Venture Capital Firms Encourage HR Outsourcing to some Professional Employer Organization
Is your Start-up Company popular with Venture Capital Funding?
So your fledgling company is willing to grow. You have a fantastic product, strong sales growth, and a business strategy plan to dominate your market. The only thing you may need now’s funding to get it done. So you may be considering growth capital to finance your expansion. If you have decided to think about funding from the VC firm, so you want their investment, you then must realize the standards they’ll use to make their decision about if you should invest in your organization. Volumes happen to be discussing this subject of getting noticed by VC firms and how to get funding, however, there is the part you possibly will not consider: Demonstrating your focus. Pretend you’re the Venture Capital Analyst
Just for a moment, pretend you are the person reviewing a launch company and so are considering investing in the company with your own money. What criteria will be most important because of the decision? There is a long list that individuals will not likely review here, but one of the criteria will probably be: Am I certain that the start-up will use my funds growing the corporation quickly and not burn it up with the distractions of implementing an administrative bureaucracy and meeting regulatory compliance. As a venture capitalist, you need the management team to show a single-minded focus on product, service, and growth.
Why Venture Capital Firms like PEOs
So how will you reveal to VC funds that your focus won’t be distracted with the administrative tasks of running your launch company? Hire a Professional Employer Organization (PEO). A PEO will handle payroll, workers’ compensation insurance, medical health insurance, supplemental insurance along with a myriad of regulatory obligations related to as an employer. Outsourcing these tasks to a PEO demonstrates that your particular company is focused within the right place, along with your management team will not be distracted from a company mission.
Also, finding a PEO provides instant access with a suite of employer benefits that make your start-up the company a fantastic destination to work…. very important to encourage people to join your team. According to our contacts, General Atlantic Partners (one of the largest VC firms) has roughly one in four of the investment portfolio using a PEO. This statistic demonstrates why entrepreneurs should take a look at finding a PEO.
Finding the best PEO
With over 700 PEOs operating in the USA, finding the best fit PEO at the best price can be quite a challenge. When searching for viable PEOs for your company, you should begin by going for a complete review of your operational requirements. Think about the types of services and benefits which might be essential for your organization. Next, compile a summary of the PEOs which are licensed in your state. From that list, you may need to produce a checklist that suits each of the needs you have with all the capabilities and offerings of each PEO.
Once you have completed your checklist, you’ve got your “shortlist” of viable options. Before contacting the PEOs in your “shortlist”, be sure to have a copy of your worker’s comp loss runs plus a complete benefits census of your respective group (if you want medical health insurance as part of the PEO’s services).
Finally, contact each PEO, provide your underwriting data, and wait for the proposals from each PEO. Once you have received your proposals, evaluate each for the price, and fit for your company. While shopping for top fit PEO can be time-intensive, the results will be ensuring a relationship that will give you the services you need at the price you can pay for quite some time to come.
