Eynat Guez, Co-founder and CEO of global payroll management startup Papaya Global, discusses the latest trends.
2020 will forever be remembered as the year when terms like ‘social distancing’ and ‘home working’ entered our collective lexicon. Overnight, countless companies were forced to adapt to a new way of working, principally by allowing employees to work from home. Other firms, realizing the office had become virtual, started looking beyond borders to source the best talent. A global workforce and payroll management platform, Papaya Global supported many such organizations during this tumultuous period. Indeed, the Israeli-based startup – which recently raised $100 million of funding last year – has never been so busy. So, what does the future hold for HR – and are globally distributed teams really the new normal?
Q: How did your career in HR and corporate relocation lead you to see the need for a global payroll solution? What were the challenges that you were encountering at the time that inspired you to found Papaya? And what were some of the limitations with the payroll products that you were using at the time?
A: Payroll departments all over the world have their own unique processes and systems. Some have more commonalities than others, but the need for a global payroll solution was obvious. Some products aren’t equipped to handle paying foreign contractors, not least because different countries have unique employment regulations and banking rules.
With some software, it’s also impossible to integrate with other programs related to, say, expenses. Others suffer from inadequate backup systems or have poor customization functionality. Through my experience in global workforce management, I began to formulate ideas for a platform that could enable payroll automation and a comprehensive workforce solution. Payroll has been a headache for global organizations for too long.
Q: How have the events of the past year, driven by the global pandemic, accelerated the digital transition and driven demand for Papaya Global’s services?
A: Demand for our cloud-based payroll and workforce management services has been surging. The pandemic forced companies to reassess and streamline their operations, with an emphasis on saving both time and money. Businesses that were unable to implement these efficiencies, and rework their corporate practices, were badly affected, with some even having to wind down operations. Managing an international team isn’t easy, but with Papaya Global we’ve created a platform and solution that eliminates most of the pain points in hiring and paying global employees.
Q: In particular, what are some of the challenges faced by remote teams working globally in terms of payroll?
A: Because each country has its own tax and labor regulations, not to mention its own currency, non-mandatory benefits etc, managing a global workforce entails real complexity. Data privacy is another element that must be taken into consideration – in Europe of course, that means GDPR. If the employer is based in a different time zone, there can also be difficulties in resolving problems – late payment, for example, or some other issue with a payslip. Processes need to be put in place for these events. That’s where our automated end-to-end system proves invaluable.
Q: In September, you raised $100M in a Series C funding round. Can you explain a little about the products you’re currently developing because of this round, and what’s next on Papaya’s roadmap?
A: The funding will go towards improving our offering and expanding our teams in New York, Austin, Texas, Kiev, and Israel. In fact, we just opened a beautiful new office in Herzliya earlier this year. Thanks to the Series C round, Papaya has achieved a $1 billion valuation, and we will be releasing several new tools soon – watch this space!
Q: One of the biggest challenges’ organizations face when introducing new software is migrating their existing solutions over and training staff. Companies can encounter SaaS fatigue, with so many solutions competing for their attention. How does Papaya streamline the onboarding process and minimize setup and integration costs?
A: One of the great things about our cloud-based system is that it works with employers’ existing HRIS, ERP, Expense Management, and Time and Attendance systems. The onboarding process is designed to be intuitive, and to get new employees working in the shortest possible time. As far as setup and integration costs, there are no hidden costs or expensive licensing fees.
As a global company itself, Papaya is well placed to understand the opportunities and challenges presented by having a distributed workforce. Can you comment on how the company has grown under your leadership, and some of the lessons you’ve learned about effectively managing a global team?
A: I’d like to take all the credit, but we have a great team and tremendous backing from some supportive partners and repeat investors. It’s amazing to think that three-quarters of our funding has been raised in the past six months – I guess it goes to show just how much demand there is for an all-in-one payroll solution that supports all global employment models
Managing a global team is always a challenge but it’s enormously rewarding. Naturally, great communication skills are a prerequisite, as is the ability to tap into and take onboard different perspectives in terms of strategy. I think it’s also important to create a team ethic, to establish a sense of connection and unity between team members-based thousands of miles away.
Taking a macro view of the global economy and working patterns, do you think remote work and small, distributed teams will remain the norm, or do you think things will revert to how they were previously, with large corporate offices and global hubs?
A: Even pre-pandemic, many organizations were open to, or actively implementing, a lightweight model to reduce overheads. So, allowing employees to work from home if they desired and tapping into a bigger talent pool by widening the recruitment net. Other companies were sceptical but largely forced into action due to events beyond their control. It’s hard to say what the new normal will be; it largely depends on how employers, as well as employees, have found the last year.
Was it more productive or less? Some surveys show that a high percentage of employees don’t want to return to the office: they prefer the freedom of working from home, and the ability to spend more time with their family. Others, though, prefer the camaraderie of the office or would like a balance. It’s a question of company culture, too. Recently the chief exec of Goldman Sachs said he wanted to get bankers back behind their desks ASAP, calling home-working an “aberration” that must be corrected. Over 90% of Goldman Sachs employees have worked from home during the crisis, but David Solomon says the company’s “collaborative apprenticeship culture” necessitates the office environment. So, it really depends.