The article discusses the story of Bench, an accounting and bookkeeping service that was acquired by Employer.com after it suddenly shut down its operations on December 27. Here’s a summary:
Background: Bench had been growing rapidly and had become one of the leading providers of online bookkeeping services. However, in mid-December, the company suddenly shut down its operations, leaving hundreds of employees without jobs and thousands of customers without access to their accounts.
Acquisition by Employer.com: Just a few days later, on December 30, Employer.com announced that it had acquired Bench for an undisclosed sum. The acquisition was completed quickly over the holiday weekend, which raised concerns about whether due diligence had been properly conducted.
Employer.com’s plans for Bench: After acquiring Bench, Employer.com announced that it would honor customer contracts and fully service their accounts. It also offered job re-employment to a "large number" of former Benchmark staff.
Concerns and uncertainties: Despite the acquisition, there are still concerns about whether Employer.com can provide the same level of quality service as Bench. Some employees who have been rehired are only being offered 30-day contracts, which has raised questions about their job security. Additionally, there is uncertainty about whether Employer.com’s lack of prior accounting experience will impact its ability to manage Benchmark.
Key takeaways:
- The sudden shutdown of Benchmark highlights the challenges faced by fast-growing startups in scaling their operations and managing employee expectations.
- The acquisition of Benchmark by Employer.com raises questions about the speed and thoroughness of due diligence, particularly when it comes to complex acquisitions like this one.
- There are still concerns about whether Employer.com can provide the same level of quality service as Benchmark, given its lack of prior accounting experience.
Overall, the story of Bench’s acquisition serves as a reminder that even successful startups can face challenges in scaling their operations and managing their employees, and that due diligence is crucial when it comes to complex acquisitions.
