Nowsta attracted venture capital for its approach to helping employers better engage with their hourly workforce in this increasingly hybrid work environment.
The company today announced $41 million in Series B funding in a round led by GreatPoint Ventures that brings the company’s total funding raised to date to $59 million. Joining GreatPoint in the funding were VMG Catalyst, Rally Ventures, Tribe Capital and existing investors Green Visor Capital, Compound Ventures and Clocktower Technology Ventures.
CEO Nick Lillios founded Nowsta in 2015 and spent the next year and a half building the technology that grew out of his experience working with food service providers in New York. The operational complexity of the hourly workforce was the inspiration for the company’s technology, a response to current workforce management solutions that haven’t been able to keep up with the changing nature of hourly work, he said.
Nowsta’s web and mobile app rolls workforce management tools like automated scheduling, time tracking, payroll and communication into a full-featured feature that includes an on-demand job marketplace that connects employers with a skilled pool. of trusted workers and outsourced service providers. There is also a wallet feature so users can get paid after each turn and see their future earnings.
“Every employer is taking advantage of a contingent workforce and trying to use 1,099 workers to fill the gaps,” Lillios told Ploonge. “Our marketplace matches employers with needs and employees, and you can see how they’ve been trained and evaluated so employers can make quick decisions.”
The company raised $8.1 million from Series A in April 2019, which gave it the impetus to create the market. When the global pandemic hit, Nowsta began working with clients who had to lay off their employees, and the feature allowed the company to help clients transition employees to other jobs.
Lillios doesn’t believe hourly work will return to normal. Instead, the change seen over the past two years will be permanent as more employees want flexibility and more employers have access to tools and resources that help them adapt.
A market that used to be low-tech is now teeming with startups catering to this underserved population. Most recently, we reported on AskNicely, which raised $32 million in Series B funding for its employee enablement app.
Others include Blink, an app for frontline workers to use and interact with the various IT services used by their organizations as well as each other. Shiftsmart, a marketplace that matches shift workers with employers, took in $95 million, while messaging app When I Work closed in a big round — $200 million. Meanwhile, Fountain raised $85 million and Seasoned raised $18.7 million for its restaurant employee tool. Earlier this year, we saw Homebase raise $71 million and Workiz, which focuses on home service professionals, raise $13 million.
Today, Nowsta’s technology manages more than 300,000 workers per month at 600 employers, including sports stadiums, hotels, food service providers and warehouses. As more stadiums and hotels reopened during the pandemic and needed to hire around 1,000 staff, Nowsta initially got hundreds of workers, which Lillios said some “revolutionized their business and ushered in a new flexible working model. ”
The new financing will allow the company to expand its operations into 25 new US markets, double its headcount from 68 people by the end of the year – it was 25 people in 2021 – and invest in product development, sales and marketing. After significantly increasing revenue in 2021, Lillios does not expect to repeat that, but it does predict the company will grow at least three to five times in revenue this year.
Ashok Krishnamurthi, managing partner at GreatPoint Ventures, said in a written statement: “The past two years have caused a paradigm shift in the job market, and hourly and flexible work is becoming increasingly prevalent. Companies of all types must now easily connect and efficiently manage their on-demand workforces. The most effective way to do this is with Nowsta, and we couldn’t be more excited to partner with Nick and the team to help achieve this vision.”