Homebase Raises $71M for SMB Team Management Platform

The Growing Importance of SMBs in B2B Technology

In recent years, small and medium-sized enterprises (SMBs) have emerged as a significant opportunity within the B2B technology sector. A startup focused on providing tools for managing hourly workforces has just secured funding, highlighting the current state of this market.

Homebase Secures $71 Million in Series C Funding

Homebase, a platform designed to assist SMBs with managing their hourly employees, has successfully closed a $71 million Series C funding round. Sources indicate this valuation places the company between $500 million and $600 million.

Notable Investors Participate in the Round

The investment round features prominent names, reflecting both the high valuation placed on the SMB market by venture capitalists and the strategic interest of the individual participants. GGV Capital is leading the round, with contributions from existing investors including Bain Capital Ventures, Baseline Ventures, Bedrock, Cowboy Ventures, and Khosla Ventures.

Additionally, several individuals have participated, such as Focus Brands President Kat Cole, Jocelyn Mangan (board member at Papa John’s and Chownow, and former COO of Snag), Mike Dinsdale (former CFO of Gusto), Guild Education founder Rachel Carlson, athletes Jrue and Lauren Holiday, and actor Matthew McConaughey.

Total Funding Reaches $108 Million

To date, Homebase has raised a total of $108 million in funding.

Strong Growth Fuels Funding

This funding arrives following a period of substantial growth for Homebase. It is important to note that this company is distinct from the U.K./Irish home improvement retailer and the Vietnamese proptech startup sharing the same name.

Platform Usage and Services Offered

Currently, approximately 100,000 small businesses, representing a total of 1 million employees, utilize the Homebase platform. These businesses leverage Homebase to manage various aspects of their hourly workforce, including payroll, shift scheduling, time tracking, hiring, onboarding, communication, and HR compliance.

Future Plans for Expansion

John Waldmann, founder and CEO of Homebase, stated that the new funding will be allocated towards acquiring more customers and expanding the range of services offered. This expansion may include features tailored to frontline and service workers, as well as options for small businesses with both hourly and salaried employees.

Addressing an Underserved Market

Waldmann emphasized that the commonality among these diverse roles lies in the fact that they have historically been underserved by technology, particularly due to the complexities associated with hourly employment.

Inspired by Real-World Challenges

“Our core mission is to support local businesses and their teams,” he explained. This mission was inspired by his experiences with a childhood friend who managed a growing restaurant chain, grappling with manual processes, and his sister, who worked in hospitality and relied on manual timekeeping for accurate pay.

Focus on the Hourly Workforce

“Many tech companies concentrate on improving the work experience for desk-based employees, but there’s a need to develop tools specifically for hourly workers,” Waldmann noted. “The technological experience differs significantly for this segment of the workforce.”

North American Market Opportunity

Homebase is currently focused on the North American market, where there are approximately 5 million small businesses in the U.S. alone. The challenges faced by businesses during the COVID-19 pandemic have underscored the importance of efficient and organized workforce management.

Potential for New Services

The future will reveal what additional services Homebase integrates into its platform. The increasing sophistication of hourly wage workers and their unique needs suggest opportunities for innovation. The recent launch of payroll services, including pay advances, opens the door to further financial service offerings.

Industry Perspective on SMB Technology

“Small businesses are the cornerstone of the American economy, employing over 60% of Americans across 30 million businesses. In the post-pandemic landscape, technology is more crucial than ever for businesses of all sizes, including SMBs,” stated Jeff Richards, managing partner at GGV Capital and new Homebase board member.

“The Homebase team has dedicated years to bringing accessible technology to SMBs, driving profitability, improving hiring practices, and fostering growth. We are excited to support Homebase’s role in the recovery of American small businesses and contribute to its future success.”

Matthew McConaughey’s Investment

The involvement of Matthew McConaughey in this funding round is noteworthy, particularly given his recent foray into politics with plans to run for governor of Texas in 2022.

McConaughey’s Rationale for Investment

“The hardworking individuals who operate and work in restaurants and local businesses are vital to our communities,” McConaughey said. “They contribute significantly to the character and identity of our cities. This is why I’ve invested in Homebase. Homebase modernizes small business operations, empowering people across the country to work harder and smarter.”