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World NewsHow Personio CEO Hanno Renner built a $6.3 billion company

How Personio CEO Hanno Renner built a $6.3 billion company

Personio CEO Hanno Renner

Benjamin Hall | CNBC

In simply six years software program agency Personio has grow to be one in every of Europe’s Most worthy start-ups, valued at $6.3 billion.

But CEO Hanno Renner remembers a time when cash was tight for the company.

Speaking to CNBC, Renner recalled how the enterprise had simply 200 euros ($226) left within the company checking account earlier than it obtained its first actual funding.  

Renner co-founded Personio in Munich, Germany, in 2015 with Roman Schumacher, Arseniy Vershinin and Ignaz Forstmeier. The 4 met whereas learning on the Center for Digital Technology and Management, a joint establishment from the 2 essential faculties in Munich.

The thought for Personio, which is concentrated on serving small and medium-sized companies, got here from listening to how a buddy was struggling to handle HR processes on the company the place he was working as a chief expertise officer, as a result of he did not have the mandatory software program.

So the 4 set about creating a answer. As college students, they did not have an workplace, so labored wherever they may discover house in school to construct Personio’s first software program product. They scrambled collectively any financial savings that they had to assist with the prices.

Once they acquired prospects paying to make use of that first piece of software program, they used the income to purchase their first software program licenses, hire out a small workplace house and rent a small variety of workers.

Then, in July 2016, Personio raised 2.1 million euros in a seed funding spherical, with buyers together with Global Founders Capital, which has backed the likes of LinkedIn and Facebook, which lately rebranded as Meta.

Renner stated that earlier than Personio might obtain that first spherical of funding, the founders had to make sure that they had paid any excellent invoices, which he defined was a customary situation of fund-raising offers.

He stated: “I still have a screenshot from that bank account: We had like a couple of 100 euros left in the bank account before we then received our first round of funding, which was 2 million [euros] at the time, but it was really interesting how tight we were managing until then.”

Personio’s monetary state of affairs has modified dramatically since then. In it is newest sequence E spherical of funding, introduced in October, Personio raised $270 million and was valued at $6.3 billion. That’s fairly a bounce for the company, having been valued at $1.7 billion in January in its sequence D spherical of funding.

In whole, Personio has now raised greater than $500 million from buyers.

And in contrast to when it was a fledgling start-up in 2016, Personio stated it nonetheless had “significant reserves” from its funding spherical in January, when the most recent funding was introduced final month.

The newest batch of funding is getting used to develop its latest class of software program, known as People Workflow Automation. This goals to take away software program limitations between HR and different company departments, for example, if numerous duties have to be accomplished throughout completely different components of a enterprise when hiring an worker. 

Personio’s rivals embody fellow HR software program start-ups like Hibob, in addition to bigger incumbents like SAP and Salesforce.

‘Not about being a boss’

Heading up a multi-billion-dollar software program enterprise appears worlds other than Renner’s part-time job as a yacht skipper whereas he was in faculty.

Renner stated that he’d all the time had a ardour for crusing. As a faculty scholar he could not afford to pursue it as a interest along with his personal cash, so determined to get his yachtmaster’s license. This enabled him to grow to be a skipper and receives a commission throughout faculty holidays to drive boats around the globe, which additionally helped him finance his research.

But it wasn’t all enjoyable and glamor. Being accountable for a boat may be “intense and [a] harder job than most people think,” Renner stated, on condition that he was chargeable for the crew and company.

That degree of accountability in main a crew did assist put together him for the function of CEO, when it comes to recognizing the significance of taking over board enter from his workers.

However, for Renner constructing a company is “not about being a boss or being someone’s boss,” he stated, explaining that he needed to encourage a “level of ownership” amongst Personio’s workers.

Renner stated that he needed to ensure workers are “empowered to make the right decisions and empowered to act like an entrepreneur.”

And clearly one thing is working, Personio now has greater than 1,000 members of workers, up from 350 workers in 2020.

CNBC’s Ryan Browne contributed to this story.

Check out: How two faculty mates acquired Serena Williams and Usain Bolt to again their enterprise

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