EzPaySlip: Cloud based payroll system built to fit the reality of East African SMEs

On a regular basis we put ventures in the spotlight that have registered on our platform. Today we talk to Danish entrepreneur Michael Pedersen, the man behind the Kenyan financial management ventures ezPaySlip and Uhasibu. “Kenyans want to deal with real people, and are less likely to do product research to identify solutions to their problems on their own.”

Why is the are need for ezPaySlip in Kenya?

“There are 150,000 registered companies in Kenya and without a doubt the majority has employees. Paying these employees require that you calculate PAYE (Pay As You Earn) tax and other statutory requirements as NSSF (social security) and NHIF (health insurance). EzPaySlip helps you with this process, and more importantly with submitting these reports to the required organizations. EzPaySlip is a cloud based payroll system specifically for SMEs, built to fit East African businesses’ reality.”

What makes ezPay$lip better than other payroll systems?

“The existing payroll systems in the market generally focuses on the ‘calculation’ part of the payroll process, leaving you to do submissions manually. EzPaySlip looks at the entire process from adding up individual commissions to the actual submission of reports to the relevant official organizations. For example the system is integrated with KRA’s (Kenya Revenue Authority) system and will submit the tax report on your behalf with just a click – without you having to use/learn how to use KRA’s system yourself.

In other words, the main differentiation of EzPaySlip is it’s tight integration with other financial systems – hereby enabling you to become fully compliant on your reporting, submissions, and accounting with just a click of a button.

In addition to this the system is an online cloud based system, based on a subscription model, where as most other payroll systems in the market are “traditional” software systems based on a (larger) ‘one off’ license fee. It can be difficult for many SME’s to dedicate a lump sum in their cash-flow to invest in such a system, where as a subscription model generally is acceptable to SMEs cash-flow.”

Did you build the cloud-based system from the ground up? Why?

“EzPaySlip is build on-top of the framework and technical infrastructure already in place from the development of Uhasibu. Hence we have been able to focus on the business logic and usability in the development process. EzPaySlip naturally integrates fully with our Uhasibu accounting software.

We do indeed control the entire technology-stack/intellectual property. Licensing third party technology was not really considered partly because we believe that there are no existing system out there with the feature set we wanted to bring to the market, and partly because we have very strong development competencies making it likely that it would be easier and faster for us to build it rather than having to find, validate and finally negotiate licensing of a suitable system.

Finally we aim to offer the system at a very affordable rate to SME’s (pricing not finalized yet, but something along 500-1000 Kes (€4,5 – €9) monthly), having to paying licensing fee’s to a third party would increase cost and generally make it more difficult to achieve this market price.”

As just mentioned, you are also running accounting system Uhasibu. How is that project taking off, and what have you learned there that you use at this project?

“Uhasibu is growing daily, and we keep pushing it though a direct sales effort. We are also aligning ourself for strategic partnerships which will boost the solution even further. We are still investing in the product/system but we are getting closer and closer to sustainability each day. I would like to invite everyone to take a look at the new testimonial section of our website.

There are obvious technology similarities in the development of Uhasibu and EzPaySlip, since they both operate in the the same domain of financial management. This has greatly simplified the development process.

Apart from the technology there are many lessons learned from Uhasibu, but maybe the key one is that Kenyans really want to deal with real people, and are less likely to do product research to identify solutions to their problems on their own. To a large extend you can say that Kenyans want to hear about your solution from someone, either a friend, an advisor or from a sales person – so you have to make sure someone is telling the story about your product.”

 The EzPaySlip / Uhasibu team

With Uhasibu you won the ‘Business and the Enterprise’ award of Pivot25. What is your opinion about these competitions?

“Events such as Pivot, DEMO Africa and others, are all great opportunities for generating exposure for the projects that innovators/entrepreneurs such as our team are working on. The exposure we got from Pivot25 ensured that we had clients signing up the first day after officially launching Uhasibu. We are hoping that we are able to use DEMO Africa to get EzPaySlip of to a running start in the same way. Also these events are a great place for identifying much needed talent to further boost your own project.”

Tell us about your team?

“The management team consists of Angela Nzioki (sales & marketing manager) and myself  as product manager. Angela is actually co-founder of one of the Pivot25 finalists, but after seeing her convincing presentation at Pivot, I approached her and luckily persuaded her to join our team. She has a background of Business and IT and have previously worked with Craft Silicon. In addition our team consists of Jerhqouelyne Lemmy (developer) and Willis Simiyu (sales), and we work tirelessly at improving our product(s) and market-share.

I am a born geek and entrepreneur, having a background in computer science and business administration. I have been developing software for more than 20 years and have been an entrepreneur even longer.”

How did you end up in Kenya?

“I was originally stationed in Kenya for 6 months in 2007, as part of a Danida project aiming to transfer Western knowledge to developing countries. During this period I learned a lot about how SMEs and Kenya in general operate. After returning to Denmark I followed the Kenyan technology scene from the sideline. After the fiber finally arrived starting the technology boom in Kenya that we are witnessing today. I noticed this emerging boom, and decided that I needed to be part of it somehow, so I went to Kenya and started Uhasibu.”

What are your future plans?

“Keep executing! Essentially I want to continue improving the value offering of Uhasibu, by improving the system itself, forming more partnerships and by launching supplementary products – such as EzPaySlip. Naturally all with the shared goal of continuing to grow our market-share.

At some point in the future we will need to adapt our products to the legislation in the rest of East Africa so that we can fulfill our vision about having the most relevant product offering for SME’s in all of East Africa, and not just Kenya.”

See the EzPaySlip venture profile on VC4Africa for more information