Human Resources tech start-up fundraises $263m in funding from US-based TCV

Employment Hero is set to be the biggest local tech export since Canva and Atlassian after raising $263m, to be now valued at almost $2bn.

A human resources and payroll start-up is set to be the biggest tech export since Canva and Atlassian after raising $263m – the biggest capital raising of the year for a local privately held software business.

The funding round was led by US-based TCV, which has bank rolled Spotify and Airbnb in the past and takes Employment Hero’s valuation to $2bn compared to $800m two-year’s ago.

Founded by Ben Thompson and Dave Tong nearly 10 years ago, the company now plans to use its new war chest to fuel a rapid global expansion, particularly in the UK where it sees a massive addressable market of local small and medium enterprises.

It will also enable the company to also accelerate growth into key international markets of SmartMatch — its AI-driven recruitment solution — which promises to help small and medium enterprises recruit talent on an automated basis to compete against large corporations.

Employment Hero is an all-in-one platform to recruit, on-board, pay and manage talent seamlessly and compliantly.

The Series F funding takes the total amount of capital it has raised to over $650m and comes when the tech sector has seen valuations hammered by rising interest rates and inflation. Raisings have also been more challenging with investment groups more cautious and taking their time before deploying capital.

Employment Hero chief executive and founder Ben Thompson said the company would remain private and that it had received significant inbound investor interest despite not actively seeking funding.

“This has given us incredible confidence in our vision and allowed us to opportunistically boost our balance sheet, even at a time when the funding environment has been tight,” he said.

“TCV is a leading technology investor with an enviable track-record backing many of the world’s most ubiquitous digital platforms like Airbnb and Spotify, so we are very excited to welcome them aboard as we do the same for employment”.

TCV general partner Muz Ashraf said that the platform had the potential to make employment work better for employers and employees globally.

“We have been fortunate to know Ben, Dave, and the broader Employment Hero team for several years, and have been deeply impressed by their ingenuity, grit, and velocity in solving one of the fundamental pain points facing small to medium-sized businesses,” he said.

Employment Hero is based in Sydney and services over 200,000 businesses globally. Early backers Insight Partners, AirTree, Seek and OneVentures all participated in this raise.