Paris-based startup PayFit, which aims to digitise HR and payroll processes for SMEs, has raised a €90m Series D round and announced plans to raise its headcount by 50% across 2021.

The investment comes from several big names in the French funding scene, including Eurazeo Growth, Large Venture, BPI France and French billionaire Xavier Niel. PayFit, launched in 2016, raised a €70m Series C round in 2019.

The company saw 40% growth across 2020 and is now used by 5k small and medium sized businesses (SMEs) across five countries in Europe — Spain, France, Italy, the UK and Germany. 

Current customers include fintechs Revolut and Starling Bank, and wellness app Treatwell.

Europe has 24m SMEs, which together make up 99.8% of the continent’s businesses. PayFit hopes to help them by centralising payroll, tax submissions, absences, holidays and expense reports into one place. The platform also helps companies analyse gender pay gaps. 

Accelerated digitisation

The transition to remote work has made HR processes more difficult, hence the industry’s accelerated adoption of digitised processes, PayFit’s CEO and cofounder, Firmin Zocchetto, says.

“They have had to deal with various issues: from supporting the company’s management with the implementation of remote work policies to ensuring employee wellbeing through new initiatives.”   

The SaaS SME surge

PayFit’s raise comes amid a surge in SaaS companies providing solutions for small businesses. There’s HR software startup Personio, based in Germany, which has seen 140% growth in employee numbers across the last year. 

Similarly, French startup Pigment, a planning and reporting SaaS solution for SMEs, and Easol, which provides solutions for small travel businesses, were both listed in our investor survey of SaaS startups to watch this year.

Growth

PayFit, which currently employs 550 people, plans to increase its headcount by 50% across 2021 and reach 1k employees by the end of 2022. 

The company says it will develop new features, including integrating weekly meetings and staff feedback into the platform. 

“There are still tens of millions of SMEs that want to go digital. The market is huge, and our ambition remains the same: to become the point of reference for payroll and HR management for all SMEs.”

Freya Pratty is Sifted’s news reporter. She tweets from @FPratty