The global future of remote work, according to three HR startup leaders | TechCrunch Disrupt 2024

The Current and Future State of Work

• The current environment of work is being discussed, with a focus on the future of work and trends to look out for, including the decision by Amazon to have employees return to the office five days a week (43s).
• This decision is seen as an outlier, with data showing that distributed work is growing significantly year by year, according to census polling and other data (1m38s).
• The decision by Amazon is viewed as a cultural choice, with the company deciding how to run its business, rather than a reflection of a broader trend (2m7s).
• A survey of over 300,000 small and medium-sized businesses in the US found that 20% are moving towards full remote work, 50% are adopting a hybrid model, and 30% are moving back to an office setup (2m37s).
• The power dynamic in the job market is currently in favor of employees, with employees demanding better tools and employers trying to run their businesses in smarter ways (3m6s).
• Employers have a wide variety of needs, and the best approach to work environment will depend on the specific industry and business (3m22s).
• The development of stronger workforce management platforms is allowing employers to adjust to changing environments and requirements (3m53s).
• The COVID-19 pandemic is still having an impact on the work environment, but 2024 may be the year that adjustments are finalized and a new normal is established (3m42s).
• The future of remote work is expected to be more advanced, with better tools for employers to adapt to challenges and allow workers to work in a more distributed way, using customized tools that meet their needs (4m5s).
• Having a distributed or hybrid workforce has become more normalized, and companies are now more open to hiring international workers, with over 75% of companies with at least one international employee planning to continue hiring internationally (4m32s).

The Rise of Distributed Work and International Hiring

• The pandemic has accelerated the trend of hiring in multiple locations, including international hiring, and this trend is expected to continue (6m7s).
• There has been a significant increase in entrepreneurship, with over 550,000 new employers starting in the past year, a 20-year high, and this trend is expected to continue with the help of tools and products that make it easier for people to start businesses (6m33s).
• The majority of employers in the US are small companies, with over 4 million having less than five employees, and these companies are now gaining access to better tools and technology (7m21s).
• The growth of remote work and distributed teams is not limited to big tech companies, but also includes millions of smaller companies that are now able to access great tools and technology (7m28s).
• Many companies focus on mid-market and enterprise segments, but there's a large segment that needs to be served, and companies like Shopify and Square are also focusing on this segment (7m37s).

Challenges and Opportunities for Remote Workers

• The idea that you can work from anywhere and have the same benefits and package as those working at headquarters is not entirely true, as there are still differences between working at headquarters and working in another city or country (7m57s).
• Historically, contractors were left with the short end of the stick in terms of pay, equity, and benefits, but the growth of the distributed workforce has led to a redistribution of wealth and improvements in these areas (8m29s).
• Local governments and companies are working to improve the situation, and entrepreneurs are also playing a role in creating change (9m1s).
• Granting equity to remote workers in different countries can be challenging, but some companies are working to simplify the process, such as the announcement of "remote Equity" which allows companies to issue, manage, and handle equity-related tasks easily across the world (9m24s).
• Countries have different laws and regulations, which can lead to tax mishaps and other issues, but companies are working to simplify the process and bring the future of work to today (9m53s).

Workforce Management and Payroll Solutions

• Payroll is a key aspect of workforce management software, and it can be a pain point for entrepreneurs, but it can also be a huge opportunity for entrepreneurs who want to serve businesses in specific ways (10m32s).
• The future of work allows for specialization in different industries, and companies are creating workforce management tools that cater to specific industries, such as childcare facilities (11m2s).
• Companies are working to simplify payroll and other workforce management tasks, such as condensing hours of work into just a few clicks, allowing entrepreneurs to reallocate their time and focus on their business (11m21s).

Embedded Payroll Solutions and Partnerships

• The future of work involves giving time back to businesses and serving industries in specific ways, empowering partners to solve unique problems across industries, with an embedded strategy being a key point in the world of HR startups (11m33s).
• At Check, embedded clients are the primary focus, with the goal of helping businesses become great payroll providers, and the company provides training and support to help platforms launch their payroll business (12m9s).
• Embedded is Check's only focus, and the company is more than just an API, aiming to help platforms become great payroll providers (12m28s).
• Gusto also has embedded products, and payroll is considered exciting due to its critical role in people's lives and its ability to show gratitude and appreciation to employees (12m48s).
• Gusto processes over half a trillion dollars of payroll and abstracts complexity for business owners, making it a key benefit for customers (13m36s).
• Gusto Embedded was launched three years ago, allowing other platforms to build their own payroll products natively using Gusto's infrastructure and expertise (13m52s).
• Gusto Embedded has had big partners sign on, such as Chase, and is considered a new market with opportunities for competition (14m12s).

Global Payroll and Compliance Challenges

• At Remote, the goal is to build things that seem like a given but require a lot of work, such as instant payment and global payroll capabilities, and the company aims to leverage its expertise to make payroll easier and more efficient (14m26s).
• Remote takes a global approach to payroll, running payroll in multiple countries and providing a better experience for customers (14m52s).
• The global remote work market is highly competitive, but its massive size presents opportunities to make a significant impact on people's lives by making payroll management easier and more efficient (15m3s).
• Managing money at scale comes with high stakes, including the risk of mistakes when running payroll, which can have serious consequences for workers and employers (15m34s).
• One of the primary concerns is ensuring that workers on the platform receive their pay on time, and this requires careful attention to regulations and tax payments (15m48s).
• The complexity of regulations and tax payments can be overwhelming, especially for industries like agriculture, which has unique rules and requirements, such as those related to migrant workers and H2A regulations (16m11s).
• To build trust with employers, it's essential to provide a tailored solution that meets their specific needs, rather than a standalone payroll product (16m42s).
• Mistakes can happen in payroll management, but they can also be opportunities to build trust with clients by addressing the issue promptly and transparently (16m59s).
• Effective communication with tax agencies is crucial in resolving mistakes and ensuring a seamless experience for employers (17m27s).
• The relationship with tax agencies is critical, and being able to translate complex regulations and advocate for employers can make a significant difference (17m47s).

Gusto's Impact and Competition in the Market

• The trend of "compliance inflation," with over 15,000 new compliance rules created every year, can be a significant challenge for businesses, and navigating these regulations requires hard work and effort (18m9s).
• When the company Gusto started, around 35% of companies in the US were getting fined every year for incorrectly doing their payroll taxes, but now Gusto serves over 5% of the companies in the US, making a dent in solving customer pain points (18m33s).
• Every relationship with counties, towns, and zip codes matters, as there are many agencies and government departments that can make it harder for entrepreneurs to be successful, which Gusto is focused on productizing and helping customers with (18m51s).
• The current inflation creates a barrier to entry, making it harder for new companies to start, but it's still possible to create a Gusto competitor from zero in a big market with lots of competitors (19m15s).
• Gusto has made progress, with 2700 employees serving over 300,000 businesses, and welcomes competition, focusing on being the best possible product (19m32s).

Embedded Payroll and its Benefits

• Embedded payroll allows businesses to build great products that serve payroll alongside workforce management, leveraging existing businesses to make it simpler (19m56s).
• Embedded solutions like Gusto's can unlock new possibilities, enabling new companies to be created that solve specific problems for certain types of businesses (20m15s).
• An example of this is a partner company, Dpos, which solved a specific problem for coffee shops with hourly workers, tip calculation, and scheduling (20m31s).
• Remote, an HR startup, also sees new companies being created that wouldn't exist before, thanks to the wave of HR startups and products like Remote (21m0s).

The Future of Remote Work and the Role of AI

• The success of a few companies in a market can create a sense of excitement, leading to more investors funding companies in the space, but it's a huge market that requires playing well and understanding the competition (21m21s).
• The future of remote work is promising, with AI making everything possible, but tax and compliance regulations pose a challenge, especially outside the US, where each country has significantly different regulations for running payroll (21m55s).
• Partnerships are crucial in navigating these complexities, as seen in Gusto's partnership with Remote, allowing them to leverage each other's expertise and enhance the lives of their customers (22m32s).

Prioritizing Impact and Intensity in Product Development

• When prioritizing the roadmap, the focus is on two key factors: impact and intensity, with the goal of building a great product that provides an excellent experience for customers, as their livelihoods depend on it (22m55s).
• The impact of a company's work matters, and entrepreneurs take this responsibility seriously, striving to make their customers' lives better, which is a privilege and a source of joy (24m12s).
• When building a company, the approach to features can be to build, buy, or integrate with another company, and the choice depends on the specific needs of the business (24m43s).
• Embedding a product, rather than just integrating it, allows for customization and ownership, providing a more comprehensive solution for employers, as seen in Check's approach to payroll (24m57s).

Simplifying Payroll for Employers

• When setting up payroll, employers may encounter unfamiliar industries, taxes, and exemptions, which can be confusing and scary, highlighting the need for a user-friendly and guided experience (25m39s).
• Embedded solutions are preferred over integrations as they provide a more tailored and guided experience for employers, helping them make the right choices (25m53s).
• The future of payroll and HR solutions lies in embedded technology, which offers a more personalized and streamlined experience for employers (26m6s).
• To ensure that payroll solutions are not too complicated for customers, it's essential to start from first principles and design products that are easy to use, requiring no training or expertise in tax compliance (26m37s).
• Gusto's approach is to create products that are simple, intuitive, and require minimal setup, allowing small business owners to focus on their core activities rather than navigating government documents and forums (26m51s).
• The company's mindset is centered around providing software that gives users superpowers, making their lives easier, and eliminating the need for extensive training or reading manuals (27m27s).

Gusto Embedded Payroll and its Advantages

• Gusto Embedded Payroll is a new product that enables small business platforms to launch their own payroll products quickly and easily, leveraging Gusto's expertise and experience in payroll and HR (27m50s).
• Gusto has considered integrating with other platforms, such as Check, but believes its own solution is more comprehensive and better suited to meet the needs of small businesses (28m9s).
• Gusto's partners choose its embedded payroll solution due to its extensive experience, covering all edge cases and complexities of local, state, and federal filings, and documents (28m29s).
• Gusto has partnered with Remote to offer international employer of record hiring, demonstrating its ability to collaborate with other companies to provide a more comprehensive solution (28m52s).

Collaboration and Competition in the Payroll Ecosystem

• The discussion highlights the importance of creating an ecosystem where companies can both compete and collaborate, with the primary goal of making customers' lives easier and better. (28m57s)
• One leader from Gusto expresses a desire to enable entrepreneurship through their work, noting that while payroll is a part of this, they are also focusing on simplifying the complex healthcare industry to provide peace of mind to people. (29m26s)
• Another participant is drawn to complex, compliance-centric industries, emphasizing the potential to simplify them significantly if solved correctly. (29m56s)
• Lindsay Ma expresses an interest in the legal industry, appreciating the opportunity to delve into legislation and the evolving nature of compliance, and sees being part of this change as powerful. (30m13s)