The global freelance market, a The $1.3 trillion industry was fueled of more than 200 million knowledge workers, is driving demand for solutions that automate payroll and streamline employment and tax regulations worldwide. However, most existing products fail to address the legal landscape of emerging markets, such as differences in employment law.
This oversight means that global recruiting platforms, which traditionally rely on third-party payroll providers, are often left to navigate the complexities of local employment laws themselves — creating a substandard experience for workers. Additionally, remote workers in these markets have their own problems, as they often have to wait up to a week to receive their paychecks and lose 5-7% in remittance fees. The treatment for these pain points is there Cadana coming: Starting in 2021, APIs and white-label products enable the global workforce to integrate payments and payroll management into their existing systems.
Cadana modernizes payroll for major talent marketplaces, staffing firms and HR providers, enabling them to pay workers in over 32 emerging markets including Brazil, Ghana, Nigeria, Pakistan and the UAE, making it easier for workers in these areas to have access to global work opportunities.
The company told TechCrunch that it has raised a total of $7.4 million in funding since its founding in January 2021. That includes $325,000 in pre-seed funding that same year and $7.1 million in funding, which closed this year. Costanoa Ventures led its most recent round, with Better Tomorrow Ventures and 500 Global participating.
“Our customers in emerging markets appreciate what we’ve built. When we started, workers often waited around seven days to receive their payments and missed remittances as well, which is significant given that many support an average of five family members,” co-founder and CEO Albert Owusu-Asare he told TechCrunch in an interview. “We focused on building a strong local infrastructure to address these issues. Over the past three years, we have integrated local payment, compliance and benefits systems to better serve our customers and meet their needs.”
The fintech’s main customer base spans the US and the UK, where it serves telecommuting businesses employing thousands, even tens of thousands, of workers. Many had previously struggled with ineffective vendors or in-house solution efforts, according to Owusu-Asare, who explained that Cadana provides a range of solutions tailored to the various problems these businesses face.
At the lowest level is the white label solution where businesses can add a logo and go live. The middle tier is for those who want to create custom components, such as UI components, with support from Cadana. Then at the highest level — aimed at customers who need specific solutions but don’t have the necessary infrastructure — Cadana provides APIs that cover payments, compliance, understanding local labor laws and fraud control, allowing its customers to build custom tools.
Owusu-Asare and Cadana’s other co-founder, Ameer Shujjah, who is also its CTO, are both immigrants to the US who met while in college as computer science and physics majors. After years of experience at Amazon, Esusu and Goldman Sachs, they founded Cadana — initially as an Earned Wage Access (EWA) platform in specific markets in Africa. But after the launch, on-demand payroll quickly took a back seat – becoming a hallmark of a wider game of providing global payroll software and services to businesses in emerging markets, as the pair spied a more significant opportunity to chase a series of payroll frictions.
“I am from Ghana and Ameer is from Pakistan. We understand very well what these workers’ needs and pain points are, and our focus is on providing workers in these areas with the best pay experience possible,” Owusu-Asare added.
Some of Cadana’s other features include real-time payments with fees under $3. and options for employees to invest in US dollar assets such as stocks.
Cadana has a few competitors, including UAE-based RemotePass, which also focuses on emerging markets. However, US payroll giants including Deel and Remote are looking at these markets to boost their own growth – so competition looks set to continue to grow.
However, Owusu-Asare argues that Cadana’s differentiating advantage is its expertise in streamlining and expediting remittances for talent in emerging markets, particularly in Africa, Asia and Latin America. During our interview, he points out multiple flexible payment options (“eight+”) available to employees to withdraw money, including mobile money, bank accounts and cards. He also highlights the importance of the startup’s team of legal experts, which he says has “deep knowledge” of local labor laws in various regions.
On the other hand, the CEO told us that he sees global HR platforms like Deel and Rippling as prospects rather than competitors because of Cadana’s position as a provider of payroll APIs and white-label solutions.
Commenting in a supporting statement, Amy Cheetham, partner at Costanoa Ventures, said: “While the US has seen an explosion in technology platforms aimed at streamlining payroll and benefits, the vast majority fall far short of addressing the unique challenges faced by workers and employers in emerging markets.
“Albert and Ameer have built just that, a custom-built suite of white-label products and APIs for emerging markets to power the next-generation pay experience for millions of workers.”
Cadana claims to have processed more than $150 million in transactions for its clients to date. She also reports that clients have increased 3x in the last year (she did not disclose any of her clients). The three-year-old company also told us that its revenue, which comes from tiered pricing and charging businesses per contract or employee paid on the platform, grew 11 times over the same period.
According to its website, the New York-based company has saved workers in emerging markets more than $2.5 million in fees so far. As it looks to remain profitable, a feat Cadana said it achieved last year, it will use the latest funds to expand its team, accelerate product development and expand into new markets.
