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SOFTWARE (NON-INTERNET/MOBILE) | Compliance
curocomp.com

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Founded Year

2009

Stage

Acquired | Acquired

Total Raised

$2.74M

About Curo Compensation

Curo Compensation is the developer of a configurable and scalable compensation management software solution called CuroComp, which enables customers to manage their pay review cycle quickly and securely, in accordance with agreed compensation plans.On August 18, 2021, Curo Compensation was acquired by PayScale. The terms of the transaction were not disclosed.

Curo Compensation Headquarter Location

Exchange Tower, 19 Canning Street

Edinburgh, Scotland, EH3 8EH,

United Kingdom

+44 20 7300 7221

Latest Curo Compensation News

HR capital deals and how they might impact you as a customer

Aug 20, 2021

Dyslexia mode Traveling round the Monopoly board of HCM firms via the bank. What’s an HR vendor got to do to get acquired or raise lots of capital? Apparently, not much given the spat of recent deals. Here’s a sampling of recent structural HR events with a note of caution to HR tech buyers/users. Compensation technology is red hot now There was a lot of activity in the compensation management space lately. Let’s first look at the deal by Payscale to acquire Curo. I wrote in Jan 2019 about CURO Compensation and compensation management. In that pre-pandemic world, I mentioned the way firms were failing to win the war for talent – a problem that’s materially worse today. Pay inequities only add fuel to the resignation wave in effect now. Smart employers will want to remove any potential points of friction between their firm and their workforce if they want to control unplanned attrition. CuroComp intrigued me in 2019 because: But the thing that really caught my attention were the large, substantial customers they’ve acquired (e.g., Virgin Atlantic, Panda Restaurant Group, EY, etc.). If they can maintain momentum and continue to attract big logos, they’ll become a major irritant to many HCM vendors. The U.S. and Canada markets are their new expansion targets. This week Payscale, a big-time provider of compensation data announced it is acquiring CURO Compensation. The firm published a letter to customers that does a great job of explaining the business rationale for this deal. This deal puts lots of compensation data together with pay equity technology. Francisco Partners and Insight Partners are the key investors behind Payscale. Francisco has been involved with numerous software firms including ERP vendor Plex. Insight’s HR technology investments are material, too. They’ve had stakes in Meta4, Zenefits, Virgin Pulse, Smart Recruiters, Papaya Global and more. How relevant is this deal? According to the announcement: Together, the combined company has become one of the largest providers of its kind in North America to help job seekers, employees and businesses get pay right. Payscale currently has 10,000 customers, including 53% of the Fortune 500, and prices 27 million jobs annually with $1.4 trillion in value across 198 countries. Pave’s $400 million valuation And, the compensation space action continues… As companies progress from one capital financing round to another, founders (and early investors) are hopeful that the firm’s valuation is growing at an outsized rate. That’s why a Series A round for a startup might imply a $10 million valuation and the Series B round that follows might be in the $40 million range. HR compensation solution Pave, got a $400 million valuation with their recent Series B round. That round raised $46 million in capital for the firm. According to their recent press release : Pave, the leading compensation technology platform, announced today that it has raised $46 million in Series B funding led by the YC Continuity Fund and has welcomed Ali Rowghani to its board. The round also includes participation from existing investors Andreessen Horowitz, Bessemer Venture Partners and others. Pave integrates directly with customers’ HR and equity systems so that customers have access to real-time compensation data and never have to use spreadsheets for compensation surveys, merit cycles, or total rewards statements again. The financing coincides with the company making its real-time compensation tool available for free. My clients frequently want insight into compensation as it helps with the annual performance management, salary administration, planning and other functions. However, these same clients have real challenges with many of the tools/databases/services out in the market today. First, what one information provider calls an Accounts Payable Manager might be an A/P Supervisor, Accounting Manager, etc. in the employer’s firm. Second, the database might not have enough data points for a particular role in a given geography (i.e., an A/P Supervisor may command a high compensation in Silicon Valley versus Omaha, Nebraska). For many HR organizations, salary reviews are only done annually with most attention paid to positions that are in abundance within a firm (i.e., the focus will be on the 2,400 call center specialists not the two people in Fixed Asset Accounting). Pave’s Silicon Valley roots and focus are apparent. Just check out the HRMS technologies they connect to already: The Pave suite integrates with dozens of ATS, HRIS, and equity management tools, including Greenhouse, TriNet, BambooHR, Namely, Lever, ADP, Workday, Jobvite, Shareworks, Rippling, Justworks, Paylocity, Sapling, UltiPro, Carta, and E-Trade. Also, their comp tools consider equity components (e.g., stock options) not just salary. Kudos to the team for getting a $400 million valuation – now, you have to focus on getting a $1 billion (i.e., unicorn) valuation next! CloudPay does a big capital round Payroll provider, CloudPay, announced today that it raised $58 Million to further its global ambitions and to deepen product functionality. No information was provided as to the imputed valuation this creates for the company. CloudPay’s growth of late has been notable and likely fueled by the desire of more companies to consolidate their global payrolls into a smaller, more integrated portfolio of payroll providers. It’s not uncommon to find within my client base firms having 1 or more different payroll service providers in each country where they have staff. In some countries, these firms use local accountancies to provide payroll services and/or larger payroll providers in other locations. The uneven nature of what each payroll provider offers creates a lot work and inefficiency for the employer. For example, some in-country providers only calculate gross-to-net amounts and leave the tax/regulatory filings for the customer to figure out. My clients generally want (but seldom get): One throat to choke re: all payroll processing A complete solution in each country No surprises from a tax, legal and regulatory perspective One interface to pass employee time to payrolls regardless of where the employee works Fully automated and correct Payroll to General Ledger integrations Etc. The announcement also hinted that the firm will add additional/deeper treasury management capabilities along with its expanding global support. Material changes of control re: HR tech firms Cornerstone OnDemand - HR & LMS vendor Cornerstone OnDemand (CSOD) just went private with help from private equity firm Clearlake Capital Group. The deal appears to be valued around $5.2 billion (USD). This is an interesting deal considering that CSOD bought rival SABA in the Spring of 2020 for $1.3-1.4 billion. Very little about this deal has been written. I did offer up some of my thoughts on the deal in a recent TechTarget piece. I recommend you read that piece as it also includes commentary from respected HR industry analysts Josh Bersin and Holger Mueller. Here’s the link . First Advantage - First Advantage (NASDAQ: FA) is a publicly traded firm as of late June 2021 with a valuation today of approximately $3.58 billion (source: Yahoo Finance). The company expects annual revenues in the $640-650 million (USD) range. First Advantage provides a number of verification services for employers. One key thing to note: top-line revenue growth (year-over-year) appears to have grown >60%. Alight - Okay, you might need an MBA and a genealogy background to comprehend this one. HR consultancy and process outsourcer, Alight, was acquired last month by a SPAC, a special purpose acquisition company. The deal has been valued by some as worth $7.3 billion (USD). While technically this is an acquisition, it really represents a vehicle to provide a liquid market to trade Alight shares. Alight Solutions, a leading cloud-based provider of integrated digital human capital and business solutions, and Foley Trasimene Acquisition Corp. (NYSE:WPF) (“Foley Trasimene”), a special purpose acquisition company, today announced the completion of their business combination, which was approved by Foley Trasimene stockholders on June 30, 2021 and closed on July 2, 2021. And, because the Foley SPAC was publicly traded, the newly merged Foley/Alight entity is now publicly traded on the NYSE. Who is Alight? The company defines itself thus: Alight Solutions is a leading cloud-based provider of integrated digital human capital and business solutions. Leveraging proprietary AI and data analytics, Alight optimizes business process as a service (BPaaS) to deliver superior outcomes for employees and employers across a comprehensive portfolio of services. Alight allows employees to enrich their health, wealth and work while enabling global organizations to achieve a high-performance culture. Alight’s 15,000 dedicated colleagues serve more than 30 million employees and family members. We’ve covered Alight and its component firms for years. I attempted to plumb the genealogy of Alight and NGA HR, a firm Alight bought in 2019 in this August 2019 diginomica analysis . You really should scan that piece as it will really paint a story in how a tech firm can experience many different changes in ownership over several decades of its existence. I did get a chance to put a couple of questions before an Alight executive regarding the Foley deal. Here is our exchange: BS - Alight’s not just one thing. It has consulting and outsourcing service lines as well as the NGA HR business and other service lines. It also did a deal a couple of years ago re: the CSOD/WDAY practice of Wipro. So, how is a potential Alight client supposed to look at the firm? What’s the ideal customer profile now? In short, who/what is Alight? Alight - Alight doesn’t really have pure play competitors – no one does everything that we do in the human capital and financial space. To help address this highly fragmented space, we’ve developed the only integrated, end-to-end platform – Alight Worklife – across health and wealth benefits and global payroll. Clients that would benefit most from this platform are large, multinational companies; those who need integrated systems, tools and technologies that maximize the value of employer-provided benefits and improve employee outcomes. Alight is installed with 70% of the Fortune 100 and 50% of the Fortune 500, and we will soon manage retirement plan recordkeeping for the largest employer in the U.S.—the federal government. Now that we’re better capitalized, the two biggest areas of investment are: Commercial infrastructure – we’re adding more value engineers and solution architects who are working directly with clients and C-suite execs to fix those fragmented systems R&D and engineering – we’re hiring hundreds of engineers working on the health, wealth and payroll clouds that we’ve launched this year   BS - Alight’s undergone a couple of material changes of control in recent years: Blackstone, the Foley SPAC and being part of AON just 4 years ago. Software buyers get edgy when their vendor gets acquired. What assurances & steps will Alight make now to help customers see a new era of stability with Alight? Alight - This was the right time for us to go public, and the right structure for us to use. Partnering with Bill Foley and going public enables us to invest in our business to accelerate our growth strategy, bring new products and solutions faster, and to capture new market opportunities. With our technology transformation and transition to a Business Process as a Service (BPaaS) model, bookings are accelerating and we expect faster growth to follow in a few areas: Strong recurring revenue and cash flow from our installed base, plus margin upside from shift to BPaaS. Continue to execute on M&A where we have been successful – e.g., NGA HR. About 10% of Alight’s business is from outside the U.S., and that’s the target for a lot of our future growth. Mammoth and ThinkHR - Around July 2019, I reported on the nuptials between Mammoth and ThinkHR . I recently got a quick update from the team there. The combined firm is now being marketed under the Mineral brand. You can see more re: their offerings and branded capabilities here . BTW – their branding also includes this new goal for the firm: To help our partner’s clients fully and consistently close the HR & compliance gap, reducing their risks and helping them achieve organizational health and resilience. Mineral may be one of the largest and widest used HR services out there that few people know by name. Why? Mineral’s raison d'être is providing all kinds of advice, insight, etc. to firms and help them meet the overwhelming number of changing regulations, rules, etc. in the HR space. The firm counts over 500,000 employers as customers today (up from around 350,000 when they merged in mid-2019). Mineral’s low-key presence may be due in part to its solutions being incorporated into the offerings of so many HRMS products and insurance services. These can be white-label/private-label versions of the Mineral products/knowledge solutions. The company’s offerings are likely very popular these days as HR professionals (and other business leaders) struggle to process constantly shifting legal, regulatory, tax and other requirements that only increased in frequency with the pandemic. In this vaccine economy, businesses have tons of questions re: Will an employee’s work from home request create new tax nexus issues for the company? Who can be laid off because of COVID and when? Are vaccine mandates legal in specific locales? What is the right way to determine who to rehire first? Can employers raise pay rates to attract new hires but keep existing employee pay at its current rates? Etc. Solutions like Mineral are especially valuable for SMB firms. These companies simply can’t afford the large HR teams and specialists that larger firms can nor can they maintain a bench of payroll, tax, regulatory, etc. experts to respond to their inquiries. An on-demand service and/or a database with key guidance is more cost-effective. The big news this time may be the proactive nature of Mineral’s solutions now. The technology now anticipates what businesses need to know (or act on) instead of waiting for businesses to reach out to Mineral. A new platform, curated advice and technologies are powering this. My take These are only some of the structural HR stories this month. But, beyond the headlines, frothy valuations and new owners, software buyers/users need to ponder some key questions. You should be thinking: With a change in ownership, will we see a change in leadership with our software vendor? Will this affect the product roadmap? If the vendor’s revenue no longer supports an outsized valuation, will shareholders demand management dramatically cut costs, cut headcount, etc.? Or, will shareholders expect management to raise prices and adversely affect the original economics of our relationship with the vendor? Will the presence of private equity owners/investors mean additional change of control events are likely in the near future? How should we manage this possibility? How do we benefit from this? Etc.

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