Factorial, one of Europe’s highest-valued technology scale-ups and a fast-growing presence in African enterprise markets, announced the closing of a $150 million Series D funding round led by General Catalyst, valuing it at $2.5 billion.
The round also included participation from existing investors Atomico and Four Rivers. Alongside the investment, General Catalyst will invest an additional $540 million of non-dilutive capital via its Customer Value Fund, giving Factorial over $700 million of non-dilutive funding.
This investment is being made at a time when HR technology adoption has been rapidly increasing across East African nations.
Enterprises have finally begun recognizing the limitations associated with using manual people management tools and that there are some gaps within the current local/global solutions that are yet to be addressed by any player.
The importance of this investment cannot be overstated in the East African enterprise sector. As revealed by Deloitte in its ‘2025 Africa Human Capital Trends’ report, more than 60% of medium-sized enterprises based in Africa’s major cities have adopted at least one digital HR tool.
Although it’s a positive sign of growing adoption rates, it is just a starting point. The Africa payroll software market, valued at $487.3 million in 2026, is expected to grow to reach $1.66 billion by 2035, expanding at a 14.60% compound annual growth rate (CAGR).
According to the report, increased cloud adoption, compliance burden, and growth in mobile-first enterprise infrastructure are some of the factors driving growth within the region.
As governments impose more stringent tax regulations in their nations, businesses have begun seeking cloud-based HR platforms equipped to handle complex regulatory frameworks. This year alone, it will no longer be an option for Kenyan enterprises to undergo digital transformation.
Manual HR operations, spreadsheets, and disconnected platforms have all become a hindrance to the growth of companies.
For instance, an HR system helped a logistics firm in Kenya to streamline its payroll process from five days to under six hours, as well as reduce the number of errors considerably.
Such transformations aren’t far-fetched either, as these are the kinds of returns that are being sought out by East African enterprises.
At the heart of this latest funding round lies a fundamental transformation in Factorial’s product portfolio and its market definition. Over the past decade, Factorial has built one of Europe’s largest record-keeping ecosystems spanning human resources, finance, and IT for over 16,000 businesses across over 90 countries.
Now, the company is completely revamping this ecosystem as it has transformed itself from a conventional Software-as-a-Service provider to an AI workforce operations platform where people work hand-in-hand with AI agents. At the center of the transition is Factorial One, a unified workspace built around the concept of a two-agent system.
The company has trained an AI agent to learn all the policies defined by organizations in the HR, finance, and IT categories. The second agent is dedicated to representing the employee, as it enables them to multiply their abilities by drafting work, suggesting what they need, and performing various tasks on their behalf.
“Ten years ago, we started Factorial as a SaaS company,” said Jordi Romero, CEO and Co-Founder of the company. “Today, Factorial is an AI-first company, working towards creating agents for our clients. We have completed our transformation journey by resetting the product, the architecture, and running our client’s operations around AI agents. This partnership will give us the required confidence and capital to build an industry-defining product.”
For East African enterprise leaders, the transformation in Factorial’s business model helps address a critical problem area in a big way.
Businesses across the nation are scaling at a faster pace every year, whether it’s a technology startup in Nairobi or a financial firm in South Africa. With growth comes challenges related to the effective management of payroll, HR compliance, talent engagement, and performance tracking.
Some of the latest HR technologies trending across Kenya in 2025 and 2026 include cloud-based HR systems, automated recruitment and onboarding tools, data analysis, and employee engagement platforms, allowing organizations to save costs, provide improved experiences for employees, and adhere to Kenyan labour laws.