"I think the most reasonable approach is for a hybrid solution."
Eynat Guez is the co-founder and CEO of Papaya Global, a global payroll and workforce management company that is using technology to reinvent how people are paid across the globe. In 2021, she earned the distinction of being the first woman in Israel to lead a company to an evaluation of over one billion dollars – no small feat one of the world’s biggest centers for hi-tech innovation.
We spoke with Eynat about why she chose to focus on global payroll, how the world of work is changing and what it means for companies around the world, and some of the lessons she learned as a woman in a male-dominated industry like hi-tech. She even had some great advice for how companies should prepare for the emerging recession.
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Table of Contents
What made you decide to start a company like Papaya Global?
Eynat Guez: My career has always been in the intersection between HR, workforce management, and technology. I saw first-hand how deep the technology gap was in the field of payroll. That was the impetus for my two co-founders and me to launch Papaya Global.
We wanted to automate global payroll and provide a technological solution to global compliance, addressing some of biggest challenges companies faced paying their global workforce.
From the start, the platform would support all types of employment, whether that’s direct payroll, an employer of record solution, or an independent contractor. It brings all the data together into a single panel, provides control and visibility of global spending, and ensures compliance in every country.
I’m proud to say that in the 6 years since our founding, we’ve helped more than a thousand companies achieve their expansion goals.
Has the role of payroll changed at all in recent years?
Eynat Guez: Payroll has always been the something of a neglected stepchild in most companies. If people receive their salaries accurately and on time, no one pays any attention. But with so many companies hiring globally, it’s becoming clear that a global payroll far more complicated than a local payroll.
The manual process companies have used for years needs to be replaced. That’s where Papaya Global comes in. We provide technology to automate the payroll process from end-to-end.
This shift – from manual to automated – is transforming payroll in ways that people are only starting to recognize. For the first time, payroll can be used as a strategic tool, not just a tactical measure to meet an immediate need.
When all the payroll from all the different locations is consolidated into a single platform, it produces a wealth of business analytics that provide unprecedented insights on global spending, predicting future spending, and even talent retention. It’s only a matter of time before people see payroll data as essential to business operations.
Why has payroll grown so complicated?
Eynat Guez: Before the pandemic, at least 40% of the global workforce was working remotely or as part of a distributed team that might stretch over numerous countries. Originally, that was the result of the gig economy and the rise of the digital nomad. The numbers are surely higher today.
Governments across the world have been trying to catch up with the changes, both to protect workers from exploitation and to collect all the taxes due to them. So, there are more laws and more complex tax structures. And it’s only moving in the direction of greater oversight and more complexity.
But even without the added layers of new laws, just running a payroll in multiple countries is hard enough. Every country has its own laws and tax rates. They operate in different languages and use different currencies.
There are no standards for reporting, so you might be in one country, getting reports on hours in Excel, or in Word, or in a PDF – something different for each employee – and then handle expense receipts in different languages. And there is much more. The complexity is many times greater than for a single country payroll.
How did the COVID-19 pandemic impact Papaya Global?
Eynat Guez: The pandemic arrived just as Papaya Global was entering a period of hyper-growth. That turned out to be a challenge and a blessing for us. The challenge was learning how to hire and onboard and integrate many new employees across many different countries, all remotely.
The blessing, of course, was that we saw first-hand what other companies need to succeed. It turned out to be a tremendous period of growth, both in our size and in our expertise.
Even before the pandemic, we had implemented a set of values that we felt expressed the DNA of Papaya Global. These include an emphasis on diversity in all its forms and a belief that all policies must apply to everyone equally, no matter where they are based or their level of seniority.
So, when people joined the company, they knew what we stand for and it helped them connect, even if they were in a different time zone.
How do you see the future of remote work? We hear employees threaten to quit their jobs if they can’t work remotely. At the same time, influential business leaders like Alon Musk want people in the office for 40 hours a week.
Eynat Guez: I think the most reasonable approach is for a hybrid solution. Currently at Papaya Global, we ask people to work in the office for three days a week and the other days can be from anywhere.
For me, that’s really the best of both worlds. People have substantial face-to-face interaction with their colleagues over three days. Meetings are much more effective in person. People feel more connected to their work and to the company when they interact directly. But there is still a lot of room for flexibility on the other days.
When we hired people in clusters around a single region, one of the first things they would ask for as a means of support was for us to open an office for them. They also value the hybrid model of remote work. They want to spend time with their co-workers. For an employer, remote work is a test of trust in their employees.
But I say that if you can’t trust the people you hire, then you have a deeper problem than deciding where your teams should be working.
Most financial analysts are expecting an imminent economic downturn. Do you have any advice for CEOs to prepare for a possible recession?
Eynat Guez: There are a lot of companies that have employees in several different countries, and they use a different payroll provider in each country.
In those cases, the company won’t know how much it’s spending on global payroll, or even their global headcount because all the systems are disconnected and it’s an elaborate manual process to get that information. And if they don’t know what they are spending, they certainly don’t have any idea if it’s too much, too little, or just right.
So, my biggest piece of advice for companies with a global footprint is to centralize their payroll operations so that they can see their total costs, and their costs per country.
The cost per employee will vary widely from country to country because of tax rates and labor laws. Some bring more ROI than others. If efficiency is essential, visibility into spending is the first step.
As a woman, mother, and CEO of a unicorn valued at $3.7 billion, what are some of the lessons you have learned that might help other women beginning their careers?
Eynat Guez: First and foremost, being a woman is not a disadvantage. It has never held me back from my goals. That’s not to say that society has reached a point where gender is no longer a factor. Obviously, we have a very long way to go. There are still enormous gaps in salaries for me and women, and there are challenges women face that men might not ever realize. I remember when I was holding meetings for our B round of funding.
I was far along in my pregnancy with my second child, and when I would enter the meeting room, I could just feel all the air drain out. It was discouraging but I wasn’t going to let it stop me from getting the funding I needed, and in the end, we closed a successful B round. I was pregnant again during negotiations for the C round, and we closed that round at $100 million two weeks after I gave birth to my third child.
That said, I also think it’s important to note that the idea of “having it all” is a false idea that causes too many successful women to diminish their accomplishments. I do what I can in all my roles, and I accept that I’m not going to have it all, and that’s OK with me. I have a wonderful family and a growing company. To me, it’s all part of a same continuum. My company needs me like my kids need me.
How can readers stay up to date on your work and industry thoughts?
Eynat Guez: I often post on our company blog, and also on my LinkedIn profile.
Jerome Knyszewski, VIP Contributor to ValiantCEO and the host of this interview would like to thank Eynat Guez for taking the time to do this interview and share her knowledge and experience with our readers.
If you would like to get in touch with Eynat Guez or her company, you can do it through her – Linkedin Page
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