

ZenPayroll (YC W12) Raises $60M From Group Led by Google Investment Arm - ryanjodonnell
http://www.nytimes.com/2015/04/07/business/dealbook/zenpayroll-start-up-raises-60-million-from-group-led-by-google-investment-arm.html

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guiseppecalzone
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/](http://customergauge.com/news/2014-net-promoter-benchmarks/)).

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toomuchtodo
How well does ZenPayoll handle employee portal stuff? Like 401k contribution
self service?

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edawerd
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.

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toomuchtodo
> and even donate a part of their paystub to any registered 501(c).

Wow. Impressive!

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papercruncher
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

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mathattack
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...](http://ww2.cfo.com/people/2013/04/how-adp-turns-payroll-into-cash/)

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edawerd
We don't do this, as we're currently just 100% focused on building the best
product possible for our customers.

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e40
Do you have integrated timecards? ADP does that, as well as payroll for us. (I
looked at your site and didn't see anything.)

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mathattack
What is an integrated timecard?

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e40
People are paid from what's on their timecard (aka timesheet) and job cost and
billing is generated from the single source.

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mathattack
Ahh - got it!

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Vaismania
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.

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maccman
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.

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hkmurakami
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?

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edawerd
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.

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hkmurakami
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?

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misiti3780
I wonder what percentage of ADP/Paychecks business ZenPayoll has been able to
siphon off?

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edawerd
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](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.

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hisabness
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.

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edawerd
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.

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hisabness
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.

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techtivist
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?

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tarof
zenpayroll is awesome. no more pain

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muhammadusman
Love getting paid using ZenPayroll!

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sgarg26
Next week: Google launches its own payroll service

