Why use an API?
During our work with startups, we have observed that many tend to select and invest in products or features that are not essential to their needs. Here, we aim to provide an explanation of what is necessary for a startup operating in the gig culture.
Let me tell you a story about a startup that began small but grew rapidly. At first, the company relied on a manual process to pay its freelancers, with the founder keeping track of everything in an Excel sheet. This might have been the right way to start out, but as the company grew, the manual process became a burden.
It became harder to recruit workers because not everyone was willing to start their own company just to take a few jobs here and there. Then it became a problem that not all workers were invoicing correctly, but the founder was only able to help a few struggling workers.
This was a ticking time bomb that would eventually lead to more problems.
As the workforce kept growing, the process became more of a big project and the founder realized that they needed an accountant to handle the growing number of invoices.
The founder also started using Stripe Connect, which automated some of the processes, but it was still expensive to move money into an escrow and split it between the company and the workforce.
Other unexpected problems started to arise, such as workers using their partner's bank account or losing their driver's license, causing headaches for the founder. The onboarding process needed to be streamlined.
The manual process that the founder had been using was no longer sustainable and was taking up too much time. The founder realized they needed a solution that could fix all their problems related to freelancer payouts, onboarding, and verification.
In short, the problems that the startup faced were a result of relying on a semi manual process that worked for a small number of workers, but became burdensome as the company grew. Implementing automation for the payout and onboarding processes in the early stages would have saved the founder time and prevented many of the issues they encountered.