Every worker relies on a payroll system to get paid. But despite its importance to our daily life, few people think about what goes on behind the scenes.
Building a payroll system has historically taken millions of dollars in investment, years of development, and the layering of multiple third-party services. Puzzl’s premise is that businesses should be able to build a payroll system easily, by outsourcing payroll complexity to a singular parter.
Our strategy is to provide the entire infrastructure required for our partners
to offer their own payroll systems and products. Unlike legacy solutions, we’ve built our platform from the ground-up to simplify the developer experience.
Our API disentangles the intricacies of compliantly running payroll: gross-to-net calculations, disbursements, reporting & filing, and payments.
While every business needs a system to pay its employees, those employers all have different requirements for their software. A florist, a travel staffing agency, and a franchise will have different priorities in a payroll solution. While building Puzzl we’ve been amazed by the demand for industry-specific payroll products by companies that have historically relied on the one-size-fits-all payroll model forced by industry incumbents.
Companies have been forced to use out-of-the-box payroll service providers and hire an in-house team of payroll experts to manually run the process. We think this is a backwards way of doing business. Puzzl was built to power modern payroll solutions for companies innovating new technology to pay workers in the digital age. Our API platform provides unprecedented control for companies to onboard employers and employees, run payroll, and manage compliance with ease.
Why build payroll?
There are two main categories of companies that would want to build a custom payroll solution. These are the Offerers and the Owners.
The Offerers want a payroll product to sell into the market. This can be an HR SaaS platform looking to complete its product suite, a Time & Attendance company that wants to add horizontal functionality, or even a Vertical SaaS company interested in expanding their product offering.
One good example is Square. Square began by offering merchants a point-of-sale product to accept payments. Square realized it could use its payments platform to offer ancillary financial products to their customers, notably resulting in Square Payroll.
Selling a payroll product can be highly lucrative. In addition to the revenue generation of SaaS product itself, adding employers onto a payroll system can function to:
- Increase stickiness: Businesses rarely change payroll providers, so the expected lifetime of the customer on Partner's platform increases.
- Open new markets: Employers that were only looking for an X product that included payroll are now opening to buying from this partner.
- Wedge into additional financial services: Payroll is the ideal wedge into offering fintech products to an employer like loans and benefits because payroll products give access to super-rich employer, employee, and wage data.
Meanwhile, the Owners want to control the payroll experience for their own employees. The distinction between these two user groups is made when the company building the payroll product is the Employer of Record for the end-employee.
Industry examples would be established enterprises usually with thousands
of employees, staffing companies that employ workers directly, or Professional Employer Organizations (PEO) & Employer of Record (EOR) services that are paid by businesses to provide a full suite of back-office administrative products including payroll. Owner companies similarly have complex payroll operations which they would like to tailor to their use-case and automate.
Now any platform can offer its own branded payroll as an integrated part of
its overall product, without having to devote extensive resources into building, maintaining, and staying compliant.