The HR payroll market across the world is expected to record a compound annual growth rate (CAGR) of 9.2%, reaching a $14.31 billion valuation by the close of this decade, buoyed by the increased demand for payroll and other HR solutions.
In emerging markets, the growing awareness of HR payroll tech solutions, and a spiking number of small and medium-sized businesses is expected to drive the uptake of these solutions, as more companies go online to streamline their operations. It is this market opportunity that HR payroll startups like Workpay are looking to tap.
The Kenyan HR payroll startup will soon roll out its services in 40 countries in Africa, nearly double its current reach, following $2.7 million pre-Series A funding raised from Launch Africa, Saviu Ventures, Acadian Ventures, Proparco, Fondation Botnar, Kara Ventures, Axian, P1 Ventures and Norrsken. The YC-backed startup (W20) previously raised $2.1 million seed funding in 2020.
Workpay’s co-founder and CEO, Paul Kimani, told TechCrunch that they are set to launch a payroll engine that can serve customers in additional markets in a bid to stay ahead of their customers’ needs. He added that the startup will also release an API to enable, for instance, accounting firms to be payroll providers.
Kimani, who co-founded Workpay with Jackson Kungu (COO), sees a big opportunity for market leadership in Africa, having built the tech and non-tech infrastructure to enable it to scale.
“On the tech side, we have integrated with nearly everyone who is processing payments to allow us to send money to as many countries in Africa as possible. Non-tech means we have established a presence in these countries, and have partners that allow us to be compliant, which is very important,” he said.
An employee-side app enables workers to receive and view their pay slips, make expense requests, and apply for leave days. Image Credits: Workpay
Launched in 2019, Workpay offers tools that enable its clients to pay salaries in local currencies across Africa (and outside the continent through the startup’s partners), file taxes and process employee benefits. Using its tools, employers are able to also track and manage employees’ time and attendance, and leave days.
“We are a full-stack HR Payroll company, and we help employees to manage their people and pay them. And ours is a very neat platform that processes payrolls, and helps employers to be compliant," said Kimani.
"As an employer you are able to pay employees wherever they are, and in their preferred accounts -- they don’t have to be forced to open accounts with specific banks just because the employer banks there -- and file taxes too,” he said.
An employee-side app enables workers to receive and view their pay slips, make expense requests and apply for leave days.
Workpay is also adding financial services on top of its HR and payroll platform including linkages to investment accounts, medical and asset insurance and earned-wage access for employees attending to emergencies or bills.
“We are building a marketplace, and bringing in other players that can serve employers and employees on our platform,” said Kimani.
Kimani says Workpay has experienced great growth in revenue and clientele, with a spurt noted after the COVID slowdown of 2020.
“Since 2021 we have been doubling revenue every year, and the number of our customers -- who are nearing 700 as we speak. We also have about $200 million in total payroll value that we are handling for our customers annually,” he said.
Thomas Otter, general partner at Acadian Ventures, said in a statement: “Workpay is building a top-notch product, meeting the specific needs for HR and payroll in Sub-Saharan Africa. The addressable market in the region is growing rapidly and HR and payroll systems provide the foundation for fair and accurate pay. When combined with advances in mobile payments, solutions like Workpay can have a positive impact on businesses and society.”