(Reuters) – Social Finance Inc said on Monday its co-founder Mike Cagney would step down as chief executive and chairman, less than two weeks after the online lender said it was investigating claims of sexual harassment that emerged in a lawsuit.
Cagney, a former Wells Fargo trader and hedge fund manager who co-founded the company in 2011 with a mission to take on the banks in the student loan market, said the focus has now shifted more toward litigation and him personally.
“The combination of HR-related litigation and negative press have become a distraction from the company’s core mission,” Cagney said in the note to employees on Monday.
The company, known as SoFi, has begun a search for a new CEO, and Cagney will remain in the role until a replacement is found.
SoFi said Tom Hutton, an early investor in the company, would immediately replace Cagney as executive chairman.
Earlier this month, the San Francisco-based company launched an investigation into claims that current and former employees were sexually harassed at work, making it the latest technology startup to deal with workplace issues.
Ride-hailing company Uber [UBER.UL], also based in San Francisco, is struggling to overcome allegations of sexual harassment and executive misconduct. Venture capitalists have also faced criticism over their treatment of female entrepreneurs.
SoFi was valued at more than $4 billion at its most recent funding round earlier this year, making it the second-highest, venture-backed financial technology startup in the United States, with backers including investment heavyweights such as Softbank Group Corp (9984.T) and Silver Lake Partners.
Reporting by Abinaya Vijayaraghavan in Bengaluru; Editing by Amrutha Gayathri