Deel, a startup that makes it easy to hire people in other countries, has just quadrupled its valuation to $5.5 billion in a deal led by Coatue

• Remote-hiring startup Deel has more than quadrupled its valuation in a funding round led by Coatue.
• The three-year-old business has raised $425 million at a $5.5 billion valuation.
• The startup forecasts $50 million ARR by the end of 2021, implying a bullish valuation.

Hiring startup Deel has more than quadrupled its valuation to $5.5 billion, as remote work spiked during the pandemic.

The San Francisco-based startup has raised $425 million in a round led by New York hedge fund Coatue. The Series D raise comes six months after its previous funding round, which valued the business at $1.25 billion.

Deel automates payroll, benefits, compliance, and other HR functions through an API to help companies scale remote teams. The startup also acts as an employer of record (EOR) in more than 50 countries, which enables companies to hire people in other jurisdictions without having to set up a local presence or worry about regional tax codes.

“We’re seeing that generally borders are breaking apart and more people want to travel and work abroad,” Deel CEO and cofounder Alex Bouaziz told Insider. “The talent war means that top talent will demand this flexibility and where previously it couldn’t happen, now it can, so we believe this shift is here to stay.”

Deel’s growth in the past year has been strong, Bouaziz said. The startup’s headcount has swelled from around 60 people last year to more than 400 currently. He also said the firm’s revenues have boomed, rising from single-digit millions in ARR to a forecasted $50 million by the end of the year, indicating a bullish valuation.

The market for virtual HR software is set to be worth around $43 billion by 2026, according to research by CB Insights.

Bouaziz said the firm could “grow aggressively” with its new funding, and that it raised without putting together a formal investor pitch deck.

Alongside Coatue, several new and existing investors also participated in the round, including Altimeter Capital, Andreessen Horowitz, the YC Continuity Fund, and Spark Capital.

The funding will go towards continued growth internationally, with Deel set to release new products including a premium offering in the next year. The startup also wants to make acquisitions to grow, Bouaziz said.