Central

What do they actually do

Central is a managed back‑office service for startups that runs payroll, health benefits (including insurance and 401(k)), state registrations and compliance, PTO tracking, contractor payouts, and routine filings. Unlike self‑serve HR software, Central bundles software with a team that handles the work for you on an ongoing basis https://centralhq.com/, https://centralhq.com/pricing.

Onboarding starts with a short call and a white‑glove migration (they pull data from your current provider or help you enter it). After that, Central operates recurring payroll, filings, benefits administration, multi‑state compliance, and global contractor payments (200+ countries) using a mix of automation and human specialists. Customers access a web app and a Slack “AI teammate,” and Central integrates with banks for payroll funding. The company markets coverage across all 50 U.S. states and notes it is “Trusted by 500+ startups” on its site https://centralhq.com/, https://centralhq.com/pricing, https://centralhq.com/customers, https://www.g2.com/products/central-central/reviews.

Central is beginning to expand beyond payroll/benefits into adjacent services like accounting and taxes, with early work on an AI accounting assistant that automates reconciliations while humans handle exceptions. These add‑ons appear to be in active rollout and pilots rather than fully generalized offerings today https://centralhq.com/pricing, https://puzzle.io/blog/central-ai-accounting-assistant.

Who are their target customer(s)

• Early‑stage founders (solo CEO/CFO equivalents).: They don’t want to spend time on payroll, filings, or benefits admin and need a provider that will run it end‑to‑end so they can focus on product and customers https://centralhq.com/, https://centralhq.com/pricing.
• Head of Finance / Finance Ops at a scaling startup with multi‑state footprint.: They struggle with state registrations, payroll taxes, recurring filings, and international contractor payments without adding headcount https://centralhq.com/pricing.
• People Ops / HR managers responsible for benefits and 401(k).: Manual enrollments, benefits reconciliation, and a high volume of employee questions across multiple vendors slow them down https://centralhq.com/pricing, https://centralhq.com/customers.
• Leaders at remote‑first startups hiring globally.: They need reliable, compliant global contractor payouts in one place instead of stitching together local vendors or payment rails https://centralhq.com/pricing.
• Small finance teams wanting to outsource bookkeeping and back‑office tasks.: Recurring migrations, reconciliations, and tax filings consume time; they prefer a managed + AI‑assisted model with white‑glove onboarding https://puzzle.io/blog/central-ai-accounting-assistant, https://centralhq.com/.

How would they acquire their first 10, 50, and 100 customers

• First 10: Founder‑led outbound to YC/founder networks with free or discounted first payroll runs and guaranteed white‑glove migrations; capture time‑saved metrics and testimonials to use as reference wins.
• First 50: Standardize short demos and a migration playbook; lean on accelerator/VC/referral partners while using case studies to drive inbound and a clear offer (e.g., “we do your first payroll + benefits migration”).
• First 100: Broaden ICP to Finance and People Ops leaders with add‑ons (multi‑state, contractors, accounting); run land‑and‑expand, hire SDR/partner roles for scaled outbound, and test targeted paid channels while keeping a premium white‑glove tier.

What is the rough total addressable market

Top-down context:

Central sells managed payroll/benefits/compliance to U.S. employer firms; there are ~6.27M U.S. employer firms, and Central lists pricing at $50 per person per month plus a $100 monthly platform fee https://centralhq.com/pricing, https://advocacy.sba.gov/wp-content/uploads/2024/12/Frequently-Asked-Questions-About-Small-Business_2024-508.pdf.

Bottom-up calculation:

Annual revenue per customer ≈ $1,200 + $600 × headcount. At 10 employees, ARPC ≈ $7,200; at 24 employees, ARPC ≈ $15,600. Applying these to 6.27M firms yields a theoretical U.S. TAM of ~$45B–$98B; at 5% penetration, ~$2.3B (10‑employee case) to ~$4.9B (24‑employee case) https://centralhq.com/pricing, https://advocacy.sba.gov/wp-content/uploads/2024/12/Frequently-Asked-Questions-About-Small-Business_2024-508.pdf.

Assumptions:

• Focus on U.S. employer firms only; excludes non‑employers and non‑U.S. payroll.
• Average customer size scenarios use 10 and 24 employees to bracket early‑stage vs. typical employer averages.
• Pricing remains at $50/person/month + $100/month platform fee; excludes future add‑ons (accounting/tax).

Who are some of their notable competitors

• Gusto: Software‑first payroll, benefits, and HR for small businesses; self‑serve model rather than a managed service https://gusto.com/product/payroll.
• Rippling: All‑in‑one HR/IT/finance platform with modular products and automations; chosen by teams wanting a unified, product‑centric stack rather than outsourced execution.
• Deel: Global payroll, contractor payments, and EOR across many countries; strong for cross‑border hiring and compliance https://www.deel.com/payroll/global/.
• Remote: Global payroll and EOR that emphasizes owning local entities and in‑country compliance; a hands‑off option for international employment https://remote.com/global-hr/global-payroll.
• Justworks: U.S. PEO bundling payroll, benefits, and compliance under a co‑employment model; an alternative for small businesses seeking bundled benefits https://www.justworks.com/peo.