Show notes
Subscribe to stay ahead of technology trends. Never miss future editions.Why I built America's most-loved payroll company then reinvented it with AIEddie Kim, Co-Founder and CTO at Gusto, joins NEW ECONOMIES on cracking the small business market, keeping all three co-founders for 15 years, and why he just built the most important product of his career in eight weeks.Watch or listen now on YouTube, Apple Podcasts, and SpotifyDownload the full transcript:Eddie Kim is the co-founder at Gusto, the small business platform that just crossed a billion dollars in annual revenue serving over 500,000 companies across payroll, benefits, HR, and compliance. A two-time YC founder who met his co-founders at Stanford and at a half marathon starting line, Eddie has spent 15 years proving that the most unglamorous problems in business are often the most valuable ones to solve. In this episode, we explore what it actually takes to build a category-defining company in a space nobody wanted to touch — and why Eddie believes he just built the most important product of his career — Gusto Cofounder: The AI Teammate Built for Small Business. We discuss Gusto’s origin story, launched in 2012 as ZenPayroll when every investor and industry veteran told the founders to walk away. We dig into what it means to keep all three co-founders together for 15 years, why radical directness beats carefully packaged feedback, and how Eddie is now reinventing the company with Gusto Co-Founder — an AI agent built to run your back office the way a real co-founder would. We also explore the blank canvas problem holding AI back from mainstream adoption, why the distinction between engineer and designer is disappearing, and how a team of five people went from zero code to full launch in eight weeks.Timestamps(0:00) Eddie Kim, Co-Founder at Gusto (5:40) Lessons from Y Combinator (9:30) 15+ years on co-founder relationships (15:00) How to give feedback to your co-founders (17:45) The early days at Gusto(21:10) Gusto’s new product: Gusto Cofounder (33:05) How to launch new features (38:15) The rise of solo entrepreneurs (41:25) How to avoid distractions (45:20) How Gusto would launch today from scratch(47:00) Lightning fire roundOur notes from this conversation1. Boring Problems Are the Best Problems — If You Can Stomach the Grind In 2011, the hottest companies were chasing eyeballs. Mobile, social, local. Nobody wanted to work on payroll. Hiring was nearly impossible, and one of the category’s own pioneers told the Gusto founders to their faces: don’t do it. That discouragement was actually the signal. The problems everyone avoids are exactly the ones worth solving — because if you can crack them, the competitive field is almost empty.2. The Co-Founder Relationship Is Built in Years, Not Conversations All three Gusto co-founders are still at the company 15 years later — a genuinely rare thing. What makes it work isn’t a communication framework or a weekly check-in cadence. It’s shared values, accumulated trust, and the quiet confidence that comes from having survived a hundred disagreements and come out the other side. Real directness — saying what you actually think — only becomes possible once you’ve built that foundation. You can’t shortcut it.3. The Blank Canvas Problem Is AI’s Biggest Obstacle The reason most small business owners can’t harness AI isn’t capability — it’s context. Install Claude Code or open a frontier model and you’re staring at infinite possibility with no clear starting point. That’s paralyzing. The insight behind Gusto Co-Founder is that AI becomes transformative the moment it’s anchored to a specific domain, with real data and real problems already loaded in. Generic intelligence is a tool. Contextual intelligence is a co-founder.4. Trust Is Infrastructure — and It Takes 15 Years to Build Gusto couldn’t have launched its AI co-founder product on day one. The depth in payroll, benefits, compliance, and tax took over a decade to accumulate. That history — 500,000+ customers, millions of data points on what makes small businesses succeed or fail — is what makes the product genuinely useful rather than just technically impressive. The lesson: trust and data are compounding assets. The longer you stay focused on one problem, the harder your moat becomes to replicate.5. The Future of Building Is Builders — Not Roles The team that built Gusto Co-Founder was five people: four engineers and a designer. No roadmaps, no sprint planning, no documentation. The designer wrote code. The engineers made design decisions. They ran a permanent Zoom call instead of meetings. In eight weeks, they went from zero to launch. That’s not a fluke — it’s a preview. AI is erasing the gaps between specialties. The builder mindset is the only identity that matters now.LinksSubscribe to NEW ECONOMIES (@NEWECONOMIESPOD)Discover Gusto CoFounder (https://gusto.com/company-news/cofounder)Follow Ollie on X (https://x.com/ollieforsyth) Follow Eddie on X (https://x.com/edawerd) Follow NEW MEDIA (@newmediafm)Our NEW MEDIA Community (new-media.co)Related previous episodesIf you enjoyed this episode, help sustain our work by clicking ❤️ and 🔄 at the top of this post. Get full access to NEW ECONOMIES at www.neweconomies.co/subscribe