In this inaugural episode Matt Vaadi, founder of Guru Payroll and HR (formerly ERG Payroll and HR), outlines the purpose of the series—to document the challenges, successes, and behind‑the‑scenes decisions as the company scales. He describes the firm’s evolution from a traditional payroll outsourcing service for small businesses (10‑49 employees) to a hybrid SaaS and services model, emphasizing recent hiring of four salespeople and a focus on automation and sustainable growth. A major strategic move highlighted is the development of proprietary software over the past five years, starting with paperless onboarding, then time‑keeping and PTO management, and now a newly launched payroll module. Vaadi explains why most payroll firms rely on white‑label platforms and why Guru Payroll chose to build its own to better serve its niche market. The episode details the planned launch of the payroll app, concerns about production rollout, testing procedures, and the reality of encountering bugs that forced a rollback. Vaadi reflects on the stress of post‑launch fixes, the learning curve of managing software development as a non‑technical founder, and the value of having product control despite the headaches. He teases future episodes covering the rollout outcomes, a failed acquisition, strategic partnerships, and the “1‑1‑1” model, inviting viewers to subscribe for ongoing insights into growing a payroll business.
Chapters
Really what we're trying to do here is document some of the challenges that we're having, document some of the things that are working well, and just give somebody a peek behind the scenes as we're going on this journey. So my name is Matt Vady. I'm the founder of Guru Payroll and HR, which we changed names about, I guess, 2 and a half years ago from ERG Payroll and HR we started as about 9 years ago. I'm sitting here right now in the captain Jason Gullett's desk. He's out on paternity leave, just had his first child about a week and a half ago, so really exciting time. And this is kind of where we're at with this whole thing, with recording this video for you guys to watch and, and kind of documenting this step of our journey is figuring out where the best lighting is in our building and where we can accommodate these types of conversations. But really what we're trying to do here is document some of the challenges that we're having, document some of the things that are working well, and just give somebody a peek behind the scenes as we're going on this journey. And right now some of the things that we're really focused on are automation and long-term sustainability. So we've recently just put, as an example, 4 people in sales positions, going from 0 to 4 over the last 6 months, which means that obviously over the next few months we're going to start we see a big uptick in new customers versus our last couple years here. And so that's going to put strain on our infrastructure as a business, that's going to put strain on our internal staff. So we're trying to get out in front of that. So when we look at current challenges on the plate today, it's a whole lot of automation, it's a whole lot of systems, it's a whole lot of focus on making sure that we have a great hiring plan that puts us in front of those needs before we have them so that we're not putting too much on our people Obviously, as an HR-focused company, we are trying our best to make sure that we're not, you know, overworking people, putting too much on their plate, and trying to create a great culture, which is not something that's easy to do in this industry because it can be very stressful work. So what we do is we do payroll and HR outsourcing and processing for small businesses, predominantly employers with 10 to 49 employees. And mostly white-collar stuff. So we're a little bit different than a lot of folks in this space in that usually the play is if you're going to stay small business, you stay small business, but you kind of just do payroll or you do a little bit of HR. We've decided that we are going to stay small business and we are going to stick to a specific set of industries. But then the biggest variance that we've done is that we started developing our own software about 5 years ago. So it started with just some simple HR functionality, paperless employee onboarding, document storage and warehousing for employee information. We then built in timekeeping and PTO management, personal time off management for employees, and we're launching our payroll module right now. And so we've put a lot of money, a lot of time, a lot of energy, made a pretty big bet here that our software is not only going to be able to serve the needs of our small business clients, but also that it's something that can help us to have control over our future. So if you're watching this and you're somebody that's not familiar with the industry, I'd guess 99.5% of payroll companies use a white label payroll software. So only your real big companies, your ADP, your Paychex, your Paycom, your Paylocity, a lot of the public companies are the ones who build their own platforms. The rest of us tend to use a handful of these. You know, there's probably 10 in total that really dominate the market. That are white label systems that we can slap our logo up in the corner and then serve our clients on top of that software and then add a bunch of small businesses all over the place. We decided that we want to build our own. Why? It's a good question. You know, some days I wonder that same thing. It's a whole different, whole different thing to become a software development company and a services company, which is, you know, those two things go hand in hand. We're a SaaS business, right? Software as a Service. So those two things go hand in hand. So we're finally going to go live with our payroll app after 9 months of development on Tuesday at 9 a.m. Is that what you're telling me, Mr. Murdaugh?
10 a.m. IST.
IST. Why on earth would we be talking in these foreign terms, Brian?
Well, because I did not have time between that meeting and this meeting to go to my time zone application and figure out what that means. It's going to be like— it's 12:30 AM. Yeah, I was going to say it's around midnight.
Yeah. What concerns do we have about the initial push to production?
So yeah, so primary concern is, is that new— that existing customers on legacy payroll system might have some sort of hiccups with the new front end just being available. It should not affect anything like from a timekeeping perspective or, you know, assessments, any of the doc— all the existing stuff should live fine because it hasn't been routed in this process. Like, we haven't ripped out anything.
So within that early hours, then, are we having someone that's like testing out all the functionality during that time that it's gone live at that point?
Yeah, so as soon as, as soon as they take it out of maintenance mode, um, the developer team is going to start doing um, the— those regression smoke tests in prod, then, um, we will also do that at earliest opportunity. Um, and, um, I would recommend that you guys do the same. Like, I want to make sure that we've got a lot of test coverage here.
Um, so What's the chances, uh, in your experience that this goes off without a hitch?
Like percentage-wise, that it goes off without a hitch, or that it goes out without a catastrophic hitch? I have two numbers here, right? Without any hitch, I mean, the, the chances are pretty low. We're like, yeah, you're in 5 to 15% that there are no hitches that happen. The chances that something catastrophic enough to roll back happens are probably similar. It's like, they're probably opposites of each other. Like the number of times that I have actually witnessed a major production rollback because something was so catastrophic that it couldn't be, on something big, on something that's been worked on for a long time, is very— I don't even— once or twice maybe I've seen it.
So we went ahead and launched the payroll product, rolled it out into our app, our HR and timekeeping application, and we had a lot of issues. We had to, for the first time ever, roll back a release of the product. And so it was definitely stressful time came into a whole bunch of calls and emails from clients who had logged in and things were out of place, or, you know, things were moved or broken. I often joke, man, software development's like a game of whack-a-mole. Um, or like, think about like putting your hand over holes in a leaky boat. It's like as soon as you, you touch one thing, something else breaks. And so, uh, I'm not super surprised that it happened just from historical things. No matter how many precautions you take at any time, you— how much no matter how much testing, you never know what's going to happen until you push something to production. And we were able to get it fixed, get it back to live, and are adding clients to the payroll product. It was definitely a stressful period of time around here while we got everything cleaned up and definitely felt terrible anytime you're, you're affecting something that's going to impact the user experience. So we're up and rolling now, excited, but it's definitely been a trying couple weeks. Once you start opening that door, I'm not a technical founder, I've I've never written a line of code in my life outside of HTML and, you know, hello world website like we all did in, in college. But, you know, we knew that this was going to create more value for the business and more value for our clients because the thing that was wrong with all the white label softwares that we found is that, you know, if we say we want to be 10 to 49 employees is our sweet spot, predominantly in certain states and in certain industries, these other systems are built to accommodate employers up to 10,000 employees in every state for, you every size, every industry, so they have all the bells and whistles, and they become really cumbersome for the small businesses. So that was the biggest driver, was just we wanted something that looked and felt easy to use and was just there to meet our clients at their point of need and not do all the stuff that they really didn't have a ton of need for. So that was the really the biggest driver behind developing the software, was just having some control over the product. And boy, did we get the control, right? And that comes with all the headaches that comes with, you know, development calls I just had this morning. This feature is behind, this one's buggy, this one's not working the way we had hoped it did. And you know, it's like Mike Tyson always said, or Mike Tyson's famous quote of, "Everybody's got a plan until they get punched in the face." And we get punched in the face pretty regularly on the development side. So that's a big challenge for us, but at the same time, it's also a huge opportunity, and we're creating something that I think is really special, and that's only getting better. Well, stay tuned because over the next few episodes, we're going to pick up where we left off on that software development conversation and talk about how that launch went with our new payroll app. We're also going to talk about an acquisition deal gone wrong. We're going to get a peek behind the scenes into how we develop and some of the conversations related to our strategic partnerships and how we follow the 1 1 11 model and a ton more. So I'm excited for you to come along for this journey. I really hope that it's helpful to you and you growing your business. Make sure you hit that like and subscribe button. I know it's corny, but it really encourages us and makes sure that we can develop more of this content. If it's providing value to you, it's the least you could do. Thanks so much for tuning in. We appreciate you.
