Employment Hero racing to $1bn valuation

This Sydney tech start-up has tripled its valuation in just six months, and is not planning on slowing down.

Employment Hero CEO Ben Thompson. Source: Supplied.

Sydney tech outfit Employment Hero has staked its claim to becoming Australia’s next billion-dollar tech start-up, landing a mammoth $140m Series E funding round and tripling its valuation to $800m within just six months.

The Sydney company, which offers a holistic HR tech platform used by 250,000 employees globally, is capitalising on a widespread shift to distributed workforces, with employers globally using its software to manage and pay their remote workers.

CEO Ben Thompson said he’ll use the funding round, led by US-based Insight Partners, to fuel expansion efforts in South-East Asia.

This latest round comes quickly off the back of the company’s Series D round in March which was backed by local investors including SEEK, OneVentures, AirTree Ventures and Salesforce Ventures.

“The scale of what we‘re trying to solve is truly global,” Mr Thompson said. “What we’re trying to do is help small and medium sized businesses feel confident and proud about being employers, and they are constantly struggling to manage employment as a whole, and not just in Australia.

“And moving from an office-based environment to remote work has meant everyone has been force to do things in a new way, and that includes managing people and hiring people. Last year we built a JobKeeper wizard that automated the whole process for getting those payments, and we’re just focusing on the really acute problems that are facing and building the best possible platform to solve them.”

Mr Thompson pointed to statistics from the 2020-2021 fiscal year, showing Employment Hero increased its headcount by 65 per cent, bringing the team to 325 FTEs. Employment Hero’s platform also processed $14bn in gross wages in the past 12 months.

“We’re looking to double our headcount again in the next 12 months,” he said. “We’re working in partnership with Seek on some bundled offers that will roll out before the end of the year into Singapore and Malaysia, as well as Hong Kong, Indonesia, Vietnam and Thailand.

Despite Australia’s ongoing border closures and a slower than forecast vaccine rollout, the executive said his business was moving faster than ever, and hadn’t been hampered by the ongoing Covid hurdles.

“If I compare the past 12 months to the previous five years, if we’d wanted to expand to Singapore for example I would have got on a plane, and it would have taken weeks to scope it out. In this remote environment you don’t have that option, so you just get on and do it. You move a lot faster,” he said.

“I just don’t think we could have done a third of what we’ve done in the normal environment. For us it’s been a hyper growth state.”

Rachel Geller, managing director of Insight Partners, said in a statement: “We have been following Employment Hero’s journey for four years and have seen the impressive and consistent growth experienced by the company.

“Its customer-centric solutions have been embraced globally by the small and medium business community and we are looking forward to supporting them through this next phase of their expansion journey.”