The DACH HR software market grew to €2.93 billion in 2025 - a 10.5% increase - as consolidation accelerates and AI reshapes vendors' business models. WorkTech Advisory's annual ranking, produced together with Personalmagazin, breaks down the numbers and the trends behind them. Growth loses a step, but stays firmly in double digits The HR software market in the DACH region (Germany, Austria, Switzerland) kept growing in 2025, even if at a somewhat slower pace than in previous

The number of funding rounds announced in August 2026 was extremely low likely due to summer break and also with the continued challenge for companies founded several years back to raise follow-on rounds in times where scaling in the market has become even more challenging. However, September will continue to show more activity again as it already started with another $150M round from HiBob and I am aware of several other interesting rounds to be announced this month as well

The number of funding rounds announced in July 2026 dropped a bit compared to June and are headlined by Skello's €200M growth funding (minority shareholder) by Bridgepoint. Beyond that mega-round, VC and angel rounds announced were focused on earlier stages with focus on France and Italy. The pattern holds: frontline workforce scheduling, AI-driven skills & recruiting intelligence, and care-economy platforms all attracting capital, with AI now the default rather than the exce

June fundings picked up noticeably compared to May again, headlined by Factorial's $150M Series D. Beyond that mega-round, VCs stayed active across European HRTech and WorkTech - this time with Spain and France leading the way alongside the usual UK activity. The familiar patterns held: AI-first companies reshaping talent acquisition, payroll, learning and AI adoption itself. Several rounds again centred on the operational and frontline workforce, and a growing number are bui

Again, April saw some interesting growth investments from VCs into European HRTech and WorkTech startups and scaleups. With a still challenging market environment as all, clients, investors and vendors, are still trying to find the exact sweet-spots of opportunities coming about with the rise of AI, we still see similar patterns in continued funding. Workforce management saw several larger funding rounds following the hypothesis of vertical solutions in underdigitized frontli

Here comes the update for M&A activity in February 2026. Whilst the discussion in global HR Tech and B2B SaaS was strongly focusing on the impact of AI on the SaaS business model and B2B SaaS valuations in general, the were still several acquisitions and mergers communicated in February that were probably also negotiated prior to this discussion. Main drivers of this consolidation were again in the payroll segment (combination of payroll outsourcing services and software), in

Whilst 2026 with a limited number of fundings announcements, February was much more busy with several companies communicating their funding rounds often still closed before Christmas / end of year. Similar to the last months of 2025, investments are again primarily in the frontline payroll, benefits, learning and talent acquisition space. Here are the details: ⬇𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭𝐬: 💵 Naboo (FR) raised a $70M Series-B round led by Lightspeed Venture Partners, with pa

Here comes the first update for M&A activity in 2026. 2025 has been an extremely busy year in HR Tech/ WorkTech consolidation and with underlying reasons for the enforced consolidation, experts expect this trend to continue into 2026. Main drivers of consolidation expected for 2026 remain: Portfolio extensions of larger (suite) vendors for more up- & cross-selling as well as ensuring AI innovation - often also driven by investors. Market and customer access into untapped ma

The year 2026 started of with a limited number of fundings announced - likely also due to holiday season. Similar to the last months of 2025, investments are again primarily in the benefits, learning and talent acquisition space. Here are the details: ⬇𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭𝐬: 💵 Carol (IT) raised a €6.5M Series-A round led by Futura SGR and P101 plus an additional €2M debt financing. Carol's total equity raised thus exceeds €11 million since its founding. Specific

The last month of 2025 contained a few larger European HR Tech fundings for new start-ups or uprising scale-ups. Again different areas of employee benefits plays as well as several recruiting and learning focus investments characterize the fundings in the European and also in the US market. US has seen less super large rounds at the end of the year - whilst there is still a chance that some closing from end of December will be communicated in early 2026. Here are the deta

Following a very active October in terms of HRTech M&A this update summarizes November transactions and there were several ones again in the European HR Tech space. Again, multiple are characterized by established vendors acquiring AI-first vendors. Furthermore, also the payroll and HCM consolidation driven by the HCM and payroll groups continued. Here is the summary for November 2025: 𝐇𝐑𝐓𝐞𝐜𝐡 𝐓𝐫𝐚𝐧𝐬𝐚𝐜𝐭𝐢𝐨𝐧𝐬: 📝 Epassi (FI) backed by TA Associates and

In November, HR Tech fundings for new start-ups or uprising scale-ups in Europe were less significant and notable in size compared to some previous months, while US showed some additional larger rounds. In general, the direction of funding towards AI-first talent acquisition and learning startups continues. Here are the details: ⬇𝐈𝐧𝐯𝐞𝐬𝐭𝐦𝐞𝐧𝐭𝐬: 💵 Guidoio (IT) raised a €3.5M seed-round led by led 360 Capital alongside Azimut Libera Impresa for Italy's fir

Nach den ersten Anzeichen einer Verbesserung des Geschäftsklimas im Frühjahr 2025, bestätigt die Konjunkturbefragung unter HR Software-Anbietern im Herbst diese Entwicklung. Die Bewertung der aktuellen Geschäftslage macht einen deutlichen Sprung nach oben und auch die Geschäftserwartungen verbessern sich weiter gegenüber denen im Frühjahr. Geschäftslage und -erwartungen Der Geschäftsklimaindex für den deutsch­sprachigen HR-Tech-Markt folgt den geäußerten Hoffnungsschimmern

For my first business trip in my new role as WorkTech/ HRTech advisor I travelled to Amsterdam 🇳🇱 today. The trip alone showed me why...