Papaya Global agrees to acquire payments firm Azimo

Global people management startup Papaya Global agreed to acquire cross-border payments firm Azimo in a deal worth $150-200 million, according to multiple reports.

Why it matters: Amid growing competition in the space, the deal gives Papaya Global a leg up in terms of its ability to do faster employee payments (regardless of geography) and lower costs by cutting out third-party payment providers.

• The deal will also help Papaya expand into other services.

Between the lines: Azimo runs a payment and remittance service that primarily competes against the likes of Wise (the former Transferwise).

• Its network is available in more than 160 countries; before the deal Papaya Global operated in 140 countries.
• While possibly opening up new geographies for Papaya Global, the deal also reduces the reliance on third-party payments providers for customers’ payroll.
• And that will lower costs and increase the speed with which client employees get paid.

The intrigue: The deal could also open up a new revenue line for Papaya Global, by enabling it to provide cross-border remittance or payments services to those employees themselves.

State of play: Papaya Global competes against a number of startups that help businesses manage remote workforces around the world, including Deel, which raised $425 million last October, and Remote, which raised $150 million in July 2021.

Flashback: Papaya Global raised $250 million at a $3.7 billion valuation from investors that included Insight Partners and Tiger Global last September. In total, it has raised $440 million.

• Azimo, meanwhile, had raised $88 million and was backed by investors like Rakuten and Greycroft.