Gusto, a US-based human resources technology provider backed by internet and technology conglomerate Alphabet, raised $200m yesterday in a series D round led by financial services and investment group Fidelity Management and Research.
Generation Investment Management, Dragoneer Investment Group, General Catalyst and funds advised by T. Rowe Price Associates also took part in the round, which valued Gusto at $3.8bn according to Forbes.
Formerly known as ZenPayroll, Gusto has built a cloud-based platform that helps small businesses manage payroll and employee benefits such as pension contributions and health coverage. It also includes team management functionality and self-onboarding tools for new staff members.
The company has signed up more than 100,000 clients across the US. It will use the capital for research and development with a focus on fintech, to improve a feature that enables employees to collect wages early without affecting company cashflow. The cash will also allow Gusto to increase its headcount.
Anne Raimondi, chief customer officer at Guru, a US-based provider of sales advice software backed by workplace collaboration platform developer Slack, has joined Gusto’s board of directors.
CapitalG, the growth-stage investment vehicle operated by Alphabet, participated in the company’s last round, a $140m series C round in August 2018 that valued it at approximately $2bn.
The series C round also featured MSD Capital, Dragoneer, Y Combinator Continuity Fund, General Catalyst, Kleiner Perkins Caufield and Byers (KPCB), 137 Ventures, Emergence Capital and portfolios managed by T. Rowe Price.
CapitalG and General Catalyst had previously supplied $50m in series B-1 funding for Gusto in December 2015, eight months after the former had led a $60m series B round that included General Catalyst, Emergence Capital, Ribbit Capital and KPCB.
KPCB and General Catalyst had already provided $20m in series A funding for the company in 2014. GV, an early-stage corporate venturing subsidiary of Alphabet, had backed its $6.1m seed round in 2012 together with enterprise software producer Salesforce and a range of private investors.
