“Today, we are also launching two incredible new services: health benefits and workers’ comp,” cofounders Edward Kim, Tomer London, and Josh Reeves wrote. “These services are fully integrated with payroll, which removes a tremendous amount of unnecessary manual effort for business owners. Most importantly, both employers and employees can now onboard and manage all forms of compensation in one modern product.”
That’s a big change for the startup, which is backed by Google Capital and Kleiner Perkins Caufield & Byers, among others.
There’s one company that comes to mind when you think about this new direction: Zenefits. Besides the obvious use of “zen” in the names of these two San Francisco startups (until now), both of them offer have offered payroll. But Zenefits, which also offers insurance, has taken off, having raised $500 million earlier this year.
ZenPayroll has succeeded in rolling out its services in all of the U.S., but today’s changes will allow it to more closely compete with Zenefits, which has proven that there is a market around benefits, and one a startup might do well to chase.
ZenPayroll — oops, Gusto — announced a $60 million funding round in April.