were the employee group, you all voted with your feet to be here, and so by definition, you deserve complete transparency around what's going well, what isn't going well, what are our challenges, what are we doing about them. If there's organizational changes or somebody's been fired or whatever else, it requires some discussion, some explanation. And as a result, I think the company gets stronger because of it.

Thank you.

When things are going really, really well, we've obviously the last year and a half or so, we've been doing really, really well. When things are going really, really well, it's really easy. When things are not going so well or there's a problem or there's a hiccup, then that's when that's tested.

Mm-hmm.

I find that one of the best things the company can do is to model this transparency, which then makes it more of a cultural almost imperative for everybody that, yeah, that's just how we operate. We're gonna shoot each other straight. We're gonna be really clear about what's working. We're not gonna back down or be afraid to examine what isn't working, and we're gonna share what those results are. And so there's kind of this continuous improvement mindset that kind of gets developed as a result of that. So those are some of the reset things that we've put in place for the company. And, you know, this last year has Caused us to be in a really good spot because both that level of intensity and that level of accountability to one another has caused us to execute really well. Right.