HR is a necessary part of running every single business in the world. But the processes and technology that underpin it are some of the least sexy and most convoluted in the world. However, the industry is large and lucrative, and therefore ripe for innovation. The HR management market is expected to be worth $30bn by 2025, with growth fuelled by the entrepreneurs heaping legacy systems onto the bonfire and making it easier for companies to hire the best people, and keep them. And the rise of cloud computing and software-as-a-service (SaaS) is changing this market forever. I caught up with a founder at the heart of it.
Firmin Zocchetto is CEO of PayFit, a French company he founded at just 22. Already serial entrepreneur, he had no experience of payroll himself, but set out to transform it anyway. He is now at the helm of a team that has grown from 20 to 200 in two years, works across multiple countries, and has raised €19.5m, including money from Accel Partners and French superinvestor Xavier Niel.
Philip Salter: What motivated you to set up PayFit?
Firmin Zocchetto: My two co-founders and I knew that payroll could be done in a far better way. It is one of the most complicated, disjointed processes out there, with different products being used to onboard, pay and manage employees. We wanted to make payroll great – particularly for SMEs. There were, and are, SaaS solutions for large companies; our aim was to touch thousands of smaller companies, and millions of employees.
I had already founded businesses with one of my co-founders at a pretty young age. And, actually, at 22, we were young to be starting PayFit! The idea we had was to invent an entirely new technology around payroll. So we built a programming language, JetLang, from scratch. Partly, because doing so was an intellectual challenge. But also because we started by asking the question: “what would make our would-be customers’ lives infinitely better?”
Salter: How does your product work?
Zocchetto: It’s actually pretty simple – we’re not trying to reinvent the wheel in terms of substance, but make the process of payroll far more straightforward, even enjoyable. Our product gives companies an end-to-end payroll solution: i.e. they can add employees, contracts, holidays, expenses, change a salary or add a bonus – do everything you associate with HR in one place. PayFit enables you to onboard a new employee with a name and address – there is no aggregation of emails and numerous excel documents to wade through.
Making life this easy for SMEs is so important, because it means they can get on with their core business. It also makes life better for the employee, too. If they want to book a holiday, file expenses – everything is in one place and done in a few clicks. PayFit also brings autonomy to processes that are often such a headache because poor tools have required multiple actors: booking holiday for one person means involving four, or someone checking through reams of payslips. We ensure those inefficiencies are firmly in the past.
Our language, JetLang, was tough to build. But it means that we can hire people with non-engineering backgrounds, train them, and they can then develop across the PayFit infrastructure. It also creates a borderless world for our customers: the software, and building on it, remains the same whether you are in the US or France, the UK or Australia. Sorting HR in new territories is a huge challenge for businesses – and one we remove.
Salter: What are your ambitions for the company?
Zocchetto: Our ambition is to serve millions of people. At the moment, it’s thousands and thousands, but we want to give SMEs across the world the ability to properly manage HR and employees. At the moment, we are 200 people. In three years’ time, we will be 700 and working with customers in many countries.
As a company, culture is very important to us. We have a great working environment with all the perks, but we place huge emphasis on the treatment of people – particularly at the point of hiring. That stems from the way we lead and manage the company, but it filters down into specific policies, like the fact our final interview stage includes a BBQ with current PayFitters. People are often expected to join companies without having really met any of the people they are going to spend hours with each day. Hosting an event helps solve that, and we find it makes a difference in hiring the right people – where they fit the business and vice versa.
We are also ambitious about building something in France. Building tech companies with thousands of employees and serving millions of customers is rare, if not unheard of. We’d like to change that.
Salter: What’s your biggest challenge as a business?
To grow as fast as possible while also keeping our culture intact. We are good at doing this, but you can’t get complacent. We have a great onboarding session when people arrive and a lot of team events, including regular all-in weekends. That’s really important. Sometimes people have the false impression that allowing employees to relax, to feel and be open, slows a business down. It doesn’t. We think it’s vital in maintaining a happy and consistent workforce.
Salter: What will SaaS and HR look like in 10 years’ time?
In 10 years’ time, SaaS will be the new software. The last decade has seen us move from perpetual licenses to subscription-based models. The shift we need to see now is to a truly service-centric paradigm, which will likely continue to be built around ad-based revenue models. This breed of SaaS won’t be the preserve of techies and early adopters, but the norm. We don’t think of Facebook as a SaaS company, but it does provide you with a service created from software – in exchange for your time and your data. More and more SaaS providers – and those selling to businesses as well as consumers – will start operating like this.
When it comes to HR, I really believe it will increasingly be the part of a business that focuses on making your employees happy, rather than merely a support function. So many companies place huge emphasis on hiring and people, but they don’t have the tools they need to make doing so as easy as possible. Rather than compulsory, HR should be seen as the thing that’s driving your business. And rightly so, because your business is the sum of the people within it.