Provo, Utah-based Awardco today announced it has landed a $65 million Series A round of funding, an amount the company claims ranks as the largest Series A funding ever in the HR Software-as-a-Service marketplace.
The funding was led by mega-VC firm, General Catalyst, and Ryan Smith, Qualtrics co-founder and Utah Jazz majority owner.
Awardco is an employee rewards and recognition company that is disrupting this industry, in part, because of its partnership with Amazon Business.
Through this partnership, Awardco allows the employees of its clients to
- Earn points for their performance,
- Use those points to select the award she/he wants, and,
- Have that product/award delivered to them, sometimes as quickly as the same day.
"We're the marketplace of all marketplaces (because of our relationship with Amazon)," said Awardco Founder and CEO, Stephen Sonnenberg. "We re-skinned Amazon to be inside of Awardco, (and as a result we) provide dollar-for-dollar value and near-limitless reward choice for customers."
According to Sonnenberg, Awardco currently supports over 3 million employees working for 1,000-plus companies in over from in 141 countries.
Among its clients are companies like Cornell University, Hertz, Texas Roadhouse, and Zillow, with over 9 million employee "recognitions" (aka, awards) parsed out in the past year.
Why Take the Money Now?
During my 45-minute conversation with Sonnenberg last week, I asked him why take outside investment monies now, some nine years after the company was funded.
He explained that, in fact, Awardco had previously taken in $5 million investment monies some 18 months ago from Smith, Todd Pedersen (Vivint Smart Home Founder and CEO), and Alex Dunn (Co-Founder of Vivint Solar and former President of Vivint Smart Home).
"We have been focused on growth, keeping our heads down. And we don't need the money, Sonnenberg explained."
In fact, the Awardco news release explains that the company has been cash-flow positive since year one.
Nevertheless, being an entrepreneur is hard, Sonnenberg said. "So we wanted to be able to enjoy the journey a little bit more than we were. But it (the funding) allows us to level up. So we're gonna grow our engineering team and grow globally."
Sonnenberg also shared that the ability to work with General Catalyst and its Managing Partner, Paul Kwan, was a real positive for him.
"Awardco has scaled an impressive enterprise software business while bootstrapping it from the ground up," Kwan said. "This is particularly rare in today's marketplace where the prevailing mentality is often growth at any cost. Awardco's DNA is reminiscent of Atlassian and Qualtrics, two other bootstrapped companies that I have had the privilege to work with."
According to the company announcement, Awardco has been doubling its size and revenue annually. It currently has over 250 employees.