We talked to David Lester, founder of Startups – the UK’s most visited small business site, following the launch of his latest business – citrusHR, which allows firms to manage all of their employment law and HR processes on an all-in-one cloud-based platform.
The latest ONS data shows that the number of people working for themselves is at a record high. Has this been reflected in demand for the services and information you offer on Startups?
Yes, we have seen record numbers of people coming to startups.co.uk looking for information, whether that is finding out what sort of business they might start or how to go about starting up.
What do you see as the main challenges for start ups as the economy continues to recover?
In general terms a recovering economy should be good for all small businesses. However, increased competition is a main challenge to watch out for—both for customers and suppliers. If you stay close to your customers and continue to give them what they want at a fair price though, you should find the recovery has a net positive impact on your business.
Did the recession change the business landscape for prospective startups, and if so – for the better or worse?
Recessions often have a way of clearing away ailing businesses, which then results in more business for the healthier, surviving firms. This happened much less in the last recession, mainly due to banks giving businesses much more flexibility when repaying overdrafts.
So I suspect the recession has not made much impact to the landscape directly. However, at the same time as the recession the global economy has seen an enormous structural shift towards digital activity. Retail and publishing businesses have felt the effects most, with many larger businesses suffering while smart new startups have gained significant market share.
What inspired you to set up your new business, citrusHR?
The idea for citrusHR came initially when I started looking for something like it a few years ago, and found that – to my amazement – there were then no online employee software options for small businesses at all. I had heard hundreds of other entrepreneurs complain about the burden of employment red tape, and could see that lots of smaller employers could benefit enormously from the right online solution.
Although we still have plenty more we want to add to citrusHR, it does now offer HR software designed especially for smaller employers, as well as a number of other services.
Many businesses worry about taking on an employee for the first time – how would you allay these fears?
That’s right, many people really worry about taking on their first employee. The worries tend to stem from wondering whether someone will be able to comfortably pay the wages each month, but also how they can easily cope with all the employment rules and regs.
Most people know that they need to register with HMRC and pay their staff through the PAYE scheme, and they also know of other laws which apply and which could cost them financially if they break them—yet they don’t know what they are or how to find out without spending an arm and a leg.
That was a large part of why we set up citrusHR, which provides the only comprehensive service which is really affordable for small employers — our prices start from as little as £15 per month for the full service, compared to probably at least £100 per month for an HR consultancy or £200 per hour for an employment lawyer.
How do you keep your software and advice updated, given the frequent changes to employment, and other laws?
In short, our team works hard! Seriously, our HR experts keep us up to date with the changes in law (helped by our partners Keystone Law, one of the fastest-growing law firms in the UK), and we have an ex-corporate lawyer who explains each change clearly and puts them into a small business context. It is then ready for our developers and testers to make sure that we can update the system when we need to.
For example, we have recently had to update our Flexible Working Policy for changes in the law, and have just added a feature to automatically warn employers whenever they have an employee who appears to be earning less than the National Minimum Wage; the rates changed on 1st October and these warnings were live by the 3rd, which we’re rather proud of.
Can small businesses integrate any of their existing processes / documentation (e.g. employment contracts) with citrusHR?
Of course. citrusHR is designed for existing small businesses and charities as well as new ones—and we know that most existing employers will already have some sort of contract and set of policies. So citrusHR will happily work with your existing employment contracts and policies, or if you are concerned that they might be out of date, you can ask our HR consultants to look at them and we can then advise about whether to move to our documents, and if so, how to go about that. We try to be as helpful as we can, as we know how precious time is for all small businesses.
What are your plans for the future – with Startups, and this new HR venture?
I am really excited about the future. Startups has a fantastic team right now, and is going from strength to strength… I will continue to oversee that, but am fortunate that I am now able to step back from the day to day operations there to focus on building citrusHR into a major support service for small businesses and charities.
Also, try these recently published HR articles on Company Bug: