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Comment by tzier | Hacker News Reader

I doubt this is a response to ADP; ADP is a horrible product, and Zenefits knew they could make a better solution (like ZenPayroll/Gusto). They've probably been working on this for a year, to be honest, given the requirements for payroll providers and syncing with the IRS/etc.

What's more interesting is that the payroll is free only if the company manages everything else HR related in Zenefits. Talk about lock-in.

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The CEO explicitly says that this is a response to ADP:

> As Conrad tells it, a select group of Zenefits employees holed up in the Courtyard Marriott to start working on a secret project to create a payroll system shortly after paycheck services giant ADP cut the company off earlier this year.

> “We’ve been working on this basically since the day we started getting blocked by ADP,” Conrad told TechCrunch.

http://techcrunch.com/2015/11/16/zenefits-launches-its-own-p...

I would have probably been working on it before that, if I were them, as I don't ever feel comfortable being a sharecropper on someone else's land. But, they've delivered quickly.

I think ADP and Gusto forced their hand. They realized they needed to be in control of this part of their business, and while before they had planned it as an "eventually" thing, it became a material risk that was no longer tolerable. If I were them in the absence of the ADP shut down and Gusto competing head to head I would have wanted to focus every dollar on the core service and scale and kicked Payroll down the road. Makes sense in context they did it now though.

I'm sure they've been working on it for a while. And, it may even be part of the cause of the falling out between ADP and Zenefits, who knows? But, nonetheless, I bet it feels good to launch.

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