ZenPayroll (YC W12) Raises $60M From Group Led by Google Investment Arm(nytimes.com)
nytimes.com
ZenPayroll (YC W12) Raises $60M From Group Led by Google Investment Arm
http://www.nytimes.com/2015/04/07/business/dealbook/zenpayroll-start-up-raises-60-million-from-group-led-by-google-investment-arm.html
11 comments
It’s been amazing to see ZenPayroll grow over the last few years. We switched to ZenPayroll from Wellsfargo. It was night and day. Wellsfargo made every step of the process difficult, from on-boarding new employees, to sending me paperwork, to updating salaries. When I use ZenPayroll, it feels like they went through every customer interaction point and thought through how to make it a delightful experience. I heard that ZenPayroll have a net promoter score of >80, which is incredible. For context, I just google Apple’s NPS and it’s 66 (http://customergauge.com/news/2014-net-promoter-benchmarks/).
How well does ZenPayoll handle employee portal stuff? Like 401k contribution self service?
We have a dedicated employee dashboard where employees can login do things like change bank account information, federal and state withholding , and even donate a part of their paystub to any registered 501(c).
We consider the employe experience to be just as important as the payroll administrators experience.
We consider the employe experience to be just as important as the payroll administrators experience.
> and even donate a part of their paystub to any registered 501(c).
Wow. Impressive!
Wow. Impressive!
Switched to ZenPayroll from Intuit Payroll and couldn't be happier. ZenPayroll is a great product starting from the onboarding experience, to running weekly payroll, to their customer support, even the automated transactional emails they send out. Intuit on the other hand was so terrible, it actually cost us money because it buried some critical action items (local tax filing forms) under some obscure setting
My understanding is that a big source of ADP's profits is their ability to make money on the float. [0] Does ZenPayroll do this too? I suspect it doesn't make sense at the current scale, but could be part of their valuation. Payroll is a great recurring revenue stream. Even with these new entrants, most firms keep the same provider for many years. (I don't pay great attention, but I don't recall ever having a paycheck come from someplace new within a given company)
[0] http://ww2.cfo.com/people/2013/04/how-adp-turns-payroll-into...
[0] http://ww2.cfo.com/people/2013/04/how-adp-turns-payroll-into...
We don't do this, as we're currently just 100% focused on building the best product possible for our customers.
Interesting - I've always assumed ZP does do this, because the lag between when you debit our account and when the employee's account gets credited seems to be pretty long (3-4 business days at least).
Is this just an artifact of ACH? What is it that causes it to take so long?
Is this just an artifact of ACH? What is it that causes it to take so long?
They did a great write-up on ACH actually: http://engineering.zenpayroll.com/how-ach-works-a-developer-...
Yup! Part 3 of the post explains why there is the lag:
http://engineering.zenpayroll.com/how-ach-works-a-developer-...
By the way, I hope no one minds if I insert a plug here: We're working on some very interesting ways to cut down this time in our engineering team and we're hiring on all fronts. Shoot me an email directly (in my HN profile) if you're interested in learning more!
http://engineering.zenpayroll.com/how-ach-works-a-developer-...
By the way, I hope no one minds if I insert a plug here: We're working on some very interesting ways to cut down this time in our engineering team and we're hiring on all fronts. Shoot me an email directly (in my HN profile) if you're interested in learning more!
Do you have integrated timecards? ADP does that, as well as payroll for us. (I looked at your site and didn't see anything.)
We have a number of great 3rd party time tracking software tools thats integrate well with ZenPayroll via our api. For example ,TSheets, WageBase, Nimble Schedule.
https://zenpayroll.com/integrations
https://zenpayroll.com/integrations
What is an integrated timecard?
People are paid from what's on their timecard (aka timesheet) and job cost and billing is generated from the single source.
Ahh - got it!
Thanks for the response. My 2 cents... This will be a great bonus for you once you've grown. In the meantime, I think you're in an area ripe for disruption. ADP and Paychex are old companies with old technologies, processes and mindsets. It's like you're competing with GM or IBM. Good EPS management, but not the future. You'll grow fast, and what's the worst thing that happens? One of them buys you so the other won't.
Leaving a payroll provider can be difficult (especially if you have 401k, and other benefits tied into it). That said - it's worth switching to Zenpayroll. In my experience with Paychex and now Zenpayroll, Zenpayroll is a clear favorite.
Congrats guys! We've been with Intuit for the last 5 years and recently made the transitioned to ZenPayroll - we haven't looked back. Huge fan of the automated emails along with their outstanding on-boarding/support.
We use ZenPayroll at Clearbit and couldn't be happier! Such a well thought out experience all round.
Here's hoping they'll start selling health and office insurance too so we can drop our other providers.
Here's hoping they'll start selling health and office insurance too so we can drop our other providers.
I read that Google Capital rather than Google Ventures lead the round. Could someone explain to me how these two bodies differ and what the significance would be?
Google Capital and Google Ventures are two different investments arms of Google. Google Ventures focuses a lot more on early stage companies (and makes many investments throughout the year), while Google Capital focus on later, growth stage companies. Google Capital tends to only do a few large investments each year. In ZenPayroll's case, we were honored to have strong interest from both GCap and GV, so they both invested, with GCap leading.
Ah thanks for the insight. I know that GV is a separate entity from Google proper with a chinese wall in place between the corporate mothership and itself. Is this the case with GC as well?
I wonder what percentage of ADP/Paychecks business ZenPayoll has been able to siphon off?
We don't know the exact number ourselves, but I can say that we do get a lot of businesses who are switching from ADP/Paychex.
Here's a quick Twitter search that might be useful for anecdotal data-points: https://twitter.com/search?q=zenpayroll%20paychex&src=typd
The majority of small businesses still do payroll manually, so we get even more switching from doing it themselves.
Here's a quick Twitter search that might be useful for anecdotal data-points: https://twitter.com/search?q=zenpayroll%20paychex&src=typd
The majority of small businesses still do payroll manually, so we get even more switching from doing it themselves.
Yeah I dont doubt it. Using ADP has to be one of the most miserable experiences ever. Not to mention their web page that looks like its from 1982
I'd toss them in a hot second if it was my decision.
ZenPayroll worked great at the previous company ...
I'd toss them in a hot second if it was my decision.
ZenPayroll worked great at the previous company ...
any reason i was denied access to your platform? during the underwriting i expressed interest in operating as a PEO. what is your companies policy for said situation? would like more transparency lest you all be accused of being religious freedomists. happy to provide more information offline.
thanks.
ZenPayroll is not a PEO, so we unfortunately cannot accept any company that want to operate under the PEO model.
As I'm sure you know, a PEO technically hires a client company's employees, thus becoming their employer of record for tax purposes. Our model (like most payroll companies) requires companies to hire their employees under their own EIN for maximum flexibility and cost efficiency.
As I'm sure you know, a PEO technically hires a client company's employees, thus becoming their employer of record for tax purposes. Our model (like most payroll companies) requires companies to hire their employees under their own EIN for maximum flexibility and cost efficiency.
Thanks for your response Ed. I appreciate that you're willing to respond here.
It is my company that wanted to operate as a PEO i.e. we would be the employer of record for the employees of our client companies. We then hoped to use ZenPayroll to process our payroll. I was told that you all like to work with companies that have 10 employees or fewer, which is fine, but it doesn't sound like if companies grow past 10 employees you kick them off your platform.
I think you all are a great company, and your colleagues have been both friendly and responsive in our dealings so my questioning isn't meant to detract from that.
Thanks.
It is my company that wanted to operate as a PEO i.e. we would be the employer of record for the employees of our client companies. We then hoped to use ZenPayroll to process our payroll. I was told that you all like to work with companies that have 10 employees or fewer, which is fine, but it doesn't sound like if companies grow past 10 employees you kick them off your platform.
I think you all are a great company, and your colleagues have been both friendly and responsive in our dealings so my questioning isn't meant to detract from that.
Thanks.
If you'd like to use the PEO structure checkout Justworks, we are a PEO and offer a lot of cool HRIS stuff besides just payroll and benefits administration.
http://www.justworks.com
http://www.justworks.com
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I am curious to understand what it takes to move from SMBs to move upmarket. Any examples of companies that have made the successful transition without alienating its core SMB customers?
zenpayroll is awesome. no more pain
Love getting paid using ZenPayroll!
Next week: Google launches its own payroll service