Less than a fortnight after SoftBank round, HRTech Gupy acquires competitor Kenoby

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Less than two weeks after raising a $92 million round led by SoftBank and Riverwood, Brazil-based HRTech Gupy is back in the spotlight. Today (9), the company announced the acquisition of its main rival, Kenoby, for an undisclosed amount. 

Kenoby’s 100-strong workforce will merge with the Gupy team, and the acquired company’s product will cease to exist under its original name. Founded in 2015, Kenoby raised $4,6 million in debt in a round led by the  Brasil Venture Debt fund in 2019. In the following year, it raised a $4,7 million round led by Astella Investimentos.

This is Gupy’s second acquisition. In October, the company began to offer staff training services after buying corporate education startup Niduu. 

The purchase is part of Gupy’s market consolidation strategy, aimed at creating an end-to-end digital offering for human resources departments. “HR [departments] need consolidation. Customers love this. It is much easier to have a single supplier”, said Mariana Dias, president and co-founder at Gupy, in an interview with Startups last month.

With the incorporation of Kenoby, Gupy now has a consolidated portfolio of over 2,300 customers and a user base of 36 million. The firm expects to post new 80,000 job vacancies monthly on its platform in 2022. In addition, Gupy wants to grow its headcount from 600 to 700 employees by the end of the year.

In terms of financial performance, the company wants to double its revenue: although Gupy doesn’t reveal numbers, sources told Startups the company now compares to RD Station when it was purchased by enterprise software firm Totvs. At the time, RD had an estimated revenue of approximately $40 million.

Net dollar retention at Gupy currently sits at around 120% – meaning that even if the company doesn’t close any new sales outside of its current client base, it will still grow by 20%. At 5%, customer retention at the startup is significantly higher than the software-as-a-service (SaaS) market overall, which is around 1%. “Investment funds told us that we are the fastest growing SaaS company in Brazil. We think we are among the top three,” Dias said, when Gupy announced the SoftBank round.

(translation by Gabriela Del Carmen, editing by Angelica Mari)