News
Global HR Tech Report Q1 2024: Strong market traction with appealing outlook for 2024

- approximately 200 transactions in Q4 2023,
- more than $3.5 billion total invested capital in the period,
- an expected $28.8 billion global HR Tech market volume for 2024 and
- +13.4 % expected market growth CAGR until 2027.

Sources: 1) Korn Ferry: Future of Work – The global talent crunch, (2018) (illustrative); 2) European Centre for the Development of Vocational Training, (2021); 3) McKinsey: European talent is ready to walk out the door. How should companies respond? (2022); 4) Gartner Research: 2024 HR Technology Imperatives (2023)
Present market developments cause a shift for the role of HR from a traditional administrative function to a new strategic responsibility and HR initiatives that impact the entire business, such as hybrid working environments, learning and development, and employee experience. This forces HR departments to balance the delivery of business benefits with the associated costs to achieve optimum business value and maintain their competitive edge.

Sources: Pitchbook, Research and Markets, Gartner, DS Research
In 2023, strategic buyers contributed more than half of the entire M&A activity in HR Tech, driven by efforts to offer holistic platform HR solutions to provide end-to-end digitalization of the HR function. Around two thirds of invested primary capital were allocated to later stage venture funding rounds, as investors are increasingly looking for more mature assets with a clear path to profitability.
Ralf Philipp Hofmann, Managing Partner, Member of the Global Executive Committee and Co-Founder of Drake Star notes: “These observations are something we clearly notice in our daily work – and we’ve been noticing it for a while. The recent transactions we successfully worked on in HR Tech include VEDA GmbH's majority recapitalization with Investcorp, the strategic sale of Persis GmbH to proALPHA, aconso’s majority recapitalization with Keensight Capital, and ECM Equity Capital Management’s partnership investment in ONE HIRING and all of them prove that the interest of investors in high-quality, profitable and well-managed companies remains very high.”
For more insights, key stats and charts, most active investors, and a market map of key players in the HR Tech sector download the full report below:
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Biography
Managing Partner, Member of the Executive Committee
HR Tech
Digital Services
Software/SaaS
Munich
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