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Is HR Tech a dark horse in the startup story in India?

By   /  September 24, 2016  /  Comments Off on Is HR Tech a dark horse in the startup story in India?

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Bengaluru:  Technology is an enabler in transforming HR practices while HR Tech itself scripting HR stories.  India has emerging as a hub of startup activities. In startup space, much has been talked on tech startups specially consumer, e-commerce, healthcare, etc. However, new story in the startup mission in India is emerging such as HR Tech.  A total of $65 mn has been invested in Indian HR Tech Companies in 2015 and 2016 (till now), as per Tracxn, a Bangalore based a startup intelligence and market research platform. The report mentioned that $49 mn was invested over 31 rounds in 2015 the peak funding for the sector, while only $16M has been invested this year.

In India HR tech company formation has grown each year from 2009 while over 200 startups founded in 2015. Investors are betting on this space as investor activity has been on the rise over the past three years, both in terms of funding and number of rounds. Five companies —Greythr, Aasaanjobs, Sheroes, Better Place, and Niyo Solutions have raised capitals this year.

The most surprising development is the M&A space where HR Tech sector has seen multiples  transactions. Tracxn’s HR Tech report September 2016 revealed that three acquisitions in this space this year  were the striking point.  The most prominent M & A deal is the acquisition of Bangalore-based job board Hiree by Quikr.  Indore’s Wag Mobile, a mobile first learning and training platform, was acquired by Edcast this year. Chennai-based KPIsoft, which provides a performance management solution, was acquired by Kresna Investments.

The report of Tracxn has also further analysed the most lucrative business models of HR Tech sector for investor community. The Employee sourcing (Sheroes, Aasaanjobs), HRMS (Greythr, ZingHR), and corporate training management (Capabiliti, MindTickle) have emerged as the leading business models by funding in India’s HR tech landscape.

 Also other sub-themes in the HR Tech also have been under the radar of investor community.  Challenge-based technical hiring (HackerRank, HackerEarth), blue collar jobs (Babajobs), gamified employee engagement solutions (MindTickle) are some of the top VC-backed business models in this space. Startups focused on background checks (IDfy, Better Place), recruiter marketplaces (PiQube, OnContract), and candidate databases (Belong) have also marked their presence felt in the sector.

Tracxn’s HR Tech India Landscape report also made profile presentations on the active investors in this space.  Blume Ventures (Belong, Greythr), Mumbai Angels (TalentBridge, DoSelect), Accel Partners (MindTickle, ZingHR) and 500 Startups (Sheroes, Capabiliti) are the most active investors in Indian HR tech companies.

 

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