Hitting New Milestones: Check's 2023 Year End and 2024 Year Start Super Bowl

Some industries have “Super Bowls.”

In my first professional life, I worked in internet advertising. The Super Bowl of internet advertising is the period starting ~2 weeks before Black Friday and Cyber Monday, and leading up until Christmas Day. This is because it’s the time of the year when Americans spend the most amount of money buying stuff on the internet, and consequently is the period of time where dollars put into advertising can yield the highest return on investment. In AdTech, we made more money during our Super Bowl period than at any other point in the year, and so we routinely instituted a code freeze – we didn’t want to do anything that would jeopardize our uptime during this critical period.

Paul Graham recently tweeted about a different startup whose user signups graph reveals what appears to be a Super Bowl dynamic. No, it wasn’t Check – it was a language learning product – but as you can see, user signups pop in January due to the new years resolutions of people who want to learn a new language (gyms and other related products and services also see January pops for the same reasons).

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If you think about it, you may find that the industry you work in also has a Super Bowl. For us as the pioneers of the embedded payroll industry, our Super Bowl is Year End and Year Start – the period from December 1 until January 31. During this time of the year several important things happen:

1. The prior calendar year closes, and we become responsible for generating and filing 941s, W-2s, and 1099s for all companies, employees, and contractors that were paid through our system in the prior year.
2. The new calendar year starts, and we are met with a large influx of employers who want to leverage the clean slate of a new tax year to minimize their switching costs to a better payroll provider.
3. New versions of tax forms are released at the federal, state, and local level across the U.S., along with new tax laws, tax rates or sometimes new taxes altogether!

And as a result of point 2 above, Check’s user signup graph looks a lot like the one Paul Graham shared above. The number of people we added to the platform in January was a huge jump from where a linear projection would have put it.

What makes this period particularly exciting and challenging is that all this growth happens while we’re busy wrapping up filings for the hundreds of thousands of employees we paid on behalf of tens of thousands of employers in 2023. The vast majority of our tax filings for 2023 were made electronically. We aim to file electronically as much as possible, but, some state governments aren’t ready to accept electronic filings yet. As a result our Tax team sends thousands of envelopes out every Year End. Our team has actually started measuring the number of filings they’re mailing out in inches!

We’re constantly iterating across all of our teams to make Year End and Year Start more seamless for our partners and their end employers. This hard work from our Tax and Ops teams has been paying off, which is why we’re thrilled to share that companies on Check had a 96% first filing success rate in Year End 2023.

Another area that’s exciting for us is Embedded Setup, our offering to make onboarding onto Check an order of magnitude easier, which we formally launched in December 2023. Embedded Setup now accounts for 10% of companies going live on Check on a monthly basis. Our partners are seeing improved conversion rates and go-live times by using it, and are simultaneously able to offload the work of onboarding new employers to Check and grow their businesses more quickly. 

We also launched Morning Next Day Pay on January 1st this year, allowing our partners to offer payroll approvals up until 8pm ET the night before payday, and employers to rest easy knowing that employees will receive their paychecks via direct deposit first thing in the morning.

All of this means that collectively across our partners, Check paid hundreds of thousands of employees across tens of thousands of employers in 2023 — and distributed billions of dollars in payroll funds.

None of this would be possible without our team’s laser focus on building the best embedded payroll platform in the world, and making Year End and Year Start a breeze for our partners. That work is only intensifying in 2024. We’re seeing across the industry a continued drive for our partners to become all-in-one solutions for their customers, and payroll has become a when not an if for many software companies who offer services to different parts of the economy. We’re already working with many more teams who are going to launch category-shifting payroll products in the next 12 months, and are eager to speak to any entrepreneurs who have a grand vision for how paying people could be made simpler in their corner of the economy.

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We here at Check are looking forward to 2024 and the innovations our partners will drive. If you’d like to learn more about how Check can support your payroll needs, please get in touch.