HR software companies are making billions from American companies

It seems a new HR technology company starts up every day – and some are making billions of dollars as companies embrace software as a service

HR software companies are making billions from American companies
HR software is becoming an increasingly lucrative market, it seems.

Kronos has become one of the first HR technology companies to pass $1billion in annual revenue, it announced this month. But it stands tall amongst a bevy of small startups vying for attention from both investors and enterprises.

PeopleDoc, which makes software for document management, recently raised $17.5million in a second round of funding, counting Motorola and Starbucks as customers. Meanwhile, payroll and benefits technology company Zenefits announced $15million in funding in January, and startup Intellinote announced $4.3million in fresh cash.

And many HR software companies are having a ball on the stock market: in the less than two months since TriNet floated, its price has risen from $16 to nearly $24.50. The HR outsourcing group saw revenue above $1.6billion in 2013. HR SaaS company Paycom is looking to follow suit on the New York Stock Exchange. However, California-based software company Workday has seen its price fall from $109.92 in February to just over $70 today. Still, the stock market has been a successful venture for the company: its price at IPO was just $28.

In response to Kronos’ announcement that it has grown beyond $1billion in revenue, CEO Aron Ain said he was “delighted”, claiming stake as “the first vendor to do so in the workforce management market”.

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