HR Tech News – April 2019

European HR Tech firms have taken the spotlight in April. The overall interest and trends in April continued to be similar to earlier months. April saw a total of about 20 deals. USD 300 million plus were invested in various HR Technology companies across the globe. Read for more details  

Strong Beginning to Q2

The beginning month of Q2 in 2019, has had a strong opening. Across close to 20 reported deals, we saw USD 304 million invested in various HR technology companies around the world. This is around 25% higher than what we saw in January 2019.

For the first time this year, we see increased activity in European HR tech market. The biggest deal this month is from France. HR Path, an HR firm that combines consulting with technology, raised USD 113 million in Series C. This represents increased interest just beyond pure play technology players in HR Tech space. This is an interesting case study for investment in consulting and technology-focused companies in the HR space.

Hireology, CRM for multi-location, decentralized enterprises announced USD 27 million series D funding. The recruitment solutions marketplace continues to attract investors and this space is also maturing for further consolidation.

Lumapps, a European company challenging the traditional ideas about intranet and collaboration, raised USD 24 million in Series B. This is one company which is an indication of the blurring boundaries between HR tech and workplace tech. The company combines intranet, social branding, and collaboration into their platform. This is an evolving space with tremendous growth potential.

Eightfold.ai, an HR tech company founded by former IBM and Google researcher, raised USD 28 million in Series C. The company focuses on using AI to match candidates to jobs. Application of AI in recruitment is a hot topic and we have close to 30 different companies within talent acquisition using AI to solve various problems. We expect continued interest from investors, solution providers and buyers in AI and its application to various part of HR.

Other Interesting News

After Fintech, Blockchain is expected to impact HR Tech in various applications. One of the potential applications is skills and qualifications verification using blockchain. Credly, a company which uses blockchain technology to create, issue and promotes digital credentials raised USD 11 million in Series A.

A company using this technology for HR related application was in news after a few months. We expect to see more HR applications being created using blockchain over next few years. This technology has been slower to take off as compared to AI. We attribute that to the complexity and a total shift in the way things are done. While AI can sit on top of what is happening right now, blockchain essentially means moving to a new paradigm. We reckon this one would need a critical mass before acceleration.

Ever since Slack became a unicorn, workplace collaboration software has been a hot topic. Companies are looking to replace email communication with contextual, real-time communication across teams and geographies. This month we saw SAP, commit USD 11 million towards building the collaboration tool Ruum. The tool is deeply integrated into the SAP environment and is powered by an AI assistant. The world of work is changing and like Josh Bersin says, the HR technology solutions need to be in the flow of work. SAP’s investment in this space is further validation of the direction in which workplace technologies are evolving.

Performance management and engagement is one of the most talked about the area within HR. In recent times we have seen fresh approaches to these practices being productized. Lattice, a performance, and engagement software company, raised USD 15 million in series B. Organizations are looking to modernize their performance management processes and this subcategory within HR tech has high growth potential.

Kwench, the corporate library, and employee recognition solution provider has been acquired by OC Tanner. This is yet another acquisition of an India based HR Tech company by a global player. This is growing evidence of the interest of large global HR tech solution providers in the Indian market. It also underlines the maturity of Indian HR technology companies on a global scale.

Summary

The month of April has brought a wide variety of HR technology tools and deals to the fore. The intensified action in European geographies is a welcome change from largely North America focused deals. We expect to see a lot more happening in HR tech space globally and especially in Asian markets.

In the month of May, we have the largest HR tech event from North America traveling to Singapore for the first time. This is after one of the biggest HR Tech conference traveling from India to Singapore in February this year. These 2 events signify the importance of the APAC market in coming years for HR tech solution providers.

With such a solid start to Q-2, we are hopeful that Q-2 will match or surpass the Q-1, 2019 in terms of total $ invested in HR Technology space. We are closely watching this space and will come back with more exciting news from around the world.