One of the things I like to do in profiling #CoolGigCompanies is finding entrepreneurs who see an opportunity in the Gig Economy that many others may have overlooked. Craig Lewis of Gig Wage is one of the guys.
Craig spent a lot of time in the payroll world. His “aha ” moment came from years spent at large firms like ADP, one of the largest payroll processors in the US. There he realized many small and medium sized businesses did not have a modern way to pay contractors. What he saw was that many companies were paying employees with products designed for payroll, but then using these same systems to pay contractors as well. These payments were not really payroll items but payables, making this a costly way to pay contractors.
After successful stints at various payroll and technology companies, Craig couldn’t shake the need to solve the problem he had identified early in his career. Why hadn’t the industry created a payment system for independent workers specifically designed for small businesses who hire them? Craig seized the opportunity and Gig Wage was born.
Dallas, Texas based Gig Wage recognizes the growth in the independent worker marketplace, which is growing 3 times faster than the traditional workforce. It is a given that the large platforms for this talent, like Uber and TaskRabbit are equipped to pay contractors efficiently. But there are many smaller talent marketplace companies that get bogged down using technologies designed for employees. Their contractors suffer as a result and their ability to grow can be constrained.
More interestingly, Gig Wage is looking at some industries that are big users of contractors that the rest of the gig economy giants seemed to have overlooked. For example, Gig Wage targets the real estate industry, where realtors are independent contractors (IC) Similarly, trucking firms who engage drivers as ICs could benefit for the lower cost and more customized services Gig Wage provides. By reimagining these more traditional economic sectors, Gig Wage is providing its own brand of payment system disruption.
And, the cost differential Gig Wage delivers is significant A traditional payroll service costs $2-$8 per month on top of a base fee for every check. That is because, according to Craig, “Contractors were treated like the red-headed step-child. “ ( I pointed out to him that I have a red headed daughter, but he noted it was not my stepchild…touché…) Gig Wage charges just $1 per direct deposit. For a real estate office with 100 payments a month, the savings can range from $1200 – $8400 annually. Just as important, the contractors like the process as well, because funds are deposited automatically; with Gig Wage the typical hold that might be on a commission check for a realtor, will become a thing of the past.
The next frontier for Gig Wage is to serve the on-demand community. It never ceases to amaze me how many talent platforms exist in the US, many of whom play in very niche markets or defined geographies. Grub Hub may be the major food delivery service in San Francisco, but then there is Menu Runners in Texas, a current Gig Wage customer. As a small and growing tech enterprise, Menu Runners is paying hundreds of contractors, and now they are benefitting from a more cost-effective, streamlined way to pay them. Gig Wage is supporting a developer marketplace to foster even more innovation. So in addition to the app for more traditional businesses, Gig Wage will be releasing its APIs this year for the developer community.
And more interesting innovations are on the horizon. Some of the features Craig cited for the next release were the integration of Gig Wage with financial systems targeted at ICs like Xero and Intuit as well as the development of a payment card for ICs. This payment card structure will be valuable for many firms and ICs but especially for those in transportation, like truckers, who are paid as contractors and always on the move. Additionally,same day and instant payments will also be rolled out soon.
Like many start-ups, Gig Wage has so many options as they pursue aggressive growth plans. Further financing rounds are on the horizon. I would bet on them, since from my perspective the firm is solving problems in marketplaces that others are not talking about. You have got to love a monopoly…
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