Factorial, the Barcelona-based HR tech unicorn, has secured an additional $120 million in non-dilutive funding from General Catalyst, bringing its total borrowings from GC’s Customer Value fund to $200 million. This investment will fuel Factorial’s go-to-market (GTM) strategy, primarily focusing on sales and marketing expansion. Unlike traditional venture capital or debt financing, this structure allows Factorial to repay the funding through gross profits from acquired customers, ensuring no equity dilution.

Factorial, a leading HR tech company headquartered in Barcelona, Spain, has secured $120 million in non-dilutive funding from General Catalyst, bringing its total funding from GC’s Customer Value Fund to $200 million. This latest investment will fuel go-to-market (GTM) expansion, with a strong focus on sales and marketing to drive Factorial’s growth across Germany, France, and Italy.

Funding Details: Non-Dilutive Investment to Power Market Expansion

Unlike traditional equity investment or venture debt, Factorial’s new funding comes from General Catalyst’s Customer Value Fund, a financing model that does not require equity dilution or collateral. Instead, the company will repay the investment through gross profits from newly acquired customers, allowing it to expand aggressively while maintaining financial flexibility.

Factorial CEO and co-founder Jordi Romero emphasized the significance of this investment:
"General Catalyst’s continued support is a testament to our sustainable growth strategy. This funding allows us to accelerate our market expansion while staying true to our mission of building the most user-friendly and comprehensive business management platform."

From HR Software to Full-Scale Business Management Platform

Founded in 2016, Factorial initially focused on HR software solutions for small and medium-sized businesses (SMBs). During the COVID-19 pandemic, the company gained traction through its freemium model, attracting over 60,000 users before transitioning to a fully paid platform. Over the past year, Factorial’s revenue has grown sixfold, and it now serves more than 13,000 paying businesses worldwide.

As part of its evolution, Factorial has expanded beyond HR functions, introducing Project Management, Training, and Expense Management features, positioning itself as a comprehensive business management platform rather than just an HR solution.

Aggressive Hiring to Support European Market Growth

Factorial plans to use the new $120M funding to expand its presence in Germany, France, and Italy, with Germany being its fastest-growing market. To support this growth, the company is scaling its team rapidly, hiring up to 50 new employees per week, with plans to expand its workforce from 900 to 1,300 employees.

Pranav Singhvi, Managing Director at General Catalyst and head of the Customer Value Fund, praised Factorial’s growth efficiency:
"Factorial has demonstrated an exceptional ability to scale efficiently while maintaining strong financial health. Our investment supports their market expansion efforts and reflects our confidence in their business model."

With $120 million in fresh funding, Factorial is well-positioned to strengthen its foothold in key European markets and expand its workforce to sustain growth. As the HR tech landscape continues to evolve, Factorial’s non-dilutive financing approach and rapid expansion strategy could set a new benchmark for scaling SaaS companies worldwide.