Storytelling About ZayZoon With Tate Hackert

William Tincup: [00:00:00] This is William Tincup and you are listening to the Use Case podcast. Today we have T on from Zum and we’ll be learning about the business case or the use case, maybe even something about the origin story of Zum. Tate, would you do us a favor and introduce both yourself and Zum?

Tate Hackert: Yeah, certainly. I guess my name’s Tate Hacker and

William Tincup: let’s start there.

Tate Hackert: I I’m with a company called Zun. We we provide earned wage access to employees across the United States. And really, what we do is provide an alternative to payday [00:01:00] loans and overdraft fees. So right when there’s this sort of precarious moment between paydays. Employees find themselves needing cash, right?

They need to have this short term liquidity and unfortunately, heyday loans, overdraft fees going late on a bill payment. They’re not really good ways to deal with that. And so Zsu was really the solution to combat that. It’s a way to give employees access to the hours that they’ve already worked prior to the regularly scheduled a day.

William Tincup: You know what I love about this movement is like I was going through a Taco Bell, it was probably two weeks ago, and I saw on the window it said, in fact, I’m looking at him on Instagram right now. Cuz I I thought so highly of it. I actually Instagram it’s cash out when you clock out.

And I’m like, of course that kinda makes sense in the hourly market, right? But the question I asked the people that follow me, I’m like, when’s this gonna hit the corporate market, like the salaried market? Like you’re an accountant, [00:02:00] Deloitte. Yeah. And you’ve worked that week and you just want Okay.

Tab out anyway, so I really love the category that you’re in. It is super, super needed because again the options that they had were a bit. Predatory and high fees and all kinds of stuff like that. And so I just love the category of which that y’all play cuz it’s super helpful to people.

I hope

Tate Hackert: that Taco Bell was one of ours. If not, you gotta go back there and take the sign down and put up his as on the sign. Yeah, no, you, your point about the Deloitte accountant it’s actually not far off, right? Like the funny thing about earned wage access is it provides that liquidity be between paydays and what a lot of people mistake it for is people that live paycheck to paycheck don’t necessarily have. An income issue, right? They have a cashflow issue, right? And no matter how much you make, if you have not properly budgeted, [00:03:00] if you are if you find yourself in, in, in a cash flow crunch, maybe at a lower income rate that is because of a hot water tank that blows, or you might have just maybe not budgeted your gasoline correctly for that week.

And at a higher income level it might be, a car breaks down and you gotta get a new car, what, whatever it might be. It ultimately is this cashflow mismatch. And if you gotta wait another eight or nine days for your payday to come we’ll real life doesn’t happen in, in, in two week increments, it happens every day. And I think that’s where earned wage access is really neat. And to, to your point about the COR corporate world. Yeah. It it does get used in the corporate world a lot less, of course than the hourly world or the, quicker restaurants and manufacturing and whatnot, but, I think I think we’ll all be surprised in another five to seven years here how prevalent earned wage access truly is.

William Tincup: Do do you, do the employers see it as a benefit? Are we selling it to them as a, like an additional benefit that they can offer to their employees?

Tate Hackert: [00:04:00] Yeah, a hundred percent.

We actually view, if you think of like the freemium model, right? You get an app and then you can. Make purchases in that app. We think of earned wage access as a freemium application for employers because it actually, they’re not paying for it. Their employees are, but they’re getting just as much benefit from it.

They’re getting in improved productivity. They’re getting reduced turnover. We actually help fill candidate pipelines twice as quickly just by having in a job description that they can, in fact, work today, get paid today, just like you’re seeing in that Taco Bell window. People are using this, business owners are using this benefit as a way to recruit and retain talent.

And yeah, a hundred percent there’s a lot of benefit for that employer just as much as there is for that employee. Yeah,

William Tincup: it’s it’s, again it’s an attraction tool. Like some, great benefits are, it’s a way to attract talent. And it’s also a way to retain talent.

So [00:05:00] it’s also, it becomes a bid, like why would you go to another job where you can’t do that? Yeah,

Tate Hackert: it’s it’s a hundred percent I think it’s become quite easy, especially the last few years the power has really been in the hands of the employee. And it’s become quite easy for an employee to switch organizations for 25 cents an hour more across the street.

And so employers are really clamoring for any. Benefit that they can provide to their employees. And when that benefit is, of course, no cost to the employer or low cost, I should say, because they do have the option of course subsidizing some of the advanced costs and whatnot if they so choose to do right.

But yeah when that benefit is free to the employer and the employee sees so much return there it really does become this no-brainer for them.

William Tincup: Let’s let’s deal with the product itself. How does, how do employees interact with it?

Tate Hackert: For an employee, it’s really straightforward.

They come into [00:06:00] the app, they see exactly how much they’ve earned, but have not yet been paid for. They are able to access 50%. Okay. Of those wages up to 70%. If they have certain. Characteristics of their work site. Call it 50% on average, they’re able to access their pay.

That pay gets sent to them instantaneously. It can be 4:00 AM Christmas Eve. That money is landing in their bank account in a matter of seconds. Oh, that’s cool. And yeah. We partnered with Visa and MasterCard to be able to provide that benefit. They actually just input their.

Debit card number, and we are able to send funds to their bank account associated with that debit card in real time. Oh, that’s genius. Yeah. Yeah. It’s a pretty cool solution and it’s really neat to actually see the benefit to the employee. We’ve got, we’ve gotten literal outreach in our customer support live chat where someone’s Hey I’m in the grocery store lineup right now.

This better work has advertised cuz I’m, I’m $50 short and sure enough the [00:07:00] money gets there by the time they’re checking out. Yeah. A after they take the money though, come payday that money is just automatically deducted off of their paycheck. And if they chose to send it directly to their bank account in real time using that debit card method, it’s a $5 flat fee.

However, we have two other options that are completely fee free to the employee. One is a Zune debit card, so they can actually take a Zune debit card and use that as their banking account effectively. And then we also have a gift card solution.

William Tincup: Is that like a stored value card or is it, how does that has, is it a bank account and a bank card, like a debit card, or is it, yeah.

Take me into that real quick.

Tate Hackert: Yeah. Yeah it’s a good question. It’s a debit card. It has an account number, it has a routing number attached to. Oh, cool. It effectively becomes that person’s new bank account. So what’s really neat about it is, They might never know that Z Zoom existed. They can come into our app after seeing a [00:08:00] lunchroom poster or receiving an email from their employer.

And when they want to choose the Zsu debit card as a free option to get paid that debit card issues to them within 90 seconds, they have that in their Apple Wallet or their Google wallet. And they’re able to have funds loaded onto that. And then not only that, Payday, they’re actually able to put their check, their entire direct deposit to that account as well.

And it really does become that new that new bank account for that employee. Yeah.

William Tincup: So from a workflow perspective, are we integrated into kind of the payroll systems, like a ADP or Ceridian or something like that? Are we integrated into those things or are we run separate? No,

Tate Hackert: we’re absolutely integrated.

That’s a bit of. Y Z Zoom is such a beautiful business. We spent longer than I would like to admit.

William Tincup: We,

Tate Hackert: we spent years integrating with these payroll providers. Oh yeah. And not easy no. It’s it’s not, and [00:09:00] you’re navigating not just an integration, but a true partnership.

And We actually integrate and then leverage that payroll company for communication and sales and distribution to their clients. And fast forward to today, we have about 150 ish payroll partners all of which, provides Z Zoom to their client base. And so that’s what really makes us a beautiful business for an employer because that employer can be.

An employer of one or two people. Or they can be an employer of 1000 or 2000 people and the service is exactly the same. They’re able to activate Zun in less than 30 minutes. It is completely hands off for them, and really it becomes this relationship between Zun and their employees with the employer being really just this conduit of marketing materials.

Again, I’ll call back to the. So the Taco Bell poster that you saw it really becomes this conduit of marketing materials where they say, Hey, we [00:10:00] have this available for you. Use it if you’re financially stressed or you need to access your pay early.

William Tincup: So industries where we play, obviously we talked a little bit about the hourly side.

Yeah. I think mention you mentioned retail and hospitality and manufacturing. Is it pretty much all high volume or hourly markets?

Tate Hackert: A lot of that. Certainly. So if I were to go down the list at Q S R, so fast food restaurants, hospitality and senior living and health home healthcare is a big one for us.

And then manufacturing as, as well. And so we, I’ll make a call back actually to, to one manufacturing client we have in Ohio that we were visiting this past. Year. We did a, an RV tour across America, and it was such an incredible time. We had a big zun branded bus and brought a couple employees along for the ride.

And in any case we stopped at this big manufac manufacturing plant in Ohio, and [00:11:00] they had just rolled out Zune three months previous. And in those three months they had gone from issuing dozens and dozens of advances each and every month to having issue zero. And so we took that entirely off of their plate internally.

Wow. And, yeah. And they’re claiming that it’s saving them over $10,000 annually just in. Increased banking transaction fees. So just having to do other, more payroll runs, administration of that, et cetera. Yeah.

William Tincup: Printing of checks, mailing, like all kinds of plus, as you mentioned, payday loans.

Then the fees that get on top of that is just, it was insane. Still is insane. I forgot to ask you if you have employees in other countries, so like the four walls of the United States and all the payroll libraries, hard enough to understand much less doing business in Columbia or, wherever.

So how do we, how do you, right now, how does Zun, how do you interact with [00:12:00] global customers?

Tate Hackert: It’s interesting you bring up Columbia. And I have a little story about that. But yeah if anyone hasn’t noticed while listening to this I do have a Canadian accent. I am headquartered in Canada.

Zun is headquartered in Canada, but Noah, a hundred percent of our business is in the United States. It really just has come down to a focus thing for us, I think when you’re Growing business. When you’re a business of any size, really focus is paramount. And we started in Canada, started to look into the United States in parallel and it was really just a no-brainer because the United States took off like a wildfire while Canada continued to slow.

And we decided, you know what we, we need to exit Canada. Go all in here. But on the Columbia front, it’s interesting to bring that up because we did, in fact a couple years ago, enter Australia and Columbia. By way of a joint venture with a business group in Australia that had ties to Columbia.

[00:13:00] And it was a beautiful business for all of about seven or eight months. We had some big name clients as, yeah we had big name clients that we were offering earned wage access to. But again, ultimately it became this really difficult decision of do we continue trying to expand internationally in a market that is, A 10th the size of the United States, right?

Or do we just double down with what we know? And so the, these decisions are difficult, sometimes it’s when you say no, that’s more important than what you say yes to. Oftentimes,

William Tincup: It’s interesting because I advise a lot of tech companies and it’s this becoming focused and being dominant at something, and a lot of folks spread themselves so thin that yeah, they’re in 16 different countries, but not well, and it’s again you’ve dug into the payroll libraries, you know how complicated just the US is.

And so federal, state, Municipal it’s just insane to keep up with. So the payroll [00:14:00] companies keep up with that stuff which bless them for doing so. But you, I think the strategy of going deep into the United States and just becoming dominant, like being the default is great advice. Two questions on the buy side.

One is your favorite part of showing z zoom to someone. So when you, on the occasion that you get to show software to folks what’s your favorite part of showing software? That’s a great question.

Tate Hackert: I, earned wage access is still quite novel. It’s, I think in our world in the HR space, I think we really see this hype of earned wage access, but when you’re talking to a Momand pop shop in Midwest they, it is definitely a novel experience for them.

And so I think when you really see that aha moment of, wait a second, the, I can turn this on in the next 30 minutes and I have to do nothing and my [00:15:00] employees get the benefit it’s really neat to see. And then on the employee front, I’ll be honest, that’s the most powerful part.

Being able to actually have conversations with the with the end customer, the employee that’s using these things to buy groceries or medications or we had one customer testimonial where it was. Getting her daughter into dance lessons and again, just a mismatch in cash flows and the fees were due and she couldn’t quite make it.

And so it’s those conversations that I really enjoy having. And I try to still get involved in customer support quite a bit at Zun, just to really keep a pulse on things. I think it’s, oh yeah. The best way possible as a growing business is to really get to that front line and be able to see it that way.

And then as well with site visits, right? Being able to do a site visit, talk to that employer, but then also talk with the end customer. It’s a really powerful thing.

William Tincup: Questions that you would love for buyers to ask about earned access earned pay, earned wage access. [00:16:00] Again, if it’s literacy and they just, maybe they’ve not interacted with it or they don’t know much about it, or they, they’re super busy and they just haven’t paid attention.

What are the questions that you would love to script for them to ask about? Not just Zun but also the category in which you play?

Tate Hackert: I know them. One of the biggest object objections that we receive is this idea that it’s just very difficult to integrate. I think as soon as you mention payroll, it’s deducting off of the employee’s paycheck.

Movement of money. I think an employer automatically assumes two things. They assume, wait a second, is this my money that you’re using and paying the employee early with. Which it’s not. Of course it’s they’s money that we front to the employee. And then the second question is, payroll.

All of those things like, I just did a payroll implementation. It took me six months and it cost me x amounts of thousands of [00:17:00] dollars. I’m good. I

William Tincup: D&I see we’re, it would help our employees. I’m tired.

Tate Hackert: Exactly. And so I think decoupling as related to payroll and as entrenched into the payroll system and process as it is.

I think decoupling it from the concept of legacy, payroll or this, the fact that it takes so long to integrate and implement in all of this, and just knowing that no, in, in fact it’s 30 minutes or less and you’re up and running is really the key takeaway for employers. You

William Tincup: know it’s interesting because a company that I advise and they, to prove it’s it’s kind of customer insights play.

And so all they need is two fields of Salesforce to get started. They just need access to two fields. Yeah. And they can show you a bunch of kind of forecasting and things like that. And again, what you’re doing is you’re basically saying [00:18:00] again, We don’t, we can get you up. We can get you up and running.

We can get you alive. We can stand you up in 24 hours, whatever the bid is. So you can kinda get past that that, oh my God. The word implementation is like a curse word for a lot of folks in hr, right? And especially a lot of people in payroll, because they’ve all had really horrible implementations through the years.

So being able to say, Hey, we can stand you up. In 24 hours. I think there’s two other things that are either, either objections or they’re just hidden things that, that they’re, that are there. One is, h HR is a tapestry of all kinds of interesting stuff. Succession and outplacement and recruiting, all kinds of fun stuff.

Payroll is about one of those spokes in a much larger wheel, but is the one spoke that you can’t mess up. You know what I’m saying? You mess up as a, an HR leader. You can mess up succession planning or performance management or learning and development or [00:19:00] coaching or mentorship or whatever.

You can make real mistakes there. Payroll not, there’s a, there’s, it is It is one area that you can’t, you just, there’s always gonna be some mistakes, but you just can’t make multiple mistakes in peril. So you might be, you also as you talk to them about, it’s like, Hey, listen, I get it.

Perils critical. We can, you can’t make any mistakes here. Totally get it. We can stand this product up fast and it’s gonna be already integrated with your payroll system. Like you don’t have to do anything. There won’t be mistakes. The other. Is more on the finance side because they’ve used, historically, they’ve used wage act, wage wages as float.

Yeah. So you go do work. Two weeks later we pay you. In the interim, two weeks we’re using that money. So I can see CFOs not necessarily loving this movement. But that’s not the point. Employees and candidates are driving the car. So

Tate Hackert: that’s, yeah. And just to be clear [00:20:00] there, like we, we front the money, right?

So that, that employer, yeah, that employer gets to keep those funds until pay payday. That, that, now

William Tincup: Tate, that’s a huge selling cuz not everyone in your space does that.

Tate Hackert: That’s

William Tincup: exactly right. That is a really, that’s a huge selling point. I don’t you buried the lead ta. That is that’s a really cool thing.

So the last question I have is your favorite or your most, your latest customer success story. Without naming names I don’t, I have no interest in knowing names, but like something you love telling people about how Z changed someone’s life.

Tate Hackert: Oh, geez. There’s a lot. Hello. Hello. I’m trying to think of a specific one.

I, this is actually a couple years ago now, but it was a really defining moment for me because it was the first time where what we were building at Zun was actually very real. We partnered up with like I said previously, we partnered up with [00:21:00] Visa to be able to provide funds to employees quickly.

And as part of that we made a series of testimonial videos with clients across the US in partnership with Visa. And so it was, this small little startup Z Zoom headquartered to Canada, partnering with this big behemoth. I was shipped out to somewhere in Pennsylvania that I cannot even remember the name of now.

And it was a total Mennonite town. So there was horse and buggies everywhere. Oh yeah. Oh yeah. And we show up at a Holiday Inn, which, another big brand name that’s using Zune. And as I walk in with my z shirt on, the employees are going crazy Not exaggerating. They are, oh my gosh.

I use that do you use a or do you work with Z?

William Tincup: I started it sun. It was, it

Tate Hackert: was the, it was the craziest experience ever. And it was no

William Tincup: autographs. No autographs.

Tate Hackert: It was followed by six hours of filming [00:22:00] testimonial footage with this holiday in express. But of course, by nature, filming testimonial footage.

It’s seven hours of conversation with them. Oh, yeah. Oh yeah. And so I’m getting to know them, like at the deepest level of like, why did you first use us? What would you have done if you didn’t have us? What were you using before? Walk me through what you’re actually trying to accomplish in life.

How long you’ve been working here for and what do you wanna do when quote unquote grow up. And it’s difficult to pull out maybe a specific example. But I think that experience in and of itself was so very powerful. And this past fall, we replicated part of that by driving across America and visiting hundreds of locations that we’re partnered with and chatting with, thousands of employees.

And again, like just that whole good feel was present the entire time.

William Tincup: What’s I love about that is, you can tell you’ve built software and an experience that’s changing lives. It’s actually helping [00:23:00] people like so much of what we deal with in the enterprise software space, eh it’s good software and all that stuff, but it’s not changing lives.

This is actually something that has a potential of actually helping someone in the time of when they need it. Yeah it’s,

Tate Hackert: It’s special. And I think that’s why a lot of or I don’t think I, I know that’s why a lot of our team and investors and myself, like why we’re really involved in this mission and involved in the company.

And it wasn’t always yes it’s always been present that’s been the mission, right? But it’s not until you actually are boots on the ground talking with. These individuals that are using your service, that it really hits home and it was yeah. Just such a cool experience and so many,

William Tincup: they start telling you those stories, like the grocery store, ex ex story.

They start telling you those stories. You’re like, oh my goodness, I had no idea. Tate, this has been fantastic. Thank you. So I know you’re crazy busy, but thank yous for carving out time for us. Hey, no thank

Tate Hackert: you. I appreciate it. It’s a good conversation

William Tincup: and thanks for everyone listening to the Use Case podcast.[00:24:00]

Until next time.