In a move that underscores the competition in the HR services sector, HiBob is acquiring U.K.-based payroll provider Pento for $40 million. The acquisition is noteworthy not because of its size, but because it represents a clear signal that the HR platform market continues to evolve and attract investment.
HiBob, an HR services platform, has raised nearly $600 million since its founding in 2015. It is part of a generation of HR platforms that emerged during a period of rapid HR SaaS market expansion, such as Rippling, which was founded in 2016 and has raised $1.2 billion, and Lattice, also founded in 2015, which has raised more than $330 million.
Other HiBob competitors include BambooHR, Ceridian Dayforce, UKG, ADP Workforce Now and, to a lesser degree, Workday and SAP SuccessFactors, according to Josh Bersin, an HR analyst and founder of the Josh Bersin Company.
Pento, based in the U.K., reports processing last year approximately $3.6 billion in payroll for about 400 U.K. customers.
The planned Pento acquisition "shows that HiBob is now entering the payroll market, which is a natural extension for a highly successful HCM platform company," Bersin said.
Ronni Zehavi, CEO and co-founder of HiBob, said in an email that users in the U.K. "can expect positive changes and an improved overall employee experience with the option for integrated payroll and HR services." The vendor plans to have an integrated payroll and HCM product early this year.
Pento's customers can continue using their current services without any disruption.
Ronni ZehaviCEO and co-founder, HiBob
"This integration will bring significant enhancements to HR software, freeing up HR teams' time for higher-value tasks and maximizing operational efficiency," Zehavi said.
Bersin noted that HiBob's advantage is a highly functional and scalable system that's easy to administer and use. "It can be managed by an HR manager, finance manager or business manager -- [it] requires no real IT support whatsoever," he said, adding that his own firm uses the system.
Zehavi assured that "Pento's customers can continue using their current services without any disruption."
The integrations that Pento has with other human resources information systems will remain unaffected, he said. "Pento's offering will remain uninterrupted for the foreseeable future, and over time will seamlessly be integrated into HiBob's platform."
Patrick Thibodeau covers HCM and ERP technologies for TechTarget Editorial. He's worked for more than two decades as an enterprise IT reporter.
