Contractor-First Payroll Platforms
Anthony Mironov, CEO of Wingspan, on why 1099s are eating payroll
This shift matters because payroll software built for stable employee rosters breaks when a business runs on hundreds of variable contractors instead. A W-2 flow is repetitive and predictable. A 1099 flow means collecting W-9s, verifying identities, routing payments, tracking invoices, issuing tax forms, and handling classification risk for every new worker. As more companies staff core operations with contractors, payroll stops being a narrow HR system and becomes a cross functional payments and compliance system.
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The real change is not a few side freelancers at startups, but businesses whose operating workforce is mostly 1099. Wingspan focuses on companies paying hundreds to thousands of contractors each month, often with only a small W-2 base. That is a very different workflow from Gusto style SMB payroll.
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The market is broad, but not one uniform bucket. A designer, an Uber driver, and an insurance adjuster are all 1099, but they only share a few common problems, mainly taxes, onboarding, and payment. The winning products narrow in on the workflows that repeat across a specific contractor heavy segment.
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That is why every back office platform wants contractor payroll inside its bundle. The prize is not just software fees. It is control of payment volume, contractor identity data, and follow on products like instant payouts, insurance, and lending. Prior research sized freelancer earnings at $1.4T in annual B2B payments.
The next phase is payroll systems that treat mixed workforces as the default. Platforms will combine employee payroll, contractor onboarding, mass payouts, and contractor financial products in one stack. As AI labs, healthcare networks, and service marketplaces keep hiring specialized labor on flexible terms, the center of gravity in payroll will keep moving toward systems built for 1099 density, not W-2 stability.