Inside Gusto: From 2011 to Now Into a $746 million business
Startup Type:
Headquarter: San Francisco, USA
Current Status: Active (private; serves 200k+ businesses)
Founders: Joshua Reeves, Edward Kim, Tomer London
Founded Year: 2011
Investors: General Catalyst, Kleiner Perkins, DST Global
Funding Raised: $746 million
What Is the business model of Gusto?
Cloud-based HR and payroll platform for small businesses, offering payroll processing, benefits administration, and HR tools on a subscription basis
How Gusto got started?
Launched as ZenPayroll in 2012 after the founders realized small businesses found payroll overly complex, they focused on a simple, paperless payroll solution and later rebranded to Gusto as they expanded into benefits and HR services
what growth strategy has Gusto followed?
Gained traction by targeting startups and small companies with an intuitive, modern software alternative to stodgy incumbents, relied on positive referrals from business owners and accountants, and expanded offerings to become an all-in-one people platform to increase revenue per client
what are the top products/features of Gusto
Gusto Payroll, Gusto Benefits, Gusto HR, Gusto Wallet app
what was the biggest challenge faced by Gusto?
Highly competitive SMB market with legacy providers (ADP, Paychex) and many startups, requiring continuous addition of new features (benefits, 401k, compliance) while maintaining ease-of-use and customer support quality