Personio, a startup out of Germany that focuses on the small and medium businesses of the world, went on a funding tear after its recruiting, payroll, people management, development and training.
Personio is doubling down because more businesses are moving their operations back into offices. At a new valuation of $8.5 billion, the company is one of the most valuable startup in Europe.
The funding will be used to build out its customer base and enhance its platform in order to improve internal operations.
The Series E funding is a second closing after the first one in October.
Personio was worth $6.3 billion when it first closed. Despite the increased pricing, Personio is feeling some of the valuation pressure that people have been talking about, but only just.
Since that raise in October, we have grown revenues by 2x, but our valuation has only increased by 30%.
The second part of the Series E was led by Greenoaks Capital Partners. Other previous backers include Alkeon, Lightspeed, Northzone, and GlobalFounders Capital.
Renner said that this extra funding offer was waiting in reserve back in October and that it chose to exercise it now partly because of the investment climate and partly because it is keen to invest while it still sees more growth opportunities.
Personio's core premise is that its software is tailored to the needs of small and medium businesses, with options for self-service integration and no requirement to have dedicated staff to support it.
Initially, it made its name with a tight offering of recruiting tools.
The company has added third-party app integrations and last year started to expand into workflows automation to help carry out task management, approvals processes, electronic signatures and other productivity tools
The acquisition of a German startup called Back has led to the expansion of that set.
Even though it gets approached by larger businesses wanting to use its software, Personio is unlikely to change its target customer size to 2000 employees.
The needs of small and mid-sized companies are vastly different from those of enterprises. The money they are willing to spend on IT is not the only thing the people invest in. Dedicated staff that implement and run tools are required for enterprise solutions. We are in a couple of weeks and there is no need for more resources. These types of solutions are not the same as others.
The company's tools may have come into their own when businesses that had previously carried out operations in person suddenly found themselves needing more digital tools to keep people connected.
While there are hundreds of competitors in this space, including companies like HiBob that also have ambitions to cover HR end-to-end, as well as numerous point solutions, there is a prime opportunity for investors.
Neil Mehta, founder and managing partner of Greenoaks Capital, said that the product has become an indispensable tool for Europe's small and medium-sized businesses. As SMEs face the possibility of economic uncertainty ahead, Personio is a more critical platform that helps customers make their HR and payroll processes more efficient and resilient. Personio is a fast growing company with a sustainable business model and exceptional leadership. We are looking forward to continuing our journey with Hanno and his team.
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