pequity Raises $19M to Revolutionize Equitable Compensation

The Growing Importance of Diversity and Inclusion in the Workplace

Currently, diversity and inclusion are paramount concerns within professional environments. Effective improvement in these areas necessitates a comprehensive strategy, encompassing both product development and the recruitment and management of a diverse and inclusive workforce. Pequity, a recently funded startup focused on equitable compensation, exemplifies this trend and demonstrates the increasing demand for technology-driven solutions.

Pequity Secures Series A Funding

The San Francisco-based company, Pequity, has successfully raised $19 million in a Series A funding round, spearheaded by Norwest Venture Partners. Additional participation came from First Round Capital, Designer Fund, and Scribble Ventures. These funds will be allocated to continued product development and expansion of the team, with plans to double the current headcount of 20 by year-end, following positive market feedback.

Rapid Customer Acquisition and Market Focus

Since its official launch last year, Pequity has onboarded over 100 clients. The company initially targeted rapidly growing businesses, particularly within the technology sector, reflecting the heightened focus on D&I within the industry. Notable clients include Instacart, Scale.ai, and ClearCo. The platform has facilitated over 5,000 job offers in the past four months.

The Genesis of Pequity: A Personal Experience

Kaitlyn Knopp, CEO and co-founder alongside Warren Lebovics, conceived the idea for Pequity based on her own professional experiences. She observed shortcomings in existing tools while working in employment compensation.

Identifying the Limitations of Existing Compensation Tools

Knopp previously held positions at Google, Instacart, and Cruise, spending a decade in the Bay Area’s compensation landscape. During this time, she found that many existing tools were inadequate and “clunky” when it came to comprehensive compensation analysis.

Pequity's Unique Approach to Compensation Analysis

“Existing platforms often treated compensation as a secondary feature, rather than a core focus,” Knopp explained. “They were typically part of a broader ‘CRM for candidates’ system, requiring significant manual input and custom analytics.”

Addressing a Gap in the Market

She further noted that larger tech companies often developed their own internal tools, leaving smaller businesses at a disadvantage. These siloed tools also lacked the benefit of broader market insights. “Our goal was to specialize in this process and take complete ownership of it.”

How the Pequity Platform Functions

The Pequity product integrates with existing HR systems – HRIS, ATS, and payroll – to analyze and compare salaries across an organization. It combines internal data with broader market data, including industry benchmarks and trends, to provide actionable insights for HR teams.

Empowering Data-Driven Compensation Decisions

This integration enables HR teams to make more informed and transparent decisions, a key step towards equitable compensation practices. The platform is specifically designed to measure compensation fairness across teams.

A Mission-Driven Approach to Compensation

Knopp also aimed to create a product with a clear mission: to provide a platform that facilitates transparent and equitable decision-making through data-driven insights.

Proactive Identification of Compensation Issues

“Many compensation tools are reactive, addressing issues only during pay equity tests or performance reviews,” she stated. “Pequity proactively flags potential issues through its analytics, providing alerts before decisions are finalized.”

Expanding Access to Compensation Information

Knopp envisions a future where the tool is accessible not only to HR professionals but also to managers and employees, fostering greater understanding of compensation logic and empowering informed negotiations.

The Potential of Modernized Compensation Solutions

The success of innovative platforms like Pequity will demonstrate whether a new approach can gain traction in the market. If addressing diversity and inclusion is a priority for HR, and current tools are inadequate, increased adoption of new solutions seems likely.

Norwest Venture Partners' Perspective

“Compensation is a critical reflection of a company’s values, impacts its ability to attract talent, and represents a significant expense,” said Parker Barrile, Partner at Norwest. “Pequity empowers compensation teams to manage equitable programs using modern software designed by compensation experts.”