We have some very exciting news to share—we raised $27 million! It’s such an incredible accomplishment for all our team members who worked hard to get us here, and we’re grateful to our new and existing investors who believe in our vision to make workers’ comp and payroll better for everyone.
Glilot Capital Partners led our Series A, and what’s great about this round is that it includes all the investors who helped us get started in the first place–and more. These are S Capital, MS&AD Ventures, J-Ventures, new backers Vintage Investment Partners and Upshot, and a large number of angel investors.
So what are we going to do with this $27 million? We’re planning to expand our insurtech platform outside the state of California and make it available to one-third of the U.S. population by the end of 2023. This is part of our larger vision to completely change the workers’ comp game–for good. Read on to learn exactly what that means, and how we got started.
How Hourly is Revolutionizing Workers’ Comp
If you’re a small business owner, you’re probably familiar with workers’ comp–shopping for the insurance in the first place, paying your premium and filing claims if an employee ever gets injured. But how much of this is actually easy for you? As someone who ran a construction company, I can tell you—especially if you have employees in high-risk jobs—workers’ comp is no walk in the park.
Premiums are based on annual payroll estimates. For a business with hourly employees, changes in staff, hours, and pay make it nearly impossible to accurately estimate payroll. So, what happens? Many businesses over or underpay their premiums, often by tens of thousands of dollars.
Hourly is the first platform that lets employers run payroll, track time and attendance, and manage workers’ comp insurance premiums in one place. Why is this a good idea? Basically by directly linking payroll and workers’ comp, premiums are based on your actual payroll–not a guess. Since we have a pay-as-you-go model, business owners only pay for the coverage they use every pay period.
What’s more—as we look to the future—we plan to build in features that allow business owners to get more affordable coverage, file claims easily, run safety programs, and more—all from our platform.
So how exactly did Hourly come to be? And what do customers think about moving their payroll and workers’ comp to a brand new platform? We’ll go into all that and more, so keep reading.
The Story Behind Hourly
I know I touched on this a little—that I have a background in construction—but how, exactly, did I find myself running a tech company? Can someone who builds buildings transition to building an app? Well, I’m definitely no software engineer. But, I found a problem and built an amazing team that wanted to solve it. And these are the main building blocks (no pun intended). So here’s the story:
Before It All Started
Before I founded Hourly, I managed a construction company and experienced firsthand the frustration of processing payroll manually and trying to calculate accurate workers’ comp premiums. I was constantly stressed about fixing timesheet errors, getting paychecks out on time, paying payroll taxes, and more.
On top of that, I never knew if I’d owe money on my workers’ comp insurance at the end of the year—and if so, how that’d affect our cash flow and ability to pay everybody on time.
It was in the midst of all that stress I had the vision to create a platform that helps small businesses with hourly workers handle payroll and workers’ comp in a matter of minutes.
Finding the Team
I knew I needed great partners with technical and leadership expertise to help turn this idea into a reality. That’s when I teamed up with my co-founders Shay Litvak, a technologist with over 20 years of experience, and Amir Faintuch, a tech entrepreneur, investor and senior executive. Together, we created the Hourly platform with the goal of revolutionizing the $50 billion workers’ comp insurance industry and creating a better experience for small business owners.
Of course, that didn’t happen overnight. We bootstrapped for a while, used all of our savings and maxed out every credit card in a 10-mile radius. We built a small but mighty team of amazing software engineers and designers to help us actually build the platform.
Getting our First Investors
In September 2019, with a strong team, a great MVP and plenty of early adopters we raised a $7.15 million seed round. And, in the two and a half years since closing the seed round, our team grew from 14 to 90 people, we onboarded nearly a thousand new customers in California and we continue to develop and improve our product.
In 2021 we decided to start making workers’ comp insurance available too–facilitating the sale of policies between carriers, agents and customers. Today, we have hundreds of insurance agents selling our integrated payroll and workers’ comp platform which has led to 20 percent month-over-month revenue growth.
And Here We Are Today
So here we are—a growing company that’s solving the exact problem I had for years in my construction business. We’re thrilled to expand Hourly out of California and give business owners across America a better way to pay their team, get a handle on their true labor costs, and better manage their workers’ comp insurance.
What Do Our Customers Think?
We wouldn’t be where we are today without our awesome customers. Not only because we need people to actually use our app (of course!), but also because they’ve given us great insights throughout the years on exactly what they need from a payroll and workers’ comp app.
We’ve kept the conversation going, and during our discussions heard some great things about Hourly. Their kind words really motivate us to keep working hard and growing, and we can’t wait to do even more for them. So here’s what our customers are saying about Hourly:
“Hourly saved us $45K on workers’ comp in 2019 alone. The technology is fantastic–it connects the dots between hours, payroll and workers’ comp. I love it.” – Florentino Gonzalez, All Star Framing.
“This year we are saving $12K on workers’ comp, and with pay-as-you-go, I don’t have to worry about an audit bill.” – Richard Gill, A Touch of Stone.
Continuing to Make Workers’ Comp Super Simple
To wrap it up, I started off building buildings and ended up building an app with an amazing team of software engineers, designers, insurance professionals, sales whizzes, marketers and more.
While the idea for the platform originated from my experience in the construction industry, we’re here for all businesses that pay hourly workers who venture out into the field.
Our $27 million Series A means we can grow even bigger and finally make workers’ comp and payroll super simple.
So now that you know all about how we started, and where we are today—all that’s left to do? If you’re a customer or agency, please continue to share your feedback with us—it’s really invaluable and helps us get better, which in turn helps you! If you’re new to Hourly or interested in learning more, consider scheduling a free 15-min demo and see what all the fuss is about.
Cheers,
Tom Sagi
Co-founder & CEO of Hourly.io
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