Papaya Global: Why We Invested
Take this scenario familiar to startups and multinational enterprises alike: the VP of Engineering wants to hire a rockstar developer, who will work remotely from their home in, let’s say, Uruguay. An email gets sent and it’s up to HR to make it happen and Finance to get them paid.
Yet the request to hire even a single new employee in a new country is not a simple one. Every time a company enters a new geography, its HR and Finance departments assume new compliance and operational responsibilities. There are generally two routes available for them: develop the needed expertise in-house or pay a third-party payroll provider that covers the region. Either way it is a consequential decision because both paths add costs and complexity.
The trends driving increasingly multinational workforces aren’t going away. Companies large and small face some combination of pressures from three factors:
● Tight local labor markets, pushing companies to look farther and farther afield just to maintain access to quality candidates.
● Remote work patterns, where COVID simply accelerated technology-driven changes in employee preferences and employer requirements.
● Globalization itself, where growth opportunities often require boots on the ground in new regions. Figuring out how to hire and pay these employees is time consuming and expensive.
These forces have long been building and we expect they will remain relevant into the years ahead. Certainly for as long as the cost saving benefits of hiring quality employees abroad continues.
Highly manual, labor-intensive processes like we’re talking about here call out for technology solutions. Traditionally, however, this market has lacked such solutions. In payroll, for example, the status quo for even established enterprises is to cobble together salary, bonus, and commission data from multiple databases, then email that data to Finance or each country’s outsourced payroll provider. Repeat about 26 times per year.
Papaya Global is a New York- and Tel Aviv-based People & Payroll services technology company that enables businesses to pay all of their international workers using a single software platform, across more than 140 countries, and regardless of the employment status of the workers (e.g., direct employees, hired via a third-party Employer of Record (EOR), hired as a contractor).
The company was founded in 2016 by the trio of Eynat Guez (CEO), Ruben Drong (CPO), and Ofer Herman (CTO), each of whom bring decades of leadership experience to the table. Of particular importance, prior to co-founding Papaya, Eynat gained first-hand experience leading and growing a global employment and payroll outsourcing company. Papaya joins Scale’s roster of enterprise technology companies with strong presences in Israel, including JFrog,WalkMe, and Forter.
Papaya’s SaaS solution acts as an aggregation layer on top of third-party in-country partners (ICPs). This technology layer turns out to be a key to streamlining the management of a global workforce. Global employers of any size can aggregate payroll processing as well as related tasks like reporting, certification, and employee management. All via a single view of all employees in all regions. There’s a long history of success in SaaS from companies that manage to provide such a consolidated view of formerly disparate, non-digital processes, from DocuSign to Bill.com.
To put it another way, if you asked an enterprise human resources VP whether they would like to work with a dozen different ICPs by email and phone, or via a centralized technology platform with comprehensive monitoring and reporting capabilities, which would they choose? So far more than 150 enterprise customers have chosen Papaya, including both high-growth startups like nCino and OneTrust and multinationals like Microsoft and Toyota.
As a technology-forward solution for streamlining international payroll management, Papaya is well-positioned to establish leadership in this critical area. Scale is pleased to lead the company’s Series B round and we look forward to our work together with Eynat, Ruben, Ofer, and the entire Papaya Global team in the years ahead.
Scale’s Susan Liu contributed to this article.
Originally published September 30, 2020.