HR Tech is thriving, with 650+ transactions and $22.3bn in disclosed capital invested globally in 2025 YTD. Many of the big players are highly active, marked by mega-deals from industry leaders like Paychex, Workday and SAP. This surge is driven by rising demand for AI-powered platforms and the urgent need for companies to close workforce skills gaps at scale. Our new Global HR Tech Report analyses this momentum and examines how AI and skills management are shaping the future of work.
Q&A with an industry expert: Workday’s Markus Kammermeier shares insights
For some first-hand insights, we sat down with Markus Kammermeier, Lead Strategic Advisor at Workday. Workday is embedding AI directly into its core platform to deliver immediate value for customers, from reducing HR ticket volumes with Workday Assistant to improving internal mobility through Workday Skills Cloud. For new clients, standalone AI solutions like Evisort provide quick efficiency gains without a full platform rollout. Looking ahead, Workday sees agentic AI as transformational – enabling entirely new ways of working, governed by its Agent System of Record to ensure compliance and trust.
According to Markus, the future of HR Tech will be shaped by three major trends. To discover all of them, read the industry Q&A with him on page 10 of the report.
HR Tech M&A and Private Placement Activity
HR Tech M&A has been on a steady climb – Q2 2025 saw 83 transactions, with the standout being Paychex’s $4.1B acquisition of Paycor.
On the funding side, 158 private placements were recorded in 2025, with Rippling’s impressive $460M Series G leading the way, backed by Elad Gil, GIC, and Goldman Sachs.
The adoption of AI and a shift towards required skills defines HR Technology trends for 2025
The workforce is changing fast – and so are the skills needed to stay competitive. Six in ten workers will require additional training before 2027. 70% of company leaders say skills gaps are already hurting business performance. To stay ahead, companies should: Identify skills gaps early, invest in upskilling and reskilling through tech-enabled training, prioritize soft skills that can’t be easily replaced by technology and assess talent based on capabilities, not just traditional qualifications.
However, there are several areas of focus and pain points for implementing new HR technologies, including a mismatch between AI readiness & AI’s strategic value, driving employee retention with innovative L&D solutions as well as employees demanding practical self-service features.
Download the full report below including an overview of the latest deals in the sector, market figures for talent acquisition, human capital management and talent management, a detailed market map, and many other insights put together by our global team of experts:
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