With Revenue Flat, Zenefits Looks to Restart After Crisis

A lot has happened since Zenefits told investors last year that its already lofty projection for annual recurring revenue would more than triple by the end of 2016. The HR software maker saw its founding chief executive officer leave under pressure from the board, paid about $1 million in fines to state regulators for selling insurance without the proper licenses and renegotiated a lower valuation with investors to avoid a potential lawsuit.

The company's optimistic projection of $450 million for 2016 hasn't come to fruition. Instead, Zenefits' annual recurring revenue is about the same as it was last year, hovering above $60 million, according to people familiar with the matter, who asked not to be identified because the financials are private. Growth started slowing last year when CEO Parker Conrad was still in charge and continued to slide throughout the corporate crises and management transition.