Flash beneficial properties muscle and enters one other billionaire HR phase
After getting under control of expenses, Flash now creates a business unit that will have a SaaS platform for HR, increasing the startup’s addressable market by over BRL 10 billion
Jan Christian and Rudy Tarasantchi were two executives at the Afya education group when they decided to come together to create a startup that solved a pain that the duo saw in several companies they worked for: an HR platform that had a single login, without the need to consult several systems.
In the search for investors who would support the idea, Christian and Tarasantchi went knocking on the door of GFC, which liked the project. But, instead of a contribution, he suggested a conversation with Flash, a flexible benefits startup of which the American manager was part of the shareholder base.
It is from this connection that Flash People is being born, a new Flash business unit that will be led by Christian and Tarasantchi – the first as general director and the second as technology director. It is a SaaS platform (Software as a Service) for HR that increases Flash’s addressable market by up to an additional R$10 billion.
“It was not an easy decision,” says Christian, exclusively to NeoFeed🇧🇷 “We were sure that we would not follow this path, but they had a good structure, prepared and with a vision very similar to ours. And let’s start within one platform.”
Flash People is Flash’s third pillar in the HR area. The startup started working with flexible benefits, competing with market giants like Alelo, Sodexo and Ticket. But, little by little, it extended its tentacles to other areas within the universe of human resources.
The first foray beyond the benefits was the purchase of ExpenseOn, in July this year, which marked the entry of Flash into the corporate expenses area, an offer that includes a card together with a platform in the SaaS model to manage expenses .
Now, Flash enters a wider terrain, in which it will face from traditional ERP companies, companies specialized in HR software and Brazilian and international startups that also want a piece of this market estimated at US$ 24 billion in the world in 2022, according to to Fortune Business Insight.
“We had been planning to enter this area for some time, as we saw a monstrous opportunity. But we didn’t have, at that moment, the capacity to execute”, says Ricardo Salem, founder and CEO of Flash, to NeoFeed🇧🇷 “Christian and Tarasantchi showed up and we accelerated the plans.”
The new business unit is born with 40 people, who work separately from Flash. In just four months, the platform went from zero to the four modules being launched this week: hiring, engagement, training and people analytics.
The project was accelerated because Christian and Tarasantchi were already in the field doing research for the development of the platform and they were already putting together a development team, which was integrated into Flash.
Asked if, by incorporating the duo’s project, Flash was not making an acqui-hirer, a term to refer to an acquisition whose main objective is to recruit its professionals, Salem does not see it that way.
“They are two executives, with exceptional execution capacity”, says Salem. “And they had a team that was committed. This is the only way we managed to move from zero to a four-module platform in four months.”
Throughout 2023, new modules will be launched by Flash People. Performance, shift control and recruitment modules are already planned. The cost will be a monthly fee of R$ 19.90 per employee. The plan is also to offer add-onswhich may be charged separately.
Six companies, whose names are not disclosed, are testing the platform. From now on, the intention is to open the system to the open sea, but not so much. In this beginning, Flash People must fish in Flash’s aquarium.
Founded in mid-2019 by Salem and brothers Pedro and Guilherme Lane, Flash has raised $130 million from investors including Tencent, monashees, Tiger Global, Battery Ventures, Whale Rock Capital Management and, of course, GFC.
Currently, it already has more than 15,000 customers of different sizes and has a base of hundreds of thousands of employees (the startup does not disclose the exact number). The projection is that the new HR solution exceeds the mark of 300 clients by the end of 2023.
One of the attractions to cross sell based on Flash is the fact that SaaS was born integrated into the startup’s benefits platform. With the same login as the employees, the company that subscribes to the system already has all the information to start “running” the solution.
To gain ground in this market, however, Flash will face stiff competition. Totvs, for example, paid R$66 million to own 60% of Feedz, a company that develops performance management and human resources software, in September of this year.
In addition to traditional companies, more and more startups are “adventuring” into the HR market, considered one of the corporate areas that still uses little technology. An example is the Spanish Factorial, which became a unicorn after receiving a contribution of US$ 120 million in October this year. A good part of the money will be used to scale the Brazilian operation.
The Brazilian Sólides is another company capitalized by a check of US$ 100 million in a round led by the private equity fund Warburg Pincus, in February this year, which operates with a human resources management solution for small and medium-sized companies.