Software is one of the greatest business models in the world.
Why? Software has zero/marginal Cost of Goods Sold (COGS).
This means each additional customer has very little, if any, variable costs.
Think about more traditional businesses like a coffee shop or restaurant. Every single cup or plate requires its own set of ingredients, prep and delivery.
With software, you build once and sell forever! Any improvements are amortized across the ENTIRE customer base which makes R&D much more feasible. These characteristics are what drives the multiples software businesses command.
Embedded Fintech takes this to a whole different level.
You combine the power of Zero COGS with the built in captive audience of every customer you launch products with.
Rollfi became an embedded payroll provider to take advantage of this EXACT dynamic. In a world where software development costs are dropping at an incredible rate, distribution is EVERYTHING.
For those who might know, Rollfi started life as a crypto enabled payroll and benefits product that helped companies position themselves as modern employers. I was staring at an offer letter from LULA in 2021 and wanted to get paid in crypto. There was no way to seamlessly and legally do this so we got to work after some encouragement from the team over at OnDeck.
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At the time of launch - our world had dramatically changed. FTX collapsed. Celsius imploded. Retail sentiment toward crypto had done a 180 and layoffs were beginning to happen. Our value proposition + differentiation no longer held weight and we were stuck selling a commodity product.
Trying to push a commodity product drives customer acquisition costs (CAC) through the ROOF. It was a knife fight for every single sale and the contract sizes simply didn’t make the effort worth it. Simply put, our unit economics were wack.
However - in every moment of change there is opportunity. We recognized there is a whole host of companies that are perfectly position to offer payroll + benefits.
Any business that captures key back office workflows with their wedge product can easily expand into payroll and benefits.
It didn't have to be called "Rollfi Payroll" and legacy payroll vendors might have worse customer sentiment than the cable industry!
They are almost guaranteed to have a better relationship with their customer than the incumbent payroll provider.
With every company looking for ways to increase Average Revenue Per User (ARPU) and Net Retention Revenue, the stickiness and predictable subscription revenue embedded payroll unlocks are a god send for vendors looking to solidify their place in the SMB stack.
This revelation changed EVERYTHING for Rollfi. We have already launched several payroll systems for our customers representing 1000s of potential SMBs our partners have won over with wedge products that they adore. Each new deployment unlocked hundreds, if not thousands, of new customers who were already primed to buy payroll and benefits from a trusted partner.
Looking forward to becoming the default embedded payroll and benefits infrastructure partner for anyone even thinking about adding it to their product suite.
About Rollfi
Rollfi provides the fastest way for Banks, Vertical SaaS companies, Accounting Firms, and Fintechs to integrate payroll and benefits into their offerings through our white-label solutions + robust APIs. By leveraging Rollfi’s infrastructure, businesses can unlock new revenue streams, increase customer retention, and access valuable payroll data insights. With rapid deployment and comprehensive coverage, Rollfi transforms your platform into a one-stop-shop for essential services, driving growth and enhancing customer satisfaction.
