PEO Software Never Tried to Be the Star. That's Why It Won With SMBs

Kevin Andrews:

The plumbing is mission critical. It's where the trust is built or really lost. And so you gotta have great plumbing. You gotta understand compliance. So if it's done right, it becomes a platform where they can grow, right? And also stay compliant in.

And at the end of the day, what has to be exciting is what software is that that employee experiences, and that has to be reliable and always works. I mean, customers will give up some of the cool gimmicky features, you know, for less headaches.

Steve Smith:

Hey everyone, welcome back to another episode of Work Tech Weekly. I'm Steve Smith, Managing Director of Growth at Rep Cap.

Every HR tech founder wants to talk about how fast AI can move. Almost nobody wants to talk about the industry it's moving into, one where a single wrong number in a payroll file turns into a compliance problem for twenty thousand people. Speed and certainty don't usually travel together, and this business runs on certainty.

Today I'm joined by Kevin Andrews, Board Advisor and Chief AI and Transformation Officer at PrismHR and Vensure Employer Solutions, PEO software companies that handle payroll, benefits, and compliance behind the scenes for small and mid-sized businesses.

Kevin has spent thirty years in HR tech. He founded a company, sold it twice, ran technology for a public company serving thirty million people, and has led product and technology at some of the biggest names in the PEO space.

In this conversation, we talk about where AI genuinely helps HR teams and where vibe coding runs into real trouble. We get into what decades of PEO consolidation means for the software underneath it, and why the old idea that compliance software is boring plumbing is completely wrong.

Kevin also shares what he'd tell himself at the start of his career, and where he thinks employee benefits are headed by 2030.

If you want a clear-eyed read on AI in a high-stakes, highly regulated corner of HR tech, this conversation delivers it.

Let’s get into it.

Kevin, welcome to the podcast.

Kevin Andrews:

Thank you, Steve. Glad to be here.

Steve Smith:

Okay. Looking forward to the conversation today. There's a lot of interesting threads to pull on. You know, you've been around HR tech for about 30 years now. Got the perspective of kind of like seeing the sweep of the market. What's the question you're getting asked most often right now?

Kevin Andrews:

Well, it's obviously around AI, usually work in AI. Kind of safely drive, you know, real outcomes in HR in this space. And you know, a lot of it has to do with the value and trust that matters, you know, most to customers. They're looking to how can they impact their business and obviously do it securely.

You know, that's where a lot of conversations drive is, hey, what is this AI thing and can I trust it? And, you know, the big concern usually is the type of data and transactions that happen in the HR space. Is that data secure, and where can you leverage it to improve that experience from an employee perspective?

Steve Smith:

Do you think that people are asking the right questions? 'Cause it seems like one of the things that keeps coming up in sort of the broader HR tech conversation right now is how disruptable is compliance-driven HR tech. Is that, you know, obviously it's just like you can't vibe code your way to a secure payroll solution. How much of a moat do you think HR tech has, and do you think that's sustainable?

Kevin Andrews:

There's a little bit of moat there when you deal with some of the compliance and actually processing the payroll, right? Complexity around that. Where I think the opportunity is, is, you know, there's a lot of around the edge developing around the edge where you've got great employee experiences and things that can impact businesses basically on an operational perspective.

So whether you're a PEO in our case, or whether you're an HR department and you want to build around the periphery of these products, I think that's where the opportunity is. And, but the moat to the core, what I would consider their, you know, core things around benefits and payroll and time and attendance and some of the core products.

I don't think you'll see a lot of people try to dive in either from a company perspective, unless they're larger, but especially in the mid-market, they're gonna rely on kind of trusted sources and they're looking for things that become more efficient. But I think they will build around it and they'll need access to the API and the data and set up their own MCP servers and so forth to access that.

But yeah, so real opportunity there.

Steve Smith:

Well, let's take a step back and talk a little bit about your career arc, because it's been a fascinating one. You've been a part of three companies, two acquisitions, and an IPO. So, you know, back to kind of the start, you were the co-founder at SmartBen in the early 2000s and ran it for 15 years. What was the original insight and the problem that you were solving that nobody else was at that moment?

Kevin Andrews:

You know, back then it was about benefits enrollment. It was very paper intensive and spreadsheet kind of nightmare for brokers and employees. So that annual enrollment was kind of the worst week of the year for most brokers and most people. And so, you know, I got into the industry trying to solve that problem kind of straight outta college and what we saw is the web was an answer for that before anybody really talked about, you know, SaaS seriously.

And so we tried to see if we could meet employees where they were and give them insights and deeper insights of what they were trying to decide about their benefits. And they really didn't understand how they worked and the cost around them.

So really decision support, not just enrollment and helping people choose really well, you know, and the products that they needed to protect their family, insurance and so forth, and kind of turned it away from just a paper process to more of a click and educational process.

Steve Smith:

Well, you know, and it's interesting 'cause I was working in employee benefit communication back then, and just when you talk about, you know, like everything you just said, that's the reality we kinda live in now. And it's just, you know, some people listening maybe like, well, of course you were.

But it's just like, that was really trailblazing stuff then because enrollment, that whole process was incredibly hateful and there was practically no education going on for employees at that moment.

Kevin Andrews:

Yeah, no, I mean, it was really repetitive too, right? You'd fill out a form to put your name and social and address and kid and dependent information five or six times, whether it was dental or health or medical or life. And so really inefficient. And it was more driven as a process versus an educational experience where employees were saying, hey, what plan should I be in and, you know, do I really need this and can I afford it?

And so we started to build tools around helping 'em see their paycheck and the impact of things that were, you know, what were handed from a tax perspective, where there were some benefits, obviously, with cafeteria plans and how those are structured. So.

Steve Smith:

Well then, so SmartBen ended up getting acquired by Hodges-Mace, and then Hodges-Mace was acquired by Alight. So you went from, you know, a co-founder to a president slash CTO, to then a CTO at a public company that's serving 30 million people. What's that transition like when you're living in real time?

Kevin Andrews:

Yeah, I mean, a lot different, right? I mean, each step kind of changed the question you had to ask yourself. You know, the first part and you start it yourself and I've got, as an entrepreneur and builder, so it's, can we build it? And then that shift into, you know, can we scale it? And then when you get up to dealing with 30 million people, can you govern it and continue to add value to those customers that you're driving?

So you go from owning kind of every decision and influencing thousands of them through that structure and process as we kind of transition through. And then, you know, there's a lot of constraints that go with that too, right? Customer outcomes, you know, still wins over, you know, every conversation.

So you, no matter what the size of the organization is, you've gotta have good outcomes for customers that add value to what you're doing, whether you're a startup, whether you're in the mid-market, or whether you're hitting the Fortune 100, 500.

Steve Smith:

So, you know, when you left Alight for PrismHR in 2022, you went from this massive public company back into a high-growth private one. What made you want to jump back in?

Kevin Andrews:

You know, the chance to kind of shape a platform again from the foundation of not just, you know, optimizing a mature one. So when you look at HR, it really sits at the heart of kind of the PEO ecosystem. And that kinda leverage is rare, of how we distribute, you know, through our partner and channel.

And I kind of think of, but I went from serving kind of the Wall Street type organization to Main Street. You know, the problem, believe it or not, never really changes. It's very similar with those customers. They're still trying to pay employees, deal with compliance, deal with complexity. They want to run the business, and they want those products to help them, you know, serve their employees better and also help them run without being a distraction.

So private companies, you know, the speed plus kind of the real modernization mandate was what was attractive. And that was kind of exactly the work I was looking to do again, and have fun, and something that you could steer quicker and faster. I mean, I had a blast at Alight and we accomplished a lot of things.

But it does move at a different pace. And so it's fun to get back in and be able to do the number of transactions that we have and continue to move a product and have, you know, a meaningful impact from an industry standpoint.

Steve Smith:

Well, you know, and another thing that you've said before is that PEOs are sitting on an ocean of data, but it's incredibly decentralized. And it seems like, you know, we're coming out of a period where there was a lot of conversation about wanting to, you know, be the, you know, the UX layer. A lot of companies were trying to solve for the employee experience by taking that approach.

But it seems like, as we're moving into the AI era, that data is becoming even more valuable, if that was even possible. You know, what's it look like when you can kind of fix that data silo problem, that decentralization problem? What happens and what becomes possible then?

Kevin Andrews:

Yeah, I mean, it really unlocks a lot. You move from being reactive type reporting to predictive decision making, and that's a game changer for a lot of organizations. You can have better benchmarking, you know, smarter pricing, and proactive kind of workforce insights to help 'em run their business.

And that's one of the first things that we did when I came in, is we moved everything into data lake and Snowflake. It's allowed us to basically take that decentralized data and bring it all together. And then another important piece is an IAM, right? The access management piece, where you need one single login across all these disparate systems to pull everything together.

So if you've got that, along with a common UX, along with a data warehouse that you can leverage for kind of predictive decision making and better insights, then you create a platform that drives a lot of value. And so they can see that workforce, they can react to that workforce in a different way than they have in the past.

Steve Smith:

And, you know, you brought up kind of this unified employee experience element a couple of times now, and talking about, you know, how that kind of drew from, you know, the, came as part of the Namely acquisition. What do you think that Prism got out of that is what SMB employees actually want from an HR product?

Kevin Andrews:

Yeah, I mean, it's back to employees want simplicity. They want one place, kind of one experience, that minimalist experience. So that's what we always focus on. And then HR teams want configurability without that complexity, where they've got, you know, the unknown, especially as they ramp up new people and bringing in their organization.

Or they wanna make sure they don't overcomplicate what they need to deliver. Workflows that are flexible to their business, you know, not just workarounds that they've gotta deal with and technology, which a lot of times is the case if things aren't well thought out. And understanding of that domain, Namely kind of reinforced that great UX in HR, you know, it isn't just a nice to have, it's, that's what the product is.

And they did a great job in that white collar market and really understood, you know, how do they deliver a unified UX experience. Was kinda all in one place, one experience that I mentioned, didn't have a lot of, you know, layers of complexity that people could get lost in or had to do workarounds for.

Steve Smith:

Well, you know, when you think about how you're approaching the work at Prism, you know, you're modernizing a legacy platform. You're integrating an acquisition and you're building a new data architecture. So any one of those would challenge most organizations. How do you manage all three at the same time?

Kevin Andrews:

Yeah, I mean, you're always prioritizing what's best for the customer and what's gonna impact the customer. So you've gotta stay away from things that, you know, if it's not integral to those kind of foundational things around customer impact, it's really not an urgency. If it doesn't kind of improve the scale, the experience, the security, or insights, it waits. It's kind of how we look at it, right?

It's gotta hit some of those pillars. So it's one of the things, you can get lost in some rabbit holes if you go down and try to solve everything when you do these acquisitions and you're modernizing. You look for things that are gonna eliminate tech debt, that you can run faster, you can innovate quicker, you can deliver, but it's gotta improve the scale, experience, and security.

Otherwise, you know, it's something that falls lower down the priority list.

Steve Smith:

Well, you know, what's interesting now is like, you know, having, you know, been kind of around the PEO space for, you know, a couple of decades now. If you look back to where, I mean, early on, it seems like a lot of, like, the pure kind of SaaS people in HR tech were almost dismissive of PEOs. They were like, oh, they're not real technology companies.

They're just service businesses. And we're in this environment where it's just like, you see the large HCM players going down market, you see a lot more direct SMB platforms trying to go up market. You see, you know, the explosion of, with remote work, it's become a much more competitive tech space.

How is Prism fitting into that kind of a competitive environment? How are you carving out your niche?

Kevin Andrews:

Yeah, I mean, it's funny, it's been that same strategy for 30 years. You've had all these organizations in HR that, the ones that are smaller wanna go up market and the ones that are up market wanna expand their TAM and go down market. And as they've always seen, it's easier said than done.

Right. With a single platform. Just 'cause you've got some complexities that you have to deal with in upmarket that then overcomplicates the down market and the margins and so forth that you need. Where PEO wins is on service plus expertise. So it's not just software. They're providing a service and expertise so that companies don't have to go in and manage, you know, the compliance and the benefits and the things that a lot of times slow them down in a smaller business where they don't have large teams to be able to do that.

They can go focus on what their core competency are and what their business is. And so that's really the advantage, that service plus expertise. Our role is just to power that differentiation with better tech. We gotta make sure we deliver good tech to them so that it's competitive and it helps, you know, solve the problem of that SMB.

Steve Smith:

Well, you know, it's just, it seems like, you know, SMBs have historically been underserved by the HR tech market. You know, like you said, the companies that start off at the SMB, it seems like they quickly abandon those SMB customers as they start trying to pursue going up market. The larger players try to move down market, but they're not used to. Do you think that maybe SMBs are finally getting their due and that maybe the approach to serving that market is changing, or is it still mostly lip service?

Kevin Andrews:

I mean, I think it's a little both. Yes. I mean, we're seeing a shift toward a lot of these purpose-built SMB solutions, which I think is great for the market. And, but there's still a gap in delivering enterprise-grade outcomes with these enterprise type customers. I mean, there's complexity.

When you have to deliver something in an enterprise, it's one of the problems you have with AI. You get a lot of vibe coding, right? And you get some cool ideas and cool product that can be spun up very quickly. And then usually we see 'em break down when they deal with security and infrastructure and how do you deliver 'em at scale. You get 10 people on it and all of a sudden they have a problem.

So that's the big thing that we see is, you know, there's a ton of opportunity. We're seeing some meaningful outcomes and a shift toward those purpose-built, you know, bespoke type solutions.

But you still gotta have, you know, an enterprise-grade distribution to meet most of those customers' needs at scale.

Steve Smith:

Well, and it's funny 'cause you see, you know, the more things change, the more they stay the same. And I think that there's still this cynical view of PEO software that it's just, it's merely compliance plumbing, you know, it's the boring stuff. But, you know, it just seems like that take is completely, I mean, that it's so shortsighted and it's so wrong.

I mean, what's your POV on this one?

Kevin Andrews:

Yeah, I mean, the plumbing, you're right. The plumbing is mission critical, though. It's where the trust is built or really lost. And so you gotta have great plumbing. You gotta understand compliance. So if it's done right, it becomes a platform where they can grow, right? And also stay compliant in.

And at the end of the day, what has to be exciting is what software is that that employee experiences, and that has to be reliable and always works. I mean, customers will give up some of the cool gimmicky features, you know, for less headaches and issues that cost them, you know, real time with their business and their employees.

Especially if you got a small business where you don't have, you know, people that can really get tied up a day or two dealing with some compliance or issue around payroll or HR or benefits. And so, you know, it may seem boring for some, but those that use every day and depend on it, it's all about the trust, and that plumbing is important and it helps them meet their compliance and stay on their growth.

Steve Smith:

Yeah, it's like compliance. You have to get it right 100% of the time, you know, whether you're talking about payroll or benefits. I remember back in the day, I was talking to a broker and just like, you know what, you go through an open enrollment and, you know, you get 20,000 employees registered for their benefits in less than a month. And it always seems like if you miss one, it is always like a really important VP of something and you never hear the end of it. You

Kevin Andrews:

Oh yeah.

Steve Smith:

Mistake outta 20,000 and that's the only thing you ever hear about. But that, I mean, people don't understand that's the stakes in compliance.

It's not like a lot of other areas of software.

Kevin Andrews:

Yeah, I mean, you look at it's the same thing. You send, you know, files across for eligibility. I mean, you literally send thousands of records across and you get, you know, one error in a name or a salary or a benefit that's off, and you hear about it, right? It's the compliance and the impact it has.

It's usually always, as you mentioned, that VP or somebody that was critical just about to go to the doctor for some service. So, you know, it's part of this industry. I mean, HR compliance, that's why I talk about some of the vibe coding and tools that are out there. They're great, and a lot of companies will say, oh, that's cool.

You can do that really quick. You know, really fast. Can I put this in? What they have to remember is just the security around it and the scalability. Reliability just needs to come from organizations that have, you know, a track record of delivering and doing the right type of testing and QA to make sure that they don't add headaches.

And that's what I meant by, you know, these cool, gimmicky features. And it's also just fast. They'll give up for reliable so they don't deal with the headaches.

Steve Smith:

Well, in the conversations I've been having with kind of folks in the payroll ecosystem, it's just like they, you know, on the one hand are, a lot of conversation about, yeah, you're not gonna be able to vibe code your way to something that is truly secure and compliant, but you can use vibe coding to rapidly prototype and iterate and move a development cycle forward faster than you ever could to get to that QA part.

Is that what you're seeing with your team? And, I mean, what's the role that you're seeing in your organization in that regard?

Kevin Andrews:

Yeah, there's really two different things. I mean, obviously AI is helping considerably over on the back end, what I would consider kind of deploying code and being able to QA code. If you've got, you know, an agile process in place, you can accelerate that. So you can use it as a force multiplier because, you know, you can write a lot of code, you can test a lot of code, and if you build the right skills and, you know, and governance around it, it is truly a force multiplier.

We're seeing that every day and making huge strides and delivering a lot more product to the end user. Now, the next problem that you'll see is how much can the end consumer actually consume? 'Cause, you know, if all of a sudden you're going from, you know, monthly releases to biweekly releases, to weekly and daily releases.

You know, do they really have a chance to digest all the new features and functions? So there's a balance there always we talk about from a team, but it definitely has accelerated the back end. You then have kind of the front end, where you've got around the periphery. You'll end up with companies that will say, hey, I just saw this product that got developed.

Either vibe coded or a light product that they want to add in to the core. And that's where you just have to be careful and make sure the security and the compliance are where the API and the connectivity actually doesn't, you know, doesn't diminish, number one, you know, the trust that those employees have and the security of their data, and also the reliability of actually transacting whatever that particular product was built for.

So it's a little different back end for us, if you take it inside of an enterprise type application where we can accelerate and use it as a force multiplier, versus where you just have a stand-up startup that can run really fast. It just doesn't have that domain, you know, knowledge and expertise a lot of times around the security compliance that's needed in this industry.

Steve Smith:

So, you know, you kind of alluded to this, and sort of the pace of development and pace of change that we're experiencing now with AI, where it seems like everything is moving a lot faster. And I'm kind of curious, as, you know, an executive who's worked at a lot of high-growth companies and experienced those challenges in a phase of the market where things didn't seem like they were going at warp speed all the time.

As you're kinda looking at the market and how companies are growing right now, do you think that the pace of change with AI is maybe making people miss some important parts and more important steps in the scaling process, or do you think it's making it easier, maybe, in some regards?

Kevin Andrews:

I would say it does both. I think for internal processes, HR, you know, the people that are dealing with the volume every day, using those tools is, today we kind of view it as a ceiling. But it's not any different than when, you know, when the internet rolled out or when all of a sudden people had Excel or Word.

You know, the efficiencies that they got from day-to-day operations, those that adopted it quickly obviously sat at the top, right? That's where the ceiling was. But once everybody started and had access to the tools and train and use, it became the floor. It's just expected. That's how you have to do your job.

That's how you have to leverage. I think there's a ton of value for HR and in the industry to leverage AI to help them more efficiently deliver great value to, you know, to their end users and employees and so forth. I think there's a great opportunity for companies like ourselves and others to deliver more value and even agentic value.

So getting rid of some of the workflows. And if you think about it, you know, we're not gonna be building, you talk about user experience. Everybody thinks of it as human user experience, and that paradigm's changing. What will happen in the future, and what we're already building, is you've gotta build not only for employee interaction with your applications, but agentic interactions with your applications.

So you're gonna have agents that have to interact with those that are actually doing some of the work that before people would click through screens. It's not all about click-through screens, it's gonna be more of an approval process for a lot of these workers, where today they're actually doing steps and processes to do things like process payroll or termination or benefits and so forth.

That'll hopefully be somewhat almost all automated through some of the agentic workflows.

Steve Smith:

Well, and, you know, obviously you are a customer-centric organization and you're trying to make sure that you're serving the needs of your customers. How, you know, how are you approaching that role as sort of, like, the Sherpa of helping them understand how do I operationalize AI in my organization and do it in a responsible way?

Kevin Andrews:

Yeah, I mean, the operational side of AI is, you know, we've gotta provide them not only insights, but good tools that they can use and be a trusted source for that. So we've gotta make sure that when we talked to them about, you know, what does good AI look like, that we're not only providing solutions, but we're also almost having an advisor through this process, and make sure we're very transparent in what we're trying to deliver.

And then it's also working closely with customers, making sure, you know, what are they trying to solve, and not duplicating. You know, I was in a BR, business review, with one of our large customers, and that's a lot of the conversation. You know, we had the six-hour conversation across a lot of topics, but one of the dominant ones was saying, hey, we wanna make sure we're not duplicating.

You know, roadmap items you're already doing, because of this AI thing, we can go and feel like we can build a lot of tools to help us be more efficient. But what are you building? We wanna stay away from the core. We wanna make sure we're adding value to customers. And so I think it's a lot of collaboration, because of the speed in which some of these things can be done, making sure that you kinda align with your customers and you're communicating efficiently and effectively to them on where you're headed and what you're gonna be delivering, so they can focus on things where they can drive value.

Steve Smith:

Well, when you think about, you know, back at the beginning of your career, if you could go back and mentor that guy, what would you tell 2000s Kevin about being a founder? Being an entrepreneur, growing a business?

Kevin Andrews:

Yeah, that's a great question. So, I mean, obviously the things that you do as an entrepreneur and what you learn. There's a lot that can be said about, you know, experience, and a lot to be said about people too, right? You know, when you look at what kind of people exist in your organization and making sure that you have the right ones and the right partners.

I would go back and say, you know, make sure that I pick the right customers and the teams, you know, as carefully as your technology. They shape the company more than probably the code that you write. And then, as I talked about, distribution, the scale beats innovation almost every time. So if you can solve real workflow and problems, you know, don't take a chance on these clever ideas and things you think are gonna be a little bit different out there.

And then I'd probably tell myself, you know, trust the long game. The compounding only shows up later, so you gotta keep showing up every day and driving toward what those objectives are. You know, but back to kind of what you say, you gotta pick the right customers and the team carefully, 'cause that really shapes who you are.

Steve Smith:

Well, and I mean, that's great advice, and I mean, that is difficult to do. I mean, especially, you know, when you're an early-stage entrepreneur, it's just like, you're just trying to sell to whoever you can sell to. And there's, I think, a lack of awareness that you don't want every customer. You want to get the right customers, because the wrong ones can really take you off of your game and take you off of your roadmap, and that's such a hard thing to do.

Kevin Andrews:

Yeah, I mean, I think what I learned through that process is when you have the wrong customer that's, you know, demanding and wants something specific to their industry, you have a tendency to go say, oh, I gotta chase that revenue. And you go build something that's custom, and then all of a sudden, kind of, blocked yourself in to a specific, you know, way your technology works and how you can deliver at scale to others.

So I always tell entrepreneurs that ask me over the years, you know, what would you do differently? And it is one of those things that I talk about. Hey, just choose the right customer and make sure you're developing for 80%.

Though that 20% is what really drives you into longer, you know, a longer runway to an outcome that you're probably looking for, is go serve 80% of the market. If you try to go serve the 20% through customization just to chase dollars, you'll end up slowing down your process and potentially completely diverting where you want to end up at.

Steve Smith:

So when you look at employee benefits and enrollment in 2030, do you think it's still the thing that we have known for decades, or do you think it's gonna be something completely different?

Kevin Andrews:

I think it's gonna be different. I mean, I think it'll be conversational and continuous. I mean, I think the guided, year-round type approach is what will happen, to educate people year-round that are interacting, not just this 30-minute kind of panic every November that people kind of run in and say, oh, I gotta do my benefits and make quick decisions.

I'll just keep what I did last year. Wait a second. There's new plans. What does this mean? So decision support, you know, powering some of that decision. And looking at personal data, especially with AI, I think employees will still be kind of holding onto the steering wheel, but we gotta give them more tools.

It's kinda like going and saying, hey, I'm gonna put you in a Tesla that's a little more self-driving, and it's gonna be an easier experience. When you need help, you can turn on autopilot and hopefully get you to your destination. And I think it's one of those things we're gonna have to try to look at from, you know, where do we make that experience better?

It's gotta be conversational, it's gotta be continuous. I mentioned it can't be just once a year. It's gotta be year-round. We've gotta give people the insights they need, 'cause their lives aren't once a year, right? They change. Like, people are having babies, they're getting married, you know, their situations change, they get raises, and we just do a poor job of helping them navigate that on the life events and the true path of a normal person and where they need those benefits and interact with HR.

Steve Smith:

Well, you know, you and your team are doing such amazing work, you know, serving SMBs and really kind of raising the bar on HR tech for SMBs. But what do you see when you look at the market? Do you see something that maybe SMBs still aren't getting from HR tech, or where they are underserved right now?

That, and do you see, where do you see the opportunity, I guess?

Kevin Andrews:

I mean, there's always opportunity in HR tech. I think, you know, enterprise-grade insights without enterprise-grade complexity or pricing is always, you know, the catch. And, you know, they want tools that work the way SMBs actually run. And from an SMB perspective, I love seeing some of these new companies come up, and there's some good ones, right?

You've got individuals that have a lot of talent, skills, have left and started their own, and do have some of the fundamentals, understand, you know, security and scalability. And I think you'll see some great products come in to serve those SMBs on how they run their business. A lot of bespoke type platforms, and hopefully fewer dashboards and more answers and more conversational interaction.

As I mentioned, I don't think you'll have, you're gonna have agentic type users, and that's how software's gotta be developed. And you'll have SMBs that need more approval, but they need to be able to do things like, yeah, hey, I want to approve payroll from my phone. It needs to be conversational.

I need, I got hours on somebody that kicked back and had told me that, hey, I missed hours for John before payroll run. And I can answer it as a conversational interaction versus going in, log in, get to the right screen, do the inputs. So that's where I think we're headed. And that's exciting, because that takes for a better experience for end users, and I think makes the industry better as a whole.

Steve Smith:

Well, Kevin, thanks so much for your time. I really appreciate you joining us today and sharing your perspectives. This has been a great conversation, and hope we get a chance to do it again sometime.

Kevin Andrews:

Yeah. Great, Steve. Great to meet you, and thanks for the opportunity.

Steve Smith:

The clearest moment in this conversation is when Kevin pushed back on the idea that PEO software is just boring compliance plumbing. He's right that the plumbing is where trust gets built or lost. Get it wrong, and one bad payroll run becomes the only thing a customer remembers about you.

That's the tension running under this whole conversation. AI can make development faster. It can help teams ship more, test more, and move product forward quicker than ever. But payroll and compliance don't reward speed for its own sake. They reward getting it right, every time, for every employee.

Kevin doesn't think AI replaces the systems HR runs on. He thinks it makes the parts people actually experience simpler: fewer dashboards, more conversation, less panic every November when open enrollment hits.

The advice he'd give his younger self applies well beyond HR tech. Pick the right customers. Build for the eighty percent. Trust that the compounding shows up later, even when it's not obvious yet.

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