How Millennials are transforming the tech landscape
At Scale, one of the markets we’ve been bullish on in the last several years is HR technology. Why? Talent is the most important resource in knowledge economies and companies are investing heavily in technology to engage and retain the best employees. We’re also seeing a generational shift as Millennials take the reins as the largest generation employed in the workforce. When it comes to technology, Millennials have certain expectations from their software. Software that purely automates a process doesn’t cut it – you need to be mobile, social and provide a good user experience. The HR industry is in a purchasing cycle and managers are buying software with these trends in mind. We’ve made a couple of bets in next-generation HR technology. Early last year, we invested in Lever. Today, we’re excited to announce Scale’s newest investment: Namely.
Why Namely? First off, the market is significant. Every new business needs to figure out how to pay employees and provide benefits. Namely provides a mission critical piece of HR technology to their mid-market customers - HRIS, payroll, performance management and benefits all in one platform and have done so with end-users in mind. It’s easy, slick and provides a rich set of features. For us, it stood out as a leader in the space and one that we wanted to be involved with. Here’s why:
- Mission critical product and enormous market. Based on our calculations, mid-market, core HR is a $10+ billion opportunity. Even though Namely has 650+ customers, there’s still a lot of room to grow.
- Consumerization of HR. As the consumerization of the enterprise continues to permeate across companies, employees are demanding easy-to-use software in every aspect of their life, including their HR software. Employees don’t engage with products with terrible user experiences. While doing due diligence, we consistently heard from Namely customers that Namely has the most intuitive UI. Employees are actively engaging with Namely, whether they’re giving kudos to a peer or checking their most recent paystub.
- Tailored Solution for the Mid-Market Customer. Mid-market customers have complex needs. They tend to have smaller HR teams and need to rely on technology for automation. Namely saw the opportunity in the mid-market and built an all-in-one solution with HRIS, performance management, payroll and benefits all in one system. With Namely, HR managers can simply their workflow and reduce administrative tasks. HR managers can now focus on more important projects instead of manually entering data into multiple systems. Impressive financial traction. We’re data-driven investors and dug into Namely’s metrics to assess the Company’s financial health. We came away impressed with Namely’s strong growth in the last 2 years. We’re excited to invest in their future growth with this new round of funding.
- Strong Team. We’ve known Matt for 3+ years and he’s consistently impressed us with his HR knowledge and the team’s ability to execute.
Please join us in welcoming Namely to the Scale portfolio!