Deel, a US unicorn that helps companies hire and pay remote contractors and employees in more than 150 markets globally, is launching in Hong Kong. Founded in 2019, the San Francisco-headquartered start-up provides a “tech-enabled self-service” platform that speeds up the employer of record service that certain companies have been providing over the past decade. Employers of record are firms that help businesses hire employees in countries where the employer does not have a local entity. As the legal employer, the employer of record ensures that employees are hired in compliance with local regulations and handles their payroll. “The potential and opportunities in Hong Kong are huge, even though it’s a small place,” said Shuo Wang, Deel’s co-founder. “A lot of the companies in Hong Kong are very global, and are open to hiring talent internationally.” Hong Kong’s luxury home rents may tank as Covid rules send expats packing Deel’s automated service is expected to help those companies in Hong Kong that have been directly hit by a brain drain that began in 2019 with the city’s political unrest and intensified during the coronavirus pandemic. What differentiates Deel from other traditional employers of record is that the start-up’s product streamlines the process end to end, Wang said. “We aim to achieve 95 per cent automation so that companies do not need to check payroll on spreadsheets,” she said. Covid-19: Hong Kong firms seek offshore talent to replace expats eyeing exits The start-up was founded through the Y combinator programme and has received funding from YC Continuity Fund, Spark Capital and Coatue Management. So far, it has raised a total of US$630 million. The latest addition to its list of investors in this quarter is Emerson Collective, whose investment philosophy fits with the social impact Deel wishes to make, Wang said. Although Deel did not confirm exactly how much the firm had raised recently, various media outlets reported earlier this month that the company had raised US$50 million this quarter and was now valued at US$12 billion. The company was previously valued at US$5.5 billion in October 2021. Deel is Wang’s second entrepreneurial venture, her first being a company in Beijing that designed and manufactured air purifiers, which was eventually acquired by iRobot. “The revolution that we’re trying to bring to Hong Kong [is] to make the HR function in companies more efficient, and to make data and payments more accurate. So that [companies] can scale faster and hire more efficiently, ” she added. Hong Kong property on sale as expatriates flee ‘ridiculous’ quarantine rules Employers can promptly pay employees and contractors in more than 120 currencies through Deel’s platform. According to the company, payments worth more than US$1.9 billion were made on its platform during the second quarter of 2022. Wang said the company saw the Asia-Pacific region as a very big market and planned to expand to Singapore next. Deel already has footholds in Japan and Australia. Deel reached US$100 million from US$1 in annual recurring revenue in just 20 months, Wang said. This is significantly shorter than the time it took Slack, the previous record holder for fastest growth, to reach this target. It took Slack three years to reach US$100 million in annual recurring revenue. Hong Kong Insurance Authority faces staff shortage amid Covid restrictions “The number 1 reason [for Deel reaching this target so fast] is favourable market conditions,” Wang said. Businesses have become very open to hiring internationally because of the pandemic, she added. The three-year-old start-up now has more than 7,000 customers across more than 150 markets. Some of its prominent customers include Coinbase, Shopify and Dropbox.