At Aspire, we like to hear about startups that capture niches in big industries. One such business is Zenefits, the cloud-based human resource platform. Here is the story of how a small startup caught an entire industry by surprise.
Zenefits helps company leaders purchase human resources products. Its service gives firms access to onboarding, payroll, and benefits. For instance, a business executive can use Zenefits to purchase health insurance for his or her team. Zenefits does not charge the company for its services. Instead, it accepts a broker fee for the transaction.
Co-founders Parker Conrad and Laks Srini focused on addressing the needs of small businesses to build their ventures. As a cancer survivor, Conrad felt that small businesses were not being treated well by benefits providers. With the country’s six million small businesses needing support, he saw a huge opportunity.
Since its launch in 2013, the insurance industry has been feeling the impact of Zenefit’s presence in the market. In Utah, the insurance brokers lobbied the Department of Insurance to ban the service in the state. Ultimately, the decision was overturned. Meanwhile, the firm’s growth has skyrocketed. It is estimated that Zenefits has captured a dominant share of the $100 million sector of the $150 billion health insurance broker market. Our team at Aspire is impressed!
Conrad and Srini know competitors will be aiming for their slices of the pie. As such, they will keep improving their product. At Aspire, we hope Zenefits continues to provide a much-needed service to small businesses. They need all the help they can get!