Article: Funding & acquisitions in the HR Tech and work space: Jan-Mar 2019

Funding & Investment

Funding & acquisitions in the HR Tech and work space: Jan-Mar 2019

In this quarter, software products company Zoho acquired ePoise Systems, a hiring automation product startup while globally, Florida based HRM software company Ultimate Software was snapped up by Hellman & Friedman Capital Partners in an $11 Bn deal.
Funding & acquisitions in the HR Tech and work space: Jan-Mar 2019

The last quarter of 2018 saw only modest activity in the skilling and HR tech space and the same sentiment followed in the first quarter of 2019. However, HR tech players in India remain upbeat about the coming year. The year started with more investment and funding activity in the global space compared to the Indian HR Tech space.

As per Deloitte Consulting LLP, the HR technology marketplace is a $400 Bn market globally. Investor interest in this sector is steadily growing globally and in India as well. It is estimated that Indian firms can save at least $600 Mn annually with HR tech. As organizations turn more towards digitization, investments in the sector are expected to grow.

Here’s a quick look at the significant fundraisings and acquisitions in the HR tech space and workspace in the first quarter of this year.

Fundraisings/ Investments from Jan-March 2019

  • Shortlist: Shortlist, the online platform connecting African and Indian employers to top talent, raised $2 Mn in a round of Series A financing led by Blue Haven Ventures, with participation from Zephyr Acorn, Compass Venture Capital, Potencia Ventures, and others in February.
  • One of the biggest fundings in the quarter was that of CareerArc, a global leader in HR technology, which raised a $30 million growth equity round led by PeakEquity Partners. The company, founded in 2009, will use the investment to fund an aggressive expansion plan to support product innovation and accelerate sales and marketing efforts.

Globally, Hone, the reimagined workplace training platform for modern and distributed teams, raised $3.6 Mn in a seed round led by Cowboy Ventures and Harrison Metal. Additional investors who participated include Slack Fund, Reach Capital, Rethink Education, Day One Ventures, Entangled Ventures, CEO of Masterclass David Rogier, CEO of Guild Education Rachel Carlson, Co-Founder of Atrium HQ Pete Kazanjy, and Co-Founder of Grovo Jeff Fernandez.

In February, outbound recruitment platform, Fetcher announced its latest round of funding where it raised $5.4 Mn. The funding round was led by Accomplice and Slow Ventures, with the participation of existing investors like Picus and Revel Partners, Paul English (Founder of Kayak), Amol Sarva (Founder of Knotel) and James Joaquin (Co-Founder of Obvious Ventures).

Meanwhile, closer home in the APAC region, Vietnam based giftech startup UrBox that helps connect businesses with gift suppliers and merchants to enhance their rewards and loyalty programs, raised an undisclosed amount of seed money from local venture capital firms VinaCapital Ventures and VIISA. 

Another funding in the APAC region was Singapore-based health-tech startup, Docquity which raised US$11 Mn series B funding. The funding round was led by Itochu Corporation JapanDocquity was founded by 2015 by Indranil Roychowdhury. Commonly referred to as ‘LinkedIn for Doctors,’ and helps doctors and physicians to find, connect & collaborate with trusted peers, specialists and other professionals over secure doctors only platform. The platform is currently present in seven countries

The quarter also saw EmployStream, the HR tech firm that enables the staffing industry to automate the onboarding process, closed its Series A round of funding by raising $3.5 Mn with JumpStart Inc. being the key investor. Other investors include Ohio Innovation Fund, North Coast Angel Fun, and Rev1 Ventures.

Tel Aviv headquartered transformative HR tech platform Hibob also raised $20 Mn in Series A+ funding from existing investors: Bessemer Venture Partners, Battery Ventures, Eight Roads, Arbor Ventures, and Presidio Ventures in this quarter. The expanded investments will drive the next phase of Hibob’s hyper growth, help to establish it as the platform of choice for fast growth companies, and accelerate its penetration in the US and across Europe.

Acquisitions from Jan-Mar 2019

In the Indian HR tech space, two acquisitions were completed in these three months.

  • Zoho and ePoise: Software products company Zoho acquired ePoise Systems, a hiring automation product startup for an undisclosed amount. Founded in 2013 by Sachin Agrawal and Bishan Singh, ePoise automates multiple screening steps for multiple roles.
  • OLX and Aasaanjobs: online marketplace, OLX Group acquired Aasaanjobs, the recruitment platform for blue and grey-collar jobs in India to further strengthen its jobs vertical. With this acquisition, OLX Group looks to strengthen its position in the online job search segment.

Globally, one of the biggest acquisitions of this quarter came when Florida based HRM software company Ultimate Software, which creates a cloud-based human resources management software was acquired by Hellman & Friedman Capital Partners in an $11 Bn deal in February this year. The cash deal will enable the HRM software company to invest in innovative products and services and also reward deserving employees.

Meanwhile, Japanese technical staffing firm Trust Tech acquired about 44.42% stake in L&A investment corporation, which owns Vietnam HR company Le & Associates. The acquisition comes as part of Trust Tech’s plan of expanding its businesses in different countries which is part of its strategy in its medium-term management plan.

The quarter also saw employee feedback company, Culture Amp acquiring Zugata another company dedicated to performance management to bridge the gap from knowledge to action by connecting all of the feedback at the individual and organizational level. Zugata's acquisition allows Culture Amp to bring an increasingly sophisticated use of data across the employee lifecycle.

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Topics: Funding & Investment, HR Technology

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