Human resources

Canadian HR startup Humi secures $31M Series B round

HR managers from ADP and Gusto have invested in Humi.

HR tech startup Humi has secured C$31 million in a Series B funding round led by Kensington Capital Partners.

With a focus on providing HR technologies specifically tailored to Canadian businesses, Humi is looking to expand the capabilities of its platform and meet what it says is growing demand for its solution.

The round was led by Kensington Capital Partners and included a mix of new and old investors. Struck Capital and Tribe Capital, which led Humi’s C$15 million Series A in 2020, provided follow-on funding, while Telus Ventures, Kensington and Flex Capital joined as new investors.

Humi has also attracted checks from a group of angel investors, including leaders in the HR space such as Rodney Dobson, former president of ADP Canada and UK, and Mike Dinsdale, the former chief financial officer of the American HR startup Gusto.

The Series B round included $25 million in equity and $6 million in debt, and closed earlier this year. The funding brings Humi’s total funding to date to $51 million.

Since August 2019, Humi claims to have experienced “incredible growth”, noting a fivefold increase in the number of employees on its platform.

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In the early months of 2020, Humi co-founder and CEO Simon Bourgeois noted that the COVID-19 pandemic ushered in a world of remote working that proved a boon for his startup.

At the time, Bourgeois said Humi was seeing more and more traditional businesses adopt a remote-friendly working experience, which led to an 80% increase in demand from companies looking to hire, onboard, pay and track from Humi’s cloud platform.

Humi has added new product offerings alongside growing interest in its cloud-based HR platform, including business insurance, a benefits marketplace and a broader set of tools to support digital recruiting and recruitment. integration of new employees.

The HR or Human Capital Management (HCM) space in which Humi plays is competitive. Traditional players include big names like Oracle, Sage, SAP, Workday, and ADP. According to Boston Consulting Group (BCG), the market for HCM software has grown significantly in recent years. According to a March BCG report, more than $12 billion in venture capital flowed into the HR technology market in 2021, with the rate of investment more than tripling from the previous year. This was due, according to BCG, to challenges in the area of ​​talent management.

“Many HR technology companies that previously specialized in just one aspect of the talent management value chain are building more comprehensive offerings, and others are growing through consolidation,” BCG noted.

In Canada, startups like Rise People and Collage (acquired by HR provider People Corporation in 2019) have sprung up to meet the HR needs of Canadian businesses. This focus on Canadian companies is something Humi sees as a differentiator.

Bourgeois said many HR vendors have shifted their focus away from Canada-specific HR, payroll and benefits solutions in recent years. For this reason, Humi has become “hyper-focused” on the Canadian market. Bourgeois told BetaKit that medium and large Canadian businesses are Humi’s primary focus.

Bourgeois compared this approach to that of Gusto, a US-based HR technology company, which recently raised a US$10 billion extension to its US$175 million Series E funding round from 2021.

The former CFO of Gusto’s angel investment is notable by comparison. Dinsdale said Humi’s solution “solves unique challenges” in HR technology, calling it the earring of a rapidly changing industry.

Image source Humi website.