Further changes in employee needs and workforce structures will only increase the need for more automated and comprehensive global payroll solutions.
The trend of remote working and the booming global workforce have made it possible for companies to find the best talents around the world. However, the accompanying complex payroll management challenges have also caused headaches for global enterprises. Fortunately, Papaya Global has emerged to provide businesses with an innovative global payroll solution.
Papaya Global provides an end-to-end platform, from employee onboarding and ongoing management to global payments and payroll. It helps companies comply with labor laws in the jurisdictions in which they operate, provides employment benefits administration, and ensures data privacy in compliance with Data Protection Regulations (GDPR).
01 Overcoming geographical barriers, Papaya rises
Papaya Global was founded in 2016 by Eynat Guez (CEO), Ruben Drong (CIO) and Ofer Herman (CTO). Guez began his career as a holding company for large African infrastructure projects before founding a company in China focused on global mobility and employment. She deeply understands the pain points of global workforce management and is determined to create more intelligent and integrated payroll solutions.
Papaya Global’s platform not only supports employee onboarding and ongoing management, but also provides global payments and payroll capabilities. By integrating with software such as human resources information systems (HRIS), companies can import existing data into the Papaya platform to automate processes. Its alert system also ensures that companies comply with local labor and wage regulations, providing an efficient and convenient solution for companies' global workforce management.
02 One-stop global payroll solution platform
Papaya Global’s platform supports the entire global workforce process , from recruiting and onboarding to paying employees. It allows HR and finance teams to use the same set of tools through its payroll operating system. Companies can connect human resources information (HRIS) software with Payroll OS to transfer data from existing HR systems to Papaya's platform. Users can then create processes based on HRIS data and integrate them with payments, benefits and other deductibles.
When it comes to payment options, Papaya also offers convenience. Papaya provides global payroll and remittance services across more than 160 countries and major currencies, leveraging a banking track powered by JPMorgan Chase and Citibank, as well as a network of remittance licenses. Instead of managing multiple local bank accounts, companies can simply fund a virtual payroll bank account using 12 major global currencies and pay in any supported local currency, reducing the complexity and cost of cross-border payments.
Source: Papaya Global
In addition, the compliance contract management tools provided by the Papaya Global platform help companies create and maintain contracts that comply with local regulations to ensure the legal compliance of employment relationships.
Data is the core competitiveness of enterprises in the future, and Papaya provides powerful data intelligence and analysis tools.
Papaya consolidates global workforce data, allowing businesses to view global employment spend across payroll partners, nominee employers and contractors in a single view. With analytics dashboards, businesses can gain broader insights into things like fair pay, gender distribution and employee attrition, forecast billing and deposits, and use built-in contract lifecycle management tools for all levels of employees. In addition, Papaya Global is compatible with software such as Power BI, providing data teams with deeper insights and helping enterprises make smarter decisions.
Source: Papaya Global
03 Market with huge potential
The global payroll software market is expected to reach US$46.6 billion by 2028, indicating that global enterprises continue to grow in demand for payroll management solutions. At the same time, the global nominal employer market size is expected to increase from US$4.2 billion in 2021 to US$6.8 billion in 2028, indicating the increasing demand for cross-border employment by companies. In addition, the global human resources technology market is expected to grow to US$39.9 billion by 2029, which also reflects the desire of enterprises for more intelligent and efficient human resources management tools.
Source: Vantage Market Research
Papaya Global's target customer base includes companies of all sizes planning to hire contractors and full-time workers in foreign markets.
Previously, many companies faced tedious manual operations when conducting global payroll management, such as sending emails to employee representatives in different countries/regions, causing the payroll process to consume a lot of time and resources. However, with Papaya Global's software and built-in integrations, customers can complete most tasks and calculations with just a few clicks, greatly increasing the efficiency of payroll management.
Additionally, companies seeking to recruit internationally may have previously been required to register a legal entity in each new country, resulting in a costly and time-consuming solution. Papaya Global's services provide companies with more flexible, low-cost global recruitment and employment solutions. As of June 2023, Papaya Global serves more than 1,000 customers, including Microsoft, Toyota, Canva, Shopfiy, Vimeo and Wix.
04 The road to competition with industry rivals
The global payroll market is a highly competitive space that encompasses a wide range of players, including traditional enterprises and emerging software-centric start-ups. We can see some of the following opponents:
1. Deel is a global payroll platform similar to Papaya Global, providing simplified human resources workflow and solutions for multiple employment methods. Deel has entities in every nominal employer market and works directly with clients, unlike Papaya Global which has an outsourced partnership model. However, Deel does not offer in-house banking and payment systems.
2. Remote provides international payroll, benefits and compliance services and has its own global entity to provide clients with more control. As they build their global infrastructure, they provide clients with more comprehensive solutions covering payroll, tax and compliance for contractors and full-time employees.
3. Rippling provides an integrated platform that integrates employee data from human resources, IT and financial products. They recently launched a global recruiting solution that allows clients to recruit, pay and manage employees globally.
4. Gusto mainly provides payroll, benefits, human resources and integration services for small and medium-sized enterprises in the United States. They recently announced the launch of a US payroll service to compete with Deel in the US market.
5. Oyster is a global end-to-end platform providing HR, payroll, employment and recruitment solutions. Their platform targets large multinational companies looking for end-to-end HR solutions.
In addition to the opponents listed above, there are also some traditional companies such as Globalization Partners , which help companies recruit employees around the world through the nominal employer model.
05 Rapid financial growth
Papaya Global makes money by charging subscription fees for its solutions. Clients pay rates of $650/employee for nominal employer services, $2/month for contractors, and $190/month for global professional services. Using the price calculator on the Papaya Global website, customers can estimate the total annual cost based on the country in which they are registered, the number of employees and the services they use.
Source: Papaya Global
In terms of financial growth, in November 2021, Papaya stated that its ARR was US$90 million, and its revenue has increased by more than 300% year-on-year in the past three years. As of June 2023, Papaya works with more than 1,000 companies and manages approximately $3 billion in global payroll. Good financial growth has also caused the company's valuation to skyrocket. In September 2021, Insight Partners led Papaya's US$250 million Series D financing, with a valuation of US$3.7 billion, a 10-fold increase in one year.
06 Challenge traditional human resources service providers
The COVID-19 pandemic has accelerated the trend toward remoteness in how companies build their workforces, and companies are bound to adopt new solutions to manage their workforces. More and more developed economies are considering outsourcing services to emerging countries such as Argentina, Philippines and India. Further changes in employee needs and workforce structures will only increase the need for more automated and comprehensive global payroll solutions.
If Papaya Global can expand its products and country offerings, it could benefit significantly from future global employment trends. At the same time, Papaya also plans to connect with popular human capital management and enterprise resource planning software for deeper integration, hoping that more multinational companies will use Papaya.
Although Papaya still faces challenges from competitor innovation, whether remote working is sustainable, and local compliance risks. But it is undeniable that it also poses a challenge to traditional human resources solution companies such as ADP. If it can navigate the changing workforce landscape, Papaya still has a chance to maintain its pace of growth in an increasingly competitive market.
About the Author
Zheng Bo, Aka Harbor Habo. Cui Niuhui is a well-known butter, a middle-aged 2B infrastructure entrepreneurial veteran, and the founder of the CnosDB cloud native time series database open source community.
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