Personal blog of Yzmir Ramirez

The pandemic has been a time for a lot of reflection on both a personal and business level. Tech companies in particular are assessing whether they will ever again return to a full time, in-office approach. Some are considering a hybrid approach and some may not go back to a building at all. Amidst all this, Dropbox has decided to reimagine the office with a new concept they are introducing this week called Dropbox Studios.

Dropbox CEO and co-founder Drew Houston sees the pandemic as a forcing event, one that pushes companies to rethink work through a distributed lens. He doesn’t think that many businesses will simply go back to the old way of working. As a result, he wanted his company to rethink the office design with one that did away with cube farms with workers spread across a landscape of cubicles. Instead, he wants to create a new approach that takes into account that people don’t necessarily need a permanent space in the building.

“We’re soft launching or opening our Dropbox Studios [this] week in the U.S., including the one in San Francisco. And we took the opportunity as part of our focus to reimagine the office into a collaborative space that we call a studio,” Houston told me.

Houston says that the company really wanted to think about how to incorporate the best of working at home with the best of working at the office collaborating with colleagues. “We focused on having really great curated in-person experiences, some of which we coordinate at the company level and then some of which you can go into our studios, which have been refitted to support more collaboration,” he said.

To that end, they have created a lot of soft spaces with a coffee shop to create a casual feel, conference rooms for teams to have what Houston called “on-site off-sites” and classrooms for organized group learning. The idea is to create purpose-built spaces for what would work best in an office environment and what people have been missing from in-person interactions since they were forced to work at home by the pandemic, while letting people accomplish more individual work at home.

The company is planning on dedicated studios in major cities like San Francisco, Seattle, Tokyo and Tel Aviv with smaller on demand spaces operated by partners like WeWork in other locations.

As Houston said when he appeared at TechCrunch Disrupt last year, his company sees this as an opportunity to be on the forefront of distributed work and act as an example and a guide to help other companies as they undertake similar journeys.

“When you think more broadly about the effects of the shift to distributed work, it will be felt well beyond when we go back to the office. So we’ve gone through a one-way door. This is maybe one of the biggest changes to knowledge work since that term was invented in 1959,” Houston said last year.

He recognizes that they have to evaluate how this is going to work and iterate on the design as needed, just as the company iterates on its products and they will be evaluating the new spaces and the impact on collaborative work and making adjustments when needed. To help others, Dropbox is releasing an open source project plan called the Virtual First Toolkit.

The company is going all in with this approach and will be subletting much of its existing office space as it moves to this new way of working and its space requirements change dramatically. It’s a bold step, but one that Houston believes his company is uniquely positioned to undertake, and he wants Dropbox to be an example to others on how to reinvent the way we work.

Remote working — hiring people further afield and letting people work outside of a central physical office — is looking like it will be here to stay, and today one of the startups building tools for that environment is announcing a big fundraise in response to the opportunity.

Papaya Global, an Israeli startup that provides cloud-based payroll and hiring, onboarding and compliance services across 140 countries for organizations that employ full-time, part-time and contract workers outside of their home country, has picked up $100 million in funding and has confirmed that its valuation is now over $1 billion.

The company targets organizations that not only have global workforces, but are expanding their employee bases quickly. They include fast-growing startups like OneTrust, nCino and Hopin (which today announced a monster $400 million round), as well as major corporates like Toyota, Microsoft, Wix and General Dynamics.

Papaya is not disclosing revenue numbers but said that sales have grown 300% year-over-year for each of the last three years.

Led by Greenoaks Capital Partners, this Series C also includes significant participation from IVP Ventures and Alkeon Capital. Previous backers Insight Venture Partners, Scale Venture Partners, Bessemer Venture Partners, Dynamic Loop, New Era and Workday Ventures, Access Ventures and Group 11 also chipped in. The new investment brings Papaya’s total funding to $190 million.

Papaya has been on a fundraising tear in the last 18 months. Today’s news comes less than six months after it raised a $40 million Series B. And that round came less than a year after a $45 million Series A.

Why so much, so quickly? Partly because of the demands on the business, but possibly also to capitalize on an opportunity at a time when so many others are also going after it as well.

The opportunity is that companies and other organizations are finding themselves needing tools to address the current state of play: Workforce growth today doesn’t look like it did in 2019, and so incumbent solutions like ADP, or cobbled together solutions covering multiple geographies, either don’t cut it, or are too costly to maintain.

Papaya Global, in contrast, says it has built an AI-based platform that automates a lot of work and removes much of the manual activity that comes out of trying to right-size a lot of legacy payroll products to work in new paradigms.

“The major impact of COVID-19 for us has been changing attitudes,” CEO Eynat Guez, who co-founded the company with Ruben Drong and Ofer Herman, told me in an interview last September. “People usually think that payroll works by itself, but it’s one of the more complex parts of the organization, covering major areas like labor, accounting, tax. Eight months ago, a lot of clients thought, it just happens. But now they realize they didn’t have control of the data, some don’t even have a handle on who is being paid.”

One challenge, however, is that many others are also chasing these customers in hopes of becoming the ADP of distributed and global work.

Last month, a startup called Oyster, also aimed at distributed workforces, raised $20 million. Others in the same area that have raised lots of capital include Turing,  Deel, Remote, Hibob, Personio, Factorial, Lattice, Turing and Rippling.

And as we have pointed out before, these are just some of the HR startups that have raised money in the last year. There are many, many more.

Investors here are hoping that as we see some consolidation emerge out of this mix, there will be a few leaders and that Papaya will be one of them.

“Papaya Global has built a best in class solution to onboard new employees, automate payroll, and manage a global workforce through a single pane of glass. Both growing and established companies have dramatically changed their working practices in recent years, and Papaya has seen impressive growth as a result. We’re excited to continue supporting them as they seek to simplify an increasingly complex challenge for some of the world’s biggest companies,” said Patrick Backhouse, partner at Greenoaks Capital, in a statement.

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