>What R&D does a payroll provider do? (Genuine question)
Halfway down the Techcrunch article, Joshua Reeves mentions what "R&D" in NYC intends to work on:
- While Gusto’s central product is payroll, Reeves sees two other product arcs he intends to develop more in the coming years as the company scales. One arc, which we talked about last year, is fintech features like Flexible Pay, a product that allows employees to receive their unpaid wages in advance, with the goal of reducing reliance on usurious payday lenders. The other product arc is health care and helping SMBs offer insurance benefits to their employees. “We want to be a force for universal health care,” Reeves said.
- As Gusto explores additional products built around its payroll service, it has sought to expand its engineering R&D team. The company announced recently that it will open an R&D office in New York City in September, which it hopes will be able to both execute on these two products as well as others not yet planned.
So, another way to state "R&D" is "new product development". Gusto wants to offer more SaaS capability than just plain payroll processing such as short-term loans, health insurance management, and other yet-to-be-disclosed new products. Presumably, in Gusto's slide deck to raise the $200 million, they convinced new investors that the money would be used to build new products.
This is a REALLY good question and something that's hard to appreciate until you actually to build a payroll system. I think a common misnomer is that if you're not doing ML/AI/AR/blockchain/[insert latest technology here], you're not doing R&D.
The domain of Payroll turns out to be an incredible complex business domain. I think Ron Jeffries says it best in his post: http://wiki.c2.com/?WhyIsPayrollHard
The software design of such a complex business domain at scale turns out to be an incredibly hard engineering challenge, and something that is often overlooked when we think about big engineering challenges.
A little known fact is XP and Agile were developed by Kent Beck while working on a Payroll system for Chrysler (In fact, Kent now works at Gusto to help us with our payroll system).
I'm CTO of Flip (https://flip.lease), we handle a lot of rent payments each month.
I get the same question a lot. Most people could not imagine the amount of complexity that exists underneath the seemingly simple guise of paying rent. Just wanted to say I can sympathize and I respect what you've been able to do, specifically from the technical perspective. (We use Gusto and it's been absolutely fantastic)
Unrelated, my whole team was very impressed by the attention to detail in your rebrand. It's so difficult to transition the landing pages and internal product so seamlessly, again coming from the technical perspective. I imagine you're running a tight ship over there, and it shows.
