Franklin secures $2.9m for hybrid crypto-cash payroll services

On Apr 4, 2023

Franklin, a company offering tax-compliant hybrid crypto and cash payroll solutions for businesses, has raised $2.9 million in a seed funding round led by gumi Cryptos Capital and CMT Digital.

Franklin offers hybrid crypto and cash payroll services compliant with tax regulations for businesses and startups. It has secured $2.9 million in seed funding. The funding round was led by gumi Cryptos Capital (gCC) and CMT Digital, with participation from investors including Arca, Sfermion, Portage, and Synergis Capital.

This time last year Franklin was just an idea. Over the past 12 months we have been building our product to enable companies in web3 to operate their businesses natively – solving one of the most complex financial operations – payroll.
Today we’re proud to share this milestone. pic.twitter.com/eF0wm4f3Bn
— Franklin 🪁 (@franklinpayroll) April 4, 2023

Catering to small and medium-sized businesses, Franklin’s payroll software allows employers to pay their staff using cryptocurrencies. In addition to the funding announcement, the company revealed that its software now seamlessly integrates with QuickBooks.

Franklin’s platform is available on the Ethereum and Polygon blockchains, with its initial clients including crypto wallet providers Soul Wallet and Echooo, as well as Alto.

Founder and CEO Megan Knab explained that Franklin aims to provide a flexible payroll solution with a combination of cash and crypto options. The company addresses the administrative challenges often faced by web3 native teams regarding tax form generation, compliance, and accounting.

Franklin’s customers primarily use stablecoins for transactions and crypto payments for employee bonuses. The platform also offers batched transactions, multicurrency options, and automated tax filings. Moreover, Franklin can process transactions in U.S. dollars within two business days.

Its platform adheres to the various rules for paying employees in crypto in the United States, considering the regulations on a state-by-state basis. Megan Knab, who has experience as a crypto accountant and former VP of finance at web3 marketing agency Serotonin, founded Franklin in the spring of 2023.

Franklin is the second company to emerge from Serotonin’s product studio, following Mojito, an NFT commerce platform that launched in 2021. Serotonin claims that Mojito has generated over $120 million in sales for clients like Sotheby’s, CAA, Pace Gallery, Lyrical Lemonade, and the Milwaukee Bucks.

Amanda Cassatt, Serotonin co-founder and CEO, mentioned that many Serotonin service clients naturally transition to Mojito or Franklin. Franklin’s pricing model remains undisclosed, but Knab assured that it is in line with existing web2 payroll platforms like Gusto and Justworks.

Notable angel investors in Franklin’s seed round include Sapphire Ventures’ VP Jason Brooke and Associate Iladro Sauls. The company plans to extend its services by introducing crypto-integrated retirement savings accounts and health benefits, as well as compatibility with other layer 2 blockchains.

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