As per media reports, PE firm Multiples Alternate Asset Management is planning to acquire a controlling stake in human resources (HR) outsourcing and technology firm PeopleStrong for Rs 400 crore.
This news reinforces the positive outlook for the HR Industry that has seen tremendous growth in the last 12 months as more and more home-grown HR businesses are scaling up. The Indian HR industry is estimated to be upwards of Rs 30,000 crore in value. The recruitment industry saw two IPOs in 2006: TeamLease IPO received an over-whelming response and was subscribed over 66 times in February last year (Read our analysis here). A peer to TeamLease, Quess Corp hit capital markets to raise Rs 400 crores in July and got fully subscribed on day 2 and was oversubscribed by 144 times on closure (Read our complete story here).
We also saw additional investments happening in the HR space: Greytip Software, a leading provider of HR and Payroll solutions to SMEs & enterprises across India, raised Rs 35 crore in its series B round of funding from New Enterprise Associates (NEA) and Blume Ventures expand its business. Darwinbox, a Hyderabad-based HR software-as-a-service (SaaS) startup has raised seed funding led by Mohandas Pai's 3one4 Capital, Endiya Partners and Tracxn Labs to fuel their expansion plans.
If the news of the acquisition of PeopleStrong by Renuka Ramnath-led PE fund gets confirmed, then this is going to be the first of its kind in the HR industry, and also a new opportunity for more firms in the HR space looking for ways to scale.
PeopleStrong was founded in 2005, by Pankaj Bansal and Shelly Singh and have grown tremendously servicing today over 175 multinational and Indian clients, including Tata Motors Ltd, Hero MotoCorp Ltd, Mahindra and Mahindra Ltd, Procter and Gamble India Ltd, Mondelez India Foods Pvt. Ltd, HDFC Life, Indigo Airlines, Vistara, Cipla Ltd, Dr. Reddy’s Laboratories Ltd, Hindalco Industries Ltd, Wipro Ltd and CitiBank India. It is present in 40 Indian cities and employs more than 800 professionals. Over a decade-long journey sees PeopleStrong with over 800 strong team and their HR App will enable professional to access and transact all HR related processes. The current investors in PeopleStrong today are Lumis Partners, HDFC Holdings and The HR Fund.
PeopleStrong has been one of the few companies globally that has been able to transform form a service company (primarily when they started) to a technology product company that brings innovative products to HR. PeopleStrong launched their HR mobile app early in 2016 and launched chatbot “Jinie” first HR Chatbot from India in December last year.
Responses from PeopleStrong & The HR Fund are still awaited.
Disclosure: The HR Fund is an investor in People Matters Media Pvt Ltd.