French startup Payfit wants to modernize the good old paychecks in France. After just a few months, the company just raised $5.6 million (€5 million) from Otium Venture and Xavier Niel.
Payfit officially started in April 2016. And it looks like many companies were waiting for a product like this one given today’s funding round. Geoffroy Roux de Bézieux, Jean-Daniel Guyot, Oleg Tscheltzoff and TheFamily also invested in this round.
“Right now in France, you need to have dedicated people working exclusively on payroll functions. And if you outsource them, you lose control,” co-founder and CEO Firmin Zocchetto told me.
Payroll departments use outdated software with expensive licenses. Payfit is a software-as-a-service, meaning that everything happens in your browser, it always gets updated and you pay every month depending on the size of your company.
This alone is a big change in France as there aren’t many solutions to manage paychecks. That’s why it can get really expensive, even for a tiny company, to pay your employees.
Zocchetto walked me through the product and I was quite impressed with the interface and general philosophy. Even though I’m no HR manager, I could see myself using something like Payfit to manage contracts, salaries, vacations, tickets restaurant meals and more.
On the other end of the equation, employees can log into Payfit to download paychecks and request a vacation. And if there’s an issue, you know that you can directly talk to someone in your company about it as your company doesn’t rely on an outsourced payroll service bureau.
So far, 250 companies have signed up to Payfit, such as Heetch, Sellsy, Nestor or Aircall. They pay €39 per month and €11 per month per employee — traditional competitors tend to be more expensive than that.
The product is only available in France as this type of product tends to be very specific to one market. But Firmin told me that the startup could eventually expand to other European countries.
Payfit looks like a simple idea on paper, but it’s such an unsexy industry that there hasn’t been a lot of competition. Moreover, every company needs to manage their payroll — Payfit isn’t just something that is “nice to have.” And you don’t have to keep up with the ever-changing French law because Payfit handles it for you — this is also a good selling point.