Remote working has become the norm for many of#nbsp;us#nbsp;not on#nbsp;the front lines, and what’s been notable is#nbsp;that this is#nbsp;also changing the mindset for a#nbsp;lot of#nbsp;organizations, which are now hiring from an#nbsp;increasingly global talent pool. Today, a#nbsp;startup called Deel#nbsp;— which provides payroll, compliance tools and other services to#nbsp;help businesses do#nbsp;that in#nbsp;a#nbsp;more seamless way#nbsp;— is#nbsp;announcing $#nbsp;30 million in#nbsp;new funding to#nbsp;double down on#nbsp;the opportunity.
"We want to#nbsp;give access to#nbsp;services that remote workforces have typically not had access to," said Alex Bouaziz, the CEO who co-founded the company with Shuo Wang (the CRO). "We want to#nbsp;be#nbsp;the platform for employees and contractors who are working abroad. We#nbsp;went to#nbsp;give them all the same level of#nbsp;care as#nbsp;employees working in#nbsp;the main office."
The Series B#nbsp;is#nbsp;being led by Spark Capital and comes closely on#nbsp;the heels of Deel raising $#nbsp;14 million in#nbsp;a#nbsp;Series A only a#nbsp;few months ago led by#nbsp;Andreessen Horowitz. Deel is#nbsp;an#nbsp;alum of#nbsp;Y#nbsp;Combinator and counts the incubator, along with Nat Friedman, Ryan Petersen, John Zimmer, William Hockey and Alexis Ohanian, among its other investors.
Deel has now raised some $#nbsp;48 million to#nbsp;date, and while Bouaziz said that the startup is#nbsp;not disclosing valuation, he#nbsp;did confirm that the number has grown three-fold since May.
That may sound like a#nbsp;very rapid (too rapid?) progression, but it#nbsp;speaks to#nbsp;the company’s momentum. Deel is#nbsp;now being used by#nbsp;more than 500 companies (adding over 100 since May) and covering thousands of#nbsp;employees across 140+ countries. And it#nbsp;also underscores the specific market area in#nbsp;which Deel is#nbsp;working and the demand for what it#nbsp;offers.
In#nbsp;the words of#nbsp;Spark’s general partner Yasmin Razavi, who led the investment for the firm after proactively reaching out to#nbsp;Bouaziz over Twitter to#nbsp;get acquainted, all of#nbsp;the buzz these days is#nbsp;about workforce productivity tools and cloud services to#nbsp;manage data securely and efficiently among newly distributed workers, but Deel is#nbsp;helping fix something even more fundamental to#nbsp;keep from putting the cart before the horse, so#nbsp;to#nbsp;speak, when it#nbsp;comes to#nbsp;employing people across borders, whether they are employees or#nbsp;contractors.
"Everyone keeps talking about tools like Slack, Notion and Zoom as#nbsp;enablers," she said, "but the reality is#nbsp;that if#nbsp;you can’t hire and pay people, there is#nbsp;no#nbsp;workforce."
The problem that Deel is#nbsp;solving is#nbsp;the fact that up#nbsp;to#nbsp;now it’s not been very easy to#nbsp;do#nbsp;this. Companies either have to#nbsp;set up#nbsp;or#nbsp;already have in#nbsp;place local entities, or#nbsp;work with local legal teams to#nbsp;get things right. Chances are that if#nbsp;you are scaling quickly, you may not have these in#nbsp;place already, and might not have the funds to#nbsp;set it#nbsp;up#nbsp;if you don’t. That, in#nbsp;turn, might keep an#nbsp;organization from making the leap to#nbsp;working with the person abroad, or#nbsp;at#nbsp;least limiting the scope of#nbsp;engagement between the worker and company as#nbsp;a#nbsp;result.
(Deel is priced on#nbsp;a#nbsp;per-seat basis starting at $#nbsp;35 per person per month, but that varies by#nbsp;volume, services used and whether the person is#nbsp;a#nbsp;contractor or#nbsp;employee, and so#nbsp;on.)
Deel today already provides various tools to#nbsp;employees and the organizations that they work for, such as#nbsp;payroll services, tax compliance information, assistance on#nbsp;building contracts, invoicing services and a#nbsp;range of#nbsp;insurance options covering health and other areas related to#nbsp;working life.
The range of#nbsp;services currently includes lots of#nbsp;localised options: the contract tools, for example, help organizations build contracts that comply with local labor laws; the payroll offers different options localised for the best way to#nbsp;pay people in#nbsp;specific markets; and Deel provides comparative scenarios for employers to#nbsp;figure out if#nbsp;it’s best to#nbsp;keep people on#nbsp;contracts or#nbsp;take them on#nbsp;full time.
Now the plan is#nbsp;to#nbsp;continue building out that stack with more services aimed at#nbsp;both the workers and their employers. That includes loans based on#nbsp;salary for workers, more insurance and benefits options and so#nbsp;on. Interestingly, the fact that Deel offers so#nbsp;many integrated services that include recurring payments means that its life cycle with customers (and within the bigger two-sided marketplace, with employees) extends beyond simply just onboarding workers.
Razavi, Bouaziz and Wang are themselves the products of#nbsp;the rapid workforce globalisation that Deel has identified and builds products to#nbsp;support. The two co-founders met as#nbsp;students at#nbsp;MIT, but Wang comes from China, and Bouaziz is#nbsp;from Paris with family also in#nbsp;Israel, while Razavi herself is#nbsp;from Canada.
All effectively converged in#nbsp;what had become the de#nbsp;facto center of#nbsp;the tech universe, San Francisco#nbsp;— but these days they are not at#nbsp;all in#nbsp;the same places. Razavi spoke to#nbsp;me#nbsp;from Toronto, where she was quarantining before returning to#nbsp;the U.S. after a#nbsp;necessary trip to#nbsp;Portugal. Bouaziz spoke to#nbsp;me#nbsp;from Israel, where he#nbsp;went to#nbsp;see his family at#nbsp;the very start of#nbsp;the pandemic and has remained ever since. Wang is#nbsp;still in#nbsp;San Francisco for the moment.
It’s anyone’s guess where the three will be#nbsp;a#nbsp;year from now, and the point of#nbsp;Deel is#nbsp;that the company’s tools remove that variable from the equation. If#nbsp;things continue the way they have for the last eight months, that variable#nbsp;— where are you working from? —#nbsp;is#nbsp;going to#nbsp;be#nbsp;an increasingly common one, but with the help of#nbsp;a#nbsp;service like Deel’s, not a#nbsp;deal-breaker when it#nbsp;comes to#nbsp;getting a#nbsp;job or#nbsp;hiring the right person for a#nbsp;role.
There are a#nbsp;number of#nbsp;other companies out there that are disrupting the very incumbent world of#nbsp;payroll services, including the likes of#nbsp;Gusto and Rippling. The interesting thing with Deel is#nbsp;how it#nbsp;has focused squarely on#nbsp;the opportunity of#nbsp;providing services for people who are working across national borders. If#nbsp;that does become more commonplace, it’s likely to#nbsp;see significantly more competition, but for now, it’s a#nbsp;huge opportunity that’s only just opening up.
Published by TechCrunch#nbsp;— on#nbsp;September 9, 2020