Persol Asia Pacific, a Japanese HR behemoth, has purchased Singapore-based Workmate, an on-demand frontline staffing platform, for an eight-figure US dollar payment.
Following the agreement, Workmate will function independently of Persol.
According to reports, Workmate’s CEO and founder Matthew Ward said that Persol’s Asian reach, infrastructure, and expertise were the reasons his company decided to merge with it. Ward’s ambitions for faster development in new areas throughout the continent incorporate these resources. He emphasizes that more money will be required to pay for the company’s working capital as a result of this increase.
This month, the firm intends to begin operations in Singapore. By the first half of 2019, it plans to begin in Malaysia, then expand into Australia and New Zealand.
The HR tech company presently operates in Thailand and Indonesia and has a network of almost 500,000 pre-screened employees.
Workmate, a 2016 startup, serves as a digital contractor. The program links pre-screened labor with businesses using a custom AI-powered algorithm.
Additionally, the platform offers a full range of services, including worker payment processing and consumer invoicing. It primarily staffs businesses in the logistics, warehousing, food and beverage, and hospitality industries.
The HR-focused company Persol Holdings, which is traded on the Tokyo Stock Exchange, owns Persol Asia Pacific. It was successful in generating sales of $7.6 billion last year. Additionally, it has led and co-led investment rounds for Glints, a new startup employment platform.
Another reason Workmate sold to Persol was because of its expansion into new areas, which requires it to acquire several licenses in order to hire workers internationally. Hong Kong, Indonesia, Singapore, South Korea, the Philippines, Thailand, Malaysia, Vietnam, and Taiwan are already home to the Japanese company.
“For me, it’s about the amount of time, effort, and capital I have to raise to continue to grow independently, to set up offices and licenses. Or I can join forces with Persol.” Ward said. “It just enables us to accelerate more easily.”
He also thinks that, given the financing crunch and the firm’s expansion requirements, a purchase makes more sense than raising money.
The unstable post-Covid environment has increased the value of outsourcing companies like Workmate. The firm said that its sales nearly quadrupled to US $22 million in 2021 from US $12 million the previous year.
Ward said that the company’s activities in Indonesia and Thailand are lucrative. “The burn just comes from tech, product development, and regional investments we are doing in developing the platform,” he explained.
