What are you doing to stand out from the crowd?

We place an intense focus on keeping our customers happy. We solicit opinions on everything from future software enhancements to our customer service practices and make changes accordingly. This philosophy has helped the company expand into 12 new markets in the last year. In spite of the down economy, we expect our operating revenues to grow by over 30% this fiscal year, which ends in June. In these tough times, people are looking for a better value and better service from all of their vendors.

Name: Steve Sarowitz
Business: Paylocity, a payroll and human resource software provider.
Industry: Software
Location: Arlington Heights, Ill.
Year founded: 1997
Number of employees: 205
Web site: Paylocity.com

What's the best part about owning your own business?

Providing a great place to work for our employees. We’ve gone out of our way to ply our employees with engaging and fun activities such as running in the JP Morgan Chase Race and sponsoring an employee softball team. We have been named by the National Association for Business Resources — an association of small and medium-sized businesses in Warren, Mich. — as one of the best places to work in the Chicago area for the last four years running.

What's the biggest challenge of owning your own business?

Small businesses notoriously have a hard time attracting qualified employees. And we’re no exception.

What's the biggest hurdle you've overcome?

My first business partner was not a very good fit for a start-up. He was a very bright and an experienced chief financial officer, but he had no industry experience. Making matters worse, he wasn’t very entrepreneurial, either. It became a toxic situation and the partnership collapsed in less than a year. Fortunately, as majority owner, I was able to maintain control of the company, and I managed to line up a 30-year industry veteran to replace him immediately.

What's the biggest mistake you've made?

The biggest mistake I made was underestimating the cost — in money, time and mental anguish — of what I perceived to be a frivolous trademark lawsuit. My attorneys advised me that we were largely in the right and that they had very little case against us. After two years and more than $500,000 in legal fees, we settled our case well before it ever went to trial. Had I known how expensive (and time-consuming) the case would be in advance, I would have settled immediately.

What's the best business advice you can offer?

Focus on providing a quality service or product, rather than merely making money.

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