HR Software Worth Billions

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The July jobs report revealed more evidence that the power dynamic between the provider and recipient of a paycheck has thoroughly shifted. The “reservation wage,” or acceptable starting rate to take a job, has risen most significantly for workers without college degrees, rising roughly 19%, the equivalent of $10K more annually. It’s also 19% more difficult to retain these workers. Simply put, there are a reported 10.1MM open jobs as of June 30th, and only 954K people looking for work.

 

                                                                                     Photo: Reuters

Then there are the remote workers, the ones who aren’t eager to return to a “before” and have figured out the true cost of their commute. For some fortunate Americans, the pandemic helped them learn to live with less (less Broadway, fewer drinks, less fashion) and to finally start that rainy day fund. They’re empowered to put hobbies, family, mental health, and leisure above the previously glorified #hustle culture.

What does this change truly mean for employers? Attracting and retaining top talent for service and white-collar jobs alike means adapting -- adapting to salary requirements, flexibility needs, development desires, and wellness necessities, which are all par for the course in this job landscape. Of course, adapting is easier said than done. Hence why there’s a boom in investment towards companies reshaping the way we attract, hire, and retain employees and freelancers.

👩‍🍳 Gusto is the big one here, as it just announced it has secured a whopping $10BN valuation for its HR software tools. Gusto makes even the smallest company have its ducks in a row when it comes to payroll, onboarding, legal, and benefits. The company just raised a $175MM funding round led by T. Rowe Price. *Hot tip: I used this software in my previous life as a pie shop owner. Recommended 10 out of 10.

🤝🏿 Gloat emphasizes employee satisfaction. The start-up has developed software designed to extract maximum creative energy and motivation out of employees. Gloat paints a compelling picture on its website of simplifying and mapping out the career growth trajectory of an employee, which is all too often an opaque process for many companies and their frustrated employees.

😅 Aaptiv is an on-demand fitness class app that moved into the enterprise space shortly after most employees were forced into lockdown. An undisclosed April 2020 funding round from Insight Partners made it possible. HR article after HR article mentions investment in employee health as a huge benefit to overall employee health, wellbeing, and ultimately, performance.

⏳ Headspace is a breakaway star in meditation apps, due to the company's Headspace for Work solution for enterprise customers. The start-up created Headspace for Work after a 2015 study at pharmaceutical company Genentech revealed that employees who meditated felt more content at home and work. The groovy Santa Monica company most recently raised just over $100MM in a Series C round.

🏆 Honorable mentions: Human Interest (who just raised $200MM) is making 401ks sexy. Chronus just got $78MM in growth capital for helping companies with mentorship programs.