Payroll startup Remote says it grew revenue 50% per employee without adding headcount

Remote, an Amsterdam-based payroll service provider founded seven years ago, recently announced it has exceeded $300 million in annual recurring revenue while simultaneously becoming cash-flow positive. However, the key development lies in its achievement of a 50% increase in revenue per employee, which was made possible through the comprehensive implementation of AI across its organizational structure.

"As we speak, I am running five different instances of Claude on my second laptop screen—some for my personal use and many intended for Remote," states CEO Job van der Voort in an interview with TechCrunch. Among these initiatives is a Slack agent designed to summarize discussions, along with experiments in agentic AI. The broader implication is that Remote is successfully generating higher revenue without any corresponding increase in workforce.

Van der Voort attributes this surge in efficiency to the company’s extensive adoption of AI across all levels and departments. Employees have been utilizing Remote Labs, an internal marketplace tailored on the company’s proprietary technology, to launch applications that mirror the AI capabilities being made available to clients.

In line with its internal innovations, Remote is also assisting its clients in developing customized workflows. "We recognize that we are ahead of many organizations in this respect," van der Voort comments. "Therefore, we established Remote Build, which essentially employs what investors refer to as 'forward-deployed engineers'—individuals who collaborate directly with our customers and prospects to replicate similar advancements within their organizations."

According to van der Voort, these efficiency gains could potentially amplify further. He notes that Remote's core payroll operations have expanded by over 300% year over year, a growth he predominantly credits to AI integration, although independent verification of this figure has not been provided. Remote claims to now support tens of thousands of companies navigating global employment compliance—a metric that parallels its annual recurring revenue milestone and originates from the company’s internal assessments.

While Remote specializes in managing complex payroll systems, its team has also benefited from mitigating the more tedious and bureaucratic aspects of compensating workers globally. "We've been automating many of these processes; that is our core competency," van der Voort explains. "However, the integration of AI has simplified these tasks, rendering them not only easier but also more enjoyable."

Despite the serious nature of payroll, van der Voort expresses enthusiasm for the market potential it signifies for Remote. He emphasizes that the company serves various types of businesses, not solely those with remote or distributed teams, noting, "We handle payroll for everyone, unequivocally."

In contrast, many of Remote's competitors have pivoted towards an "all-in-one" HR platform approach. However, Remote believes that the current surge in AI and the accompanying commoditization of software validate its commitment to tackling a complex issue.

This strategic focus has also led Remote to establish partnerships and remain open to allowing these partners to utilize AI. The recently introduced Remote MCP—a framework based on the Model Context Protocol—empowers AI agents and external platforms with secure access to payroll and compliance data, enabling tools like BambooHR and Workday to function as an operational underpinning for Remote.

This evolution aligns with the emergence of agentic AI, which may result in some companies becoming almost invisible in a beneficial way. "Utilizing tools like ChatGPT or Claude allows users to fully control Remote; if desired, interaction with our platform may become unnecessary," van der Voort explains. "I believe that's the trajectory towards which we are heading."

Looking ahead, van der Voort envisions AI agents directly engaging with Remote while adhering to the stringent security protocols required to manage sensitive financial and personal data associated with payroll. His own personal AI assistant, an open-source project he has named Jim, has already begun interacting with Remote effectively. "Jim can engage with Remote securely, enabling me to trust that my agent won’t cause disruptions. He has access to essential tools while being restricted from performing destructive actions. These advancements excite us, providing a glimpse into the future."

The developments within Remote may be indicative of broader trends in the tech industry. Like other tech companies such as Spotify, Remote has integrated AI-driven coding, leading to a remarkable 60% increase in code contributions from its engineering team over the past year. "That trend is accelerating; in the past month alone, over 85% of our code has been generated by AI."

While this growth has led to a reassessment of hiring plans, van der Voort assures that there have been no layoffs. He noted that the company had not anticipated a large-scale recruitment initiative. "However, we are now actively evaluating whether we truly require additional personnel or if we ought to concentrate on enhancing the skills of our current employees to effectively utilize AI tools, alongside investing more in AI technologies."

His primary responsibility is to ensure the company maintains financial health while achieving rapid growth. Rising costs associated with AI do not worry him. "Our investment in AI is increasing, but we monitor it closely; it's a strategic focus area we are comfortable with. As we become more efficient, we have flexibility in our budget to allocate towards AI and related projects."

Remote's journey serves as a notable example in the ongoing discourse surrounding the tangible business implications of AI. The organization is not simply leveraging AI to expedite operations; it is reshaping its scaling strategy. The model of enhancing revenue per employee, postponing hiring, and broadening product offerings without proportionate headcount growth aligns with the operational strategies many companies strive to achieve.

Moreover, van der Voort finds the incorporation of AI enhances his own role within the company, stating, "This introduces an entirely new and exciting dimension, I would assert."