In Silicon Valley, it is becoming more evident that “your sins will find you out.”
After Ellen Pao’s case, Uber’s multiple charges and accusations, and a host of other venture capital firms and tech companies being ousted, one month after reports of lewd behavior and wrongful termination against web-based lending startup Social Finance became visible, the organization has declared that its hard-charging CEO Michael Cagney will be stepping down at the end of the year. The organization declared it has started a search for Cagney’s successor, though he will stay in the position officially until a substitution is found.
Cagney, who will also step down from the organization’s Board of Directors, where he filled in as executive chairman, becomes the most recent CEO in Silicon Valley to be brought down around claims of sexual misconduct among his organization’s staff.
“I believe now is the right time for SoFi to start the search for a new leader,” Cagney said in a statement. “I could not be more proud of the company we’ve built together, and I look forward to passing the baton to a new CEO who can continue SoFi’s mission of revolutionizing personal finance, helping our members to get ahead and find financial success.”
SoFi is considered a powerhouse in financial technology circles, making its name refinancing student loans. The startup, which has raised about $2 billion since its initiation in 2011, has since proceeded to a wide range of loaning services. SoFi subsidized $3.1 billion in advances, creating over $134 million in income and $61.6 million in balanced EBITDA in the second quarter alone. The organization claims it has issued over $20 billion in advances since its dispatch.
The organization’s directorate named Tom Hutton, an investor in the organization and the managing director of financial technology firm XL Innovate, as the organization’s new official administrator. “With Mike (Cagney) at the helm, SoFi has become a major, innovative player in consumer finance. We are grateful for all he’s done to help build this remarkable company,” Hutton said. “We’re confident that we can find and hire a great CEO to continue that innovation and drive excellent financial performance.”
SoFi also said that Steven Freiberg, their acting CFO and a member of the board, will handle extra obligations as the organization’s Vice Chairman. Freiberg had filled in as the CEO of E*Trade and co-director and CEO of Citigroup’s Global Consumer Group in previous tenures.