Salsa dips into $10M to fire up payroll features for software companies
Reading Time: 3 minutesCreating your own payroll tool can be expensive and take years to accomplish. Salsa thinks it should be quick and easy for software companies to embed and launch payroll features.
The company secured $10 million in funding to do just that: provide APIs for developers to add revenue-generating payroll solutions inside their own software products for an all-in-one platform. It also handles all of the compliance, calculations, tax filing and money movement.
‘They all really hate running payroll,’ CEO Kramer said. ‘It’s also the last piece that hasn’t gotten better over time. The landscape of legacy payroll tools is that they are hard to use. We have made it simple for developers to put it in their own products.’
Embedded payroll is not a new concept — Kramer considers companies like Gusto and Check to be competitors of Salsa, and said that some of the products launched prior to Salsa ‘have taken quarters, or even years, to go live,’ meaning that many of the early adopters are still waiting and others have had to hire a team of people to manage the new payroll product. Instead, Salsa is able to shorten that to about a month, and without the engineering complexity.
And just how did the pair come up with their company name? Kramer and Barroso went looking for ‘a great name that would convince payroll people to join in,’ Kramer said.
‘We like to eat as much spicy food as possible, and our goal is to spice up software platforms,’ he added. ‘Payroll is a complicated dance we are making easier. One of the things we learned when we go on company outings to make Salsa, is that there are so many different recipes for making it, that whatever your recipe is, is the right one.’
Currently, Salsa is available in both the U.S. and Canada, targeting business management software platforms, neobanks, staffing agencies and workforce management companies. In return, the company takes a share of the revenue software companies earn from the payroll product to fulfill the operational side of running payroll.
Kramer wasn’t ready to divulge Salsa’s customer count just yet, but did say that the company was doubling the number of customers every quarter and expects to continue for the rest of the year. The company ended the first quarter of 2023 with 100% revenue growth over the fourth quarter of 2022. He expects to end 2023 with 400% revenue growth over 2022.
‘We’re just getting started but we’re very happy with our traction so far,’ Kramer said. ‘We’re currently working through a large pipeline of partners who want to go live in the next quarter and recently celebrated the one-year anniversary of our first partner going live.’
Salsa’s funding round was led by Greycroft, Better Tomorrow Ventures and Definition. They were joined by Cambrian’s Rex Salisbury, Forum Ventures and a group of individual investors, including HoneyBook CEO Oz Alon, AngelList CEO Avlok Kohli, inDinero co-founder Jess Mah, Coast CEO Daniel Simon, Searchlight CEO Kerry Wang, DocSend co-founder Russ Heddleston, Human Interest co-founder Roger Lee, Kanmon CEO Mengxi Lu, and Shyft CEO Alex Alpert. The funding will be used on product development and additional hires.
Investors are happy, too. Will Szczerbiak, partner at Greycroft, said in a written statement that Salsa is ‘redefining the way companies can do business.’
‘Salsa has identified and addressed a major gap in the fintech industry by creating a smart and efficient method to integrate payroll into the platforms businesses are already using,’ Szczerbiak said. ‘John and his team have taken a novel approach to the problem of making payroll better, and they’ve designed a way to make it easier to build for customers across multiple sectors.’
Reference: https://techcrunch.com/2023/05/10/salsa-fintech-10m-payroll-software/
Ref: techcrunch
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