Following a very strong recovery in 2021 and an initial softening in 1Q 2022, the HR Tech and broader Work Tech sectors are beginning to feel the impact of high inflation and uncertain macroeconomic outlook. In this context, the second quarter closed with mixed results:
Both in M&A and venture, there are two types of buyers / investors: those who take a “risk-off” approach across the board, and those who are more nuanced when assessing opportunities. Valuation expectations between companies and buyers / investors diverged somewhat abruptly, particularly for businesses that have yet to feel any adverse impact to their operations. However, we are still at the beginning of what is likely to be a protracted battle against recessionary forces.
We expect that the current sentiment dichotomy will be reflected more comprehensively in the figures of Q3 and Q4, before the level of impact on businesses gradually becomes clearer and viewpoints start to reconverge.
Venero Capital Advisors is pleased to support as headline sponsor the TIARA 2022 Talent Tech Star Awards.
Congratulations to EightFold.ai for being crowned the Venero Capital Advisors Talent Tech Champion of Champions!
Judges praised Eightfold for a genuinely innovative solution that is championing the move to skills-led recruitment at scale and proving its success as the model for its own business as the Best Talent Tech Company to Work For.
Georgios Markakis, Managing Partner at Venero, commented: "Venero is a proud sponsor of this award, which showcases a Talent Tech Star whose solution exemplifies innovation, while also delivering particularly far-reaching value and impact.
Each and every one of this year’s winners are championing transformation and innovation in HR and Recruitment. However, this year’s Champion of Champions addresses a crucially important challenge, in many ways a paradigm shift in the way companies around the world attract and retain talent, and does so with cutting-edge innovation, client service and leadership."
Well done to all the finalists and winners!
Paris, 10 May 2022 - Venero intensifies its focus on the French market with the appointment of HR Tech veteran Marc Garrido as Head of French Coverage.
Marc has over 35 years of professional experience in the HRIS industry, where he has held positions at organisations including ADP, IBM and HR access Solutions (Fidelity Investment). His entrepreneurial experience includes acquiring ICRH Group, growing it by 3x and subsequently selling it to HR Path. For a period of 7 years he has supported HR Path with fundraising, acquisitions and integrations, organic growth, organisational transformations, strategic partnerships and international development. He remains a strategic advisor to both early stage and established players of the HRIS industry in France and in Europe.
Barcelona, 26 April 2022 - Leading Spanish time & attendance software provider Woffu has entered into a definitive agreement to be acquired by Visma. Venero Capital Advisors acted as exclusive financial adviser to Woffu.
Barcelona-based Woffu was founded in 2015 by Miguel Fresneda and Víctor Pérez. It has 55 employees and nearly 1,500 clients. 130,000 employees daily use Woffu's solution to optimize their time, request vacations, manage absences and comply with time control regulations.
Visma is a leading provider of mission-critical business software, with 14,000 employees and 1.2 million private and public sector customers across the Nordics, Benelux, Central and Eastern Europe and Latin America. Woffu is Visma's third acquisition in Spain.
A total of $9.2Bn was invested in WorkTech and HR Tech during Q1 2022 across 205 deals. The average investment size contracted to $48.4M vs. $60.9M in the previous quarter, indicating a reversion to the mean after an abundance of later-stage financings in 2021.
In terms of M&A, 48 WorkTech acquisitions were announced this quarter – a sizeable decrease compared to Q4 '21. In part, this reflects the macroeconomic and geopolitical uncertainty that caused some transactions to be delayed. Nonetheless, M&A sentiment remains positive heading into Q2. Notable transactions included the announced acquisition of Anaplan by Thoma Bravo, and the acquisition of EdCast by Cornerstone.
In the public markets, trading multiples for high-valued Workplace Productivity businesses contracted in Q1, in line with much of the broader technology sector. Pure WorkTech companies as well as their Productivity and Diversified WorkTech peers contracted by 32%, 27% and 13% respectively. Valuation for HR Services businesses showed greater resilience, expanding slightly.
New York, NY and Vienna, 25 January 2022 - Radancy, the global talent technology leader, is expanding its unified platform with the agreement to acquire Austria-based Firstbird, the global leader in SaaS based employee referral programs. The planned acquisition of Firstbird expands Radancy's presence and commitment to the DACH market and complements its teams across Europe. Combined, the businesses can offer talent acquisition teams a unique recruiting solution, empowering them with a competitive advantage to attract and hire better talent faster in the global job market.
Valuation multiples for publicly-listed Workplace Productivity businesses contracted in Q4, in line with much of the broader technology sector. Median valuations for HR Services and Diversified WorkTech showed greater resilience, expanding by 28% and 13% respectively. In terms of M&A, 70 WorkTech acquisitions were announced, a c.9% increase compared to the previous quarter with significant interest in Talent Acquisition as well as Workforce Management assets. Private Equity was involved in c.7% of transactions. Investment volumes remained elevated, with more than $11.1Bn invested in the sector across 190 deals. The average investment size continued to grow, reaching $62.2M vs. $56.8M in the previous quarter.
London and Michigan Center, MI, Nov 8th, 2021 - Ceridian (NYSE: CDAY; TSX: CDAY), a global leader in human capital management (HCM) technology, has entered into a definitive agreement to acquire substantially all the assets of DataFuzion HCM, Inc., a specialist enterprise workforce management and HCM integration solutions provider based in Michigan Center, MI. Venero Capital Advisors and Acquisitions Partners Group acted as joint financial advisers to DataFuzion.
WorkTech is going from strength to strength, with $12.9 billion invested into the sector last quarter across 230 transactions. Average investment size continues to increase, driven by major investments such as $1.5 billion into Articulate (online training) and $1 billion into Visma (core business software). M&A activity remained elevated, with 61 transactions being announced – a slight decline compared to the previous three quarters but still well above 2020 and even 2019 levels. Major transactions this quarter included Cegid's acquisition of Talentsoft, Blackstone's acquisition of Simplilearn and Veritone's acquisition of Pandologic. Median trading valuation for WorkTech businesses expanded to 10.9x, driven by the successful IPO’s of Freshworks and Paycor. The median trading multiple for Productivity vendors was volatile, impacted primarily by Zoom and the IPO of Monday.com.
London, 18 August 2021 - Venero Capital Advisors acted as sole financial advisor to CURO Compensation, a global leader in pay equity and compensation management technology, in its acquisition by Payscale, the leading provider of compensation data, software and services. Payscale is backed by two leading technology-focused private equity firms, Francisco Partners and Insight Partners.