ServiceNow Inc. has appointed former eBay Inc. and Bain & Co. Chief Executive John Donahoe to be CEO.

The company announced the change late on Monday, after current CEO Frank Slootman decided a transition of leadership was in order. Donahoe, who is also the current chairman of PayPal Holdings Inc. and sits on the boards of Intel Corp. and Nike Inc., will take over the reins at ServiceNow during a critical phase as the company expands into new areas such as operations management and human resources.

Slootman, who will remain on board as the company’s chairman, told CNBC the move was motivated by Donahoe’s availability, rather than any business or time imperatives. He said he recognized the value the former eBay CEO could bring to ServiceNow, and wanted to “make room” for him by vacating the CEO’s chair.

Slootman’s explanation seems reasonable considering his performance throughout his six-year tenure at the helm of ServiceNow. During that time, the company’s share price has almost quadrupled, with annual revenues increasing from $243 million to $1.39 billion. Despite that growth, Slootman has also overseen mounting losses, with the company’s bottom line $450 million in the red at the end of its fiscal year 2016. However, the company’s rising share price suggests that investors aren’t too concerned about these losses so long as it continues its rapid growth.

One reason for Donahoe’s appointment could be that ServiceNow sees him as the best man to take the company to the next level, said Dave Vellante, industry analyst and co-chief executive of SiliconANGLE Media. He noted that ServiceNow has a strong vision and is trying to become a major player in software, setting itself a target of $4 billion in annual revenues.

“Frank Slootman is a star but has never taken a company to this stratosphere,” Vellante said. “I don’t know Donohoe personally, but he has experience scaling a company at eBay.”

In the aftermath of the news, ServiceNow saw its share price fall by 4.2 percent to $87.91, having dropped as low as $86.94 on Monday. Vellante said that investors might not like the move because Slootman did such an effective job during his term. However, it’s also a sign that the company is “putting success ahead of ego,” Vellante said.

Donahoe said in a statement that he would work towards expanding ServiceNow and its workflow automation tools beyond IT, into other markets where CEOs rather than CIOs make the decisions. “The opportunity will be to expand beyond just IT and the chief information officer into helping partner with the CEO to help them address their greatest needs,” Donahoe said.

Donahoe will assume the CEO’s chair on April 3.

Image: Hubert Burda Media/Flickr.com