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Brooklyn-headquartered Nowsta, which provides a cloud-based workforce management platform to enterprises, today announced it has raised $41 million Series B funding from GreatPoint Ventures. The company plans to use the capital to increase its market presence in the U.S., grow its team twofold, and further improve its platform offerings.
For any enterprise operating on a large scale, handling workers is a major challenge. A staff manager has to keep track of hundreds of hourly, gig, and shift employees, analyze their work schedules and hours given — and assign projects and process payments accordingly. With complete communication and coordination, the whole effort takes about 30 to 50 hours every week.
Nowsta’s AI-driven workforce management platform
Founded in 2016 by Moo Kim and Nick Lillios, Nowsta solves these challenges by bringing all features critical to staff management under a single workforce management platform.
The solution offers an on-demand labor marketplace that connects employers to a skilled pool of workers (via third-party contingent staffing providers) and combines it with tools that automate and streamline people operations, such as employee scheduling, time tracking, team communications, and payroll reporting & analytics.
“We leverage machine learning algorithms for our job recommendation engine and our automated scheduling tool, helping match employees with the right opportunities, and determining the best worker scheduling configurations,” Lillios, who is also the CEO of the company, told VentureBeat.
This way, companies using Nowsta can build, manage, deploy, and pay a hybrid workforce, composed of both direct hires and flex or contingent workers. It performs the same business task that previously took 30 to 50 hours every week in just 25 to 30 minutes.
Employees, meanwhile, get an easy way (Android/iOS app) to see open shifts, respond to job offers, organize new and existing jobs, and access their paycheck the moment they clock out of their shift, instead of having to wait until the end of the payroll cycle.
“Employers are struggling to grapple with the complexities associated with finding and managing hourly workers, and the pandemic has only served to exacerbate these challenges. We’re redefining the way employers think about and approach workforce management, by giving them the tools they need to provide their employees with a more empowered and engaging work experience,” Lillios said.
While the pandemic slowed the business for a bit, the company claims to have recovered. In all, it said more than 600 enterprises — from stadiums and hotels to food service vendors and warehouses — use Nowsta to manage over 300,000 workers every month.
The idea of providing automated tools for workforce management makes sense, but Nowsta is not the only player operating in this area. SaaS players such as Bamboo HR, Rippling, and Workforce Software also provide similar solutions. However, the CEO says these players aren’t the biggest challenge, it is the old-school ways of managing and coordinating a large workforce — pen and paper, email, Excel, etc.
“We’re providing employers with the tools they need to transform into on-demand, flex workforces,” he said. “We connect employers with contingent workers quicker and more efficiently than traditional staffing methods, by leveraging our network of third-party staffing providers.”
Moving ahead, the CEO plans to deploy the fresh round of funding, which also saw participation from VMG Catalyst, Rally Ventures, Tribe Capital, and multiple existing investors, to scale the solution. As part of this, the company will take the product to 25 new markets within the U.S. and improve its offerings with more capabilities.
“We will continue to build out and improve automated employee scheduling, especially for contingent and workforces, and begin to offer new products to help financially empower employees, including a debit card product and income smoothing tools,” he said.
According to Research and Markets, the global workforce management software market was valued at $7.03 billion in 2020 and is expected to reach $9.93 billion by 2026, with a growth of over 6%.
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