🦄24 Fast Growing WorkTech Unicorns To Follow
#WF15 What’s Behind The Great Work Technology Bull Run?
👋 This is the 15th regular update from the Workforce Futurist Newsletter – which is read by those on a journey to make work better.
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Today’s Workforce Futurist is brought to you by…Huler
Technology has changed the way we work, live, and play. The overwhelming number of work tools and platforms we all use has skyrocketed, leaving us burnt out and less productive. On average, we use 30+ different platforms, sites, and systems in a typical work week!
HulerHub is specially designed to reduce wasted time, connect everything you need together, offer a personalised employee experience, and organise your work and life – so you can get more done, faster.
All Eyes on Workforce Technology
“Now I will believe that there are unicorns.”
William Shakespeare, The Tempest
Work Technology is hot 🔥 at the moment.
In the last week, there have been funding rounds that have propelled several HR Technology firms to the status of ‘Unicorns’ 🦄,
including Visier, CultureAmp, and SmartRecruiters.
Last year, Salesforce bought Slack for $28B.
This year, Workday bought Peakon for $700m.
Microsoft launched Viva to ‘unify the Employee Experience’, adding to its blue-chip corporate stable which includes Teams, LinkedIn, GitHub, SharePoint, 365, and Glint.
$7.6 billion was invested into this segment globally during H1 2021 according to George LaRocque.
Technology has kept the ship afloat during this pandemic. From communication tools providing a lifeline to the housebound to home delivery apps bringing hot food to the front door. We are reliant on technology to work - from the virtual meetings, learning, hiring and asynchronous work tools.
In this edition of Workforce Futurist, I share some of my latest research driven by the following questions:
What is driving this massive investment?
Who are the fastest-growing WorkTech Unicorns?
What’s the Bull Case for WorkTech?
What’s the Bear Case for WorkTech?
Also, opportunities to join
The Workplace Accelerator Programme (for startups)
The #HRandHashtags Fantasy ⚽Football League (for armchair footy fans)
HRTech to WorkTech Scope Creep
HR Technology includes applications along the employee life cycle. From the Applicant Tracking Systems (ATS) that eventually feed into the core HRIS systems that employers use to track their workers, to payroll systems, employee sentiment, and corporate learning systems.
As the location of our work and home has mingled, the domains of our technology usage has mingled too. WorkTech can be defined more broadly to include HR Tech, plus productivity, health, learning, and wellbeing.
24 WorkTech Unicorns
In investment terms, the term Unicorn was coined in 2013 to refer to what was then a rare, mythical species – a privately held start-up valued over $1bn.
8 years ago there were 12 unicorns in the world, today there are 750 worth a combined $2.4trn.
Here are 24 WorkTech Unicorns:
Alan - offering health insurance to European employers.
Articulate – apps for organisations to create eLearning.
Beisen – Chinese HR SaaS and talent management platform.
BetterUp – scalable personalized coaching programs and learning content.
Coursera - online learning for individuals and organizations.
CultureAmp – employee engagement, retention, and performance.
Deel – international payroll, benefits, taxes, and compliance.
Degreed - upskilling platform for skill development and internal mobility.
Go1 - digital learning for the entire workforce.
Handshake – virtual campus recruiting and early career hiring.
Eightfold.ai – AI-powered talent intelligence platform.
Hopin – platform supports virtual, hybrid, and in-person events.
Lattice – performance management platform for mid-sized companies.
Loom – video messaging for work.
Masterclass - streaming platform with hundreds of video lessons.
PapayaGlobal – a global people & payroll platform.
Personio – HR software for SMEs in Europe.
PhenomPeople – integrated hiring platform.
SmartRecruiters - enterprise-grade talent acquisition suite.
Udemy - 155,000 online video courses.
Visier – people analytics platform.
WorkHuman - social recognition platform.
Workrise – workforce management solution for the skilled trades.
Yunxuetang - training platform for enterprise training.
This list isn’t comprehensive but gives a good idea of fast-growing companies in this sector.
Given that these start-ups are now less rare, growing in numbers and prevalent in China, maybe a better term would be Panda🐼, rather than Unicorn?
What is Driving Investment in Workforce Technology At the Moment?
Investment funds searching for better returns have inflated most asset classes, including technology stock. There has also been a divestment spree by the start-ups’ early venture-capital backers. The proceeds are flowing into new VC funds. And there is competition among investors, which now include pension funds, sovereign wealth funds and family offices.
The American Jobs Plan, has allocated $100 billion to be spent on workforce development and helping retrain dislocated workers into high-demand sectors, including energy and manufacturing.
On social media, it appears that there are more ‘Future of Work Investors’ than actual ‘Future of Work Builders’.
Not All Workdays Are The same
In the last 20 months which WorkTech Companies have done well?
For this article, I had a quick look at stock prices for listed WorkTech companies in the US.*
In retrospect, you might think that an investment in Zoom shares would have been shrewd early in 2020 – and their shares have increased by 382%.
The baseline for this analysis was Workday, which increased by a respectable 30%.
But the big winners were those enabling gig workers and freelancers for example Upwork (up 478%) and Fiverr (up 817%).
In my essay Unleashing the Decentralised Workforce – I highlighted how people are making a living utilising digital infrastructure including platforms such as Shopify, Etsy, Twitch, Talmix, Teachable.
There are big opportunities within and outside traditional employers.
There are those making a living in the Creator Economy, here are 220+ platforms that are helping people turn their hobby into an income. Including Patreon, Kajabi, Cameo, and Substack.
* This doesn’t constitute investment advice. As they say, DYOR - Do Your Own Research. Dates for the chart are from 23rd January 2020 to 23rd July 2021.
The Bull Case for Workforce Technology
WorkTech is diverse enough to include ADP, Loom, and Udemy.
Here are some general reasons for investing in this sector.
Huge global demand for upskilling and learning - inside and outside organisations.
There are over 3 billion workers globally - many work in SMEs who have not been serviced by HR SaaS tools until relatively recently.
A massive opportunity to improve the employee experience - the average user has to open 30 different apps, or platforms in a given workweek.
The New Technology of Teams - our HR processes are geared up to individuals, not to teams where work actually gets done.
The holy grail - provide systems to self-sufficient teams that can source and manage teams by using predictive analytics.
Typically, innovation happens in smaller start-ups. These are then bought up by the industry behemoths, who decide to kill or attempt to integrate depending on market conditions.
The Bear Case for Work Technology
For balance, I would also include some general health warnings for investing in WorkTech. This depends on the particular business, and for every bear, there is a bull of course.
1. The data is poor quality - as they say if you put poor data in, you get poor data out. Billions invested in AI technology relies on good quality data.
2. Current infrastructure is vulnerable to cyber attacks – employee data is stored in centralised servers and susceptible to data breaches. A recent survey by Mercer found that Cybersecurity was the top risk identified by HR and risk managers.
3. A very crowded and competitive market - there are 1000s of applications competing for the attention of buyers. With very high valuations, some Unicorns will struggle to grow revenues and make a profit.
4. The workforce is changing quicker than organisations’ ability to respond, yet alone for tech vendors to respond. (see for example The loneliness of the long distance worker and The great flourishing - why people are quitting their jobs)
5. Web3 changes everything – a new infrastructure of work is being built that will give workers more autonomy and control over their data. Self-sovereign identity, the tokenisation of work, NFTs, digital credentials, and DAOs. With verifiable, employee-owned career profiles – how will background screening and recruiting processes change?
Onwards and Upwards
“O, brave new world that has such people in't!”
William Shakespeare, The Tempest
Technology can be a force for good if harnessed in the right way.
There will be many opportunities for entrepreneurs, organisation builders, technologists, and creators. Do share your thoughts and experiences of WorkTech with me.
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Workplace Accelerator Programme
I am a mentor this year for the European leg of the Workplace Accelerator – established by Daniel Callaghan and partners. It was built on the belief that WorkTech can be a force for good and support the change needed in the world.
They have developed a 12-week programme that focuses on helping businesses get everything they need to succeed including direct access to client mentors, masterclasses from SMEs, with access to investors and funding.
Start-ups can apply to Workplace Accelerator here.
Applications close on 31st August 2021.
#HRAndHashtags Fantasy Football ⚽ League
For footy fans, think you can do better than Pep, Klopp, and Ole?
For a few years, I have hosted the #HRAndHashtags Fantasy Football⚽ league.
You can pit your wits against some of the greatest armchair managers in HR, technology, and academia.
Its free and fun, just reply to this email or DM me and I will send you an invite code to join the league.
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