Sean McMahon

Sean McMahon asked for more specific reasons why AI advancements are not as significant a risk for Paylocity as market sentiment might suggest, pointing to potential moats beyond the service organization, such as banking relationships, payment rails, and the inefficiency of using GPUs for payroll calculations.

Answer

Steve Beauchamp, Executive Chairman, outlined several moats: the extensive customer interaction and service component, the complexity of interfacing with thousands of tax agencies with constantly changing rules and deterministic calculations, and the capital structure required for such operations. He emphasized that AI is seen as an opportunity to enhance client experience, make software easier, and expand use cases, rather than a threat to core payroll functions.