Payflow is the leading Pay on Demand and Flexible Compensation company in the European Union and Latin America, with the most complete Financial Wellness platform on the market.
Through an intuitive application, users can collect a portion of their salary already earned, save their earnings in automated virtual piggy banks, and get educated on finance through its interactive classes. And with the Flexflow card, they can save on taxes when paying for food, transport, daycare, and education.
The platform is completely free for employees and a strategic ally for Human Resources teams, increasing productivity and the employee experience. Payflow has more than 500 clients and operates in Spain, Colombia, Portugal, and Peru.
Payflow(officially: Payflow Digital, Inc.)
🏢 Industry - Fintech
💻 Location - Spain, Portugal, Colombia and Peru
👨👩👦👦 Team size - 25
💰 Funding stage - Series A
📅 Founded in - 2020
How Payflow Created Their Equity Compensation Policy: From YC Flip to Running Away From Equity Questions
Benoit and Avinash, the co-founders, of Payflow, realized soon in their entrepreneurial journey that it was important to grant equity to key people in their team to keep them incentivized for the long term. They had no doubt that equity comp would be a key driver for retaining and motivating their employees 💪🏼.
But Benoit and Avinash had a problem.
Their holding company was based in the U.S., while the majority of the team lived and worked in Spain. This was a huge obstacle. How could they implement an equity compensation program across borders, in different countries, and with different laws?
The “YC Flip” Nightmare
Payflow, like many YCombinator (YC) companies, had to relocate their holding company from Spain to Delaware to take part in YC Summer 21 (YCS21).
💡 If you’re curious about the other companies of YCS21 batch, you can find the list in the YC directory.
But this sort of relocation, also known as a "flip," isn't an easy thing. It's slow, expensive, and an administrative nightmare with a splurge of legal fees 💸. This is true for all companies but even more so for those companies that have already been in business for a while prior to flipping.
Choice Of Cap Table Management Solutions
Then came the choice of how to manage Payflow’s cap table, with 3 main options on the table:
- Pulley 👉 a former YC company and widely used in the YC alumni community
- Carta 👉 the market leader in the U.S. (which Payflow eventually opted for)
- A good old-fashioned spreadsheet (which shouldn't be an option unless you’re an Excel geek 🤓)
They worked hard to define what they wanted, and to find the solution that was best for them. They took time out of their incredibly busy schedule to find the right answer. And finally, after putting in money and precious hours sweating over this choice (time that should have been spent focussing on go-to-market and product initiatives), the Payflow co-founders finally made a decision: procrastination.
But you can only kick this can so far down the street before you have to face the problem again. And it wasn't long before the decision they were avoiding reared its head again.
That’s when Benoit heard about a solution recently launched by co-founder and CEO of Easop Valentin Haarscher, a former colleague of his at Bain.
Why Payflow Is So Excited About Easop
🗣️ Benoit Menardo, co-founder at Payflow
"Using Easop is a real game changer for any founder who believes equity should be more than a tick-the-box, but does not want to pay a fortune in legal fees or spend hours on admin tasks."
- Tax & Compliance Peace of Mind
Payflow has been quickly expanding in Latin America, which was completely uncharted territory from an equity compensation perspective. Without Easop, Payflow would have had to find lawyers in Peru and Colombia sufficiently knowledgeable about stock options to give a meaningful recommendation regarding the type of equity incentive to be used.
It would have taken them hours to manage, and even then they wouldn’t have been sure that the lawyer was the right one. Their lawyer might have no idea what they're doing, they might not be up to date on different laws or enforcement practices, or their lawyer might just be flat wrong. Because the truth is, they wouldn't know whether these lawyers were right or not. They have no choice but to trust them.
So Easop immediately put Payflow at ease by enabling them to unlock two types of instruments: Non-Qualified Stock Options and Stock Appreciation Rights. Both of these instruments have been prepared with U.S. and local lawyers, without Payflow having to ever worry about any of the legal & tax complexities (Easop took care of those 💡).
- Amazing customer support
“Easop is made of true experts who see people making mistakes around equity day in and day out. They are all real problem solvers who know how to fix things quickly and efficiently. They’ve dug into equity like no one else and it’s something that I can feel in my interactions with them. Plus, they come at a fraction of the cost I can expect if I send an email to a traditional lawyer” Benoit says.
- Cost efficient and predictable
According to Benoit “Long gone are the days when I feared unexpected invoices relating to Payflow employee equity. I used to sweep equity topics under the carpet to avoid involving my lawyers. Now, we’re billed monthly with predictable fees. No matter the number of questions, grants made or modified, I can put a hard figure under the admin costs section of my P&L”.
- Grant flow and API integration with Carta
Finally, Benoit added “Once I’ve defined the parameters for a new hire or someone I want to promote, there’s almost no action required from me. Their UX and integration with Carta is super smooth. But I also know they’ve created the right guardrails to make sure I stay in compliance. I never have to worry.”
Discover the future of stock option management with Easop. Your journey to seamless, compliant, and hassle-free stock option management begins here 📈