During Sanish Mondkar's long journey across the United States many years ago, he realized that there was a deep and problematic disconnect between employers and their employees. Ta.
To critics of late capitalism, this may seem like an obvious point. But Mondker, who earned a master's degree in computer science from Cornell University, says seeing the problem up close made all the difference.
“As I moved from town to town, I couldn't help but notice the constant 'for hire' signs posted in the windows of countless labor-intensive businesses, including retail stores and restaurants,” he says. . “At the same time, I saw employees struggle to earn a living wage while changing jobs frequently. This disconnect between the needs of employers and the reality of workers shocked me. I gave it.”
Inspired by this experience, and his time working at Ariba as EVP and Chief Product Officer at SAP, Mondkar set out to build a startup that helps companies manage their employees, especially contract and gig workers. His venture, Legion, today announced that he has raised $50 million in funding, led by Riverwood Capital, with participation from Norwest, Stripes, Webb Investment Network, and XYZ.
“My objective was to reimagine workforce management for the enterprise category in order to maximize labor efficiency for enterprises and at the same time deliver value to workers,” Mondkar said. “We wanted to differentiate ourselves as a company by focusing on WFM's intelligent automation and employee value proposition.”
Legion helps its customers, who are employers such as Cinemark, Dollar General, Five Below, and Panda Express, automate certain decisions such as how much workforce to deploy, where to schedule employees, and when to schedule them. , designed to support the management of hourly staff. Legion's platform takes into account demand forecasts, workforce optimization, and employee preferences to generate work schedules.
Employees at companies participating in Legion can request their preferred work style and set their preferred hours using a mobile app. Legion's algorithms attempt to match employee preferences with business needs.
Legion also includes performance management tools and a rewards program of sorts.
“We use algorithms trained on a combination of customer data and third-party data that Legion collects from our partners,” Mondker said. “This integration enables predictive planning and resource allocation.”
In addition to basic scheduling functionality, Legion is very on-trend and leans toward generative AI using a tool called Copilot (not to be confused with Microsoft Copilot). Copilots answer work-related questions based on the organization's employee handbook, labor standards, and training. In the coming months, Copilot will be able to summarize work schedules and respond to requests to add or remove shifts and reassign staff.
“To attract and retain staff, companies that employ hourly labor need to mimic gig-like flexibility,” Mondker said. “Legion provides intelligent automation of scheduling. Managers can align staff to anticipated demand and bridge the gap between employee needs and business needs.”
That's all well and good, but there are two things that bother me about Legion. Privacy Policy and Earned Wage Access (EWA) Program.
Legion says it stores customer data for seven years by default, which is a long time no matter how you look at it. Even more concerning, the data includes personally identifiable information such as employees' first and last names, email and home addresses, age, photos, and work preferences. It's tough.
Legion says this data is needed to “facilitate scheduling in compliance with labor regulations” and that users can request data deletion at any time. But I have questions about the ease of the deletion process and how transparent Legion is with its customers about its data retention policies.
My other complaint with Legion is InstantPay, Legion's EWA program that allows employees to access a portion of their wages earned before their scheduled payday. At Legion, he charges workers $2.99 for immediate earned wage transfers, but next-day transfers are free. While this may not sound like a lot of money, it can be expensive for low-income workers. Legion touts this as a benefit for hourly workers, giving them “more flexibility” and “control” over their financial management, as well as being a business retention tool. However, EWA programs are under scrutiny from policymakers, consumer rights advocates, and employers. Legion mobile app.
Some consumer groups argue that the EWA program should be classified as a loan under the Truth in Lending Act. The law provides protections such as requiring lenders to give advance notice before increasing certain fees. These groups argue that EWA programs can force users to overdraft while effectively collecting interest through fees.
Furthermore, it is not clear whether EWA programs will ultimately benefit employers. Walmart recently sought to address layoffs by allowing hourly staff to receive pay early. Instead, we found that employees using EWA tended to quit sooner.
My ramblings about Legion aside, the company seems to be growing steadily despite competition from companies like Ceridian's Dayforce, Quinyx, and UKG, with revenue and bookings up 55% and 125%, respectively, last year. did. This is especially true given that funding for HR technology startups fell to a three-year low last year, from $10.5 billion in 2021 to $3.3 billion, following a flurry of interest from venture capital. Impressive.
Legion makes money by charging subscriptions calculated based on the number of hourly workers companies hire, and is banking on its recently raised funding to expand its research and development and customer-facing teams. The company plans to use the funds to expand its workforce by 200 people, with a focus on launching new services. -Market initiatives in Europe.
To date, Legion's has raised $145 million.
“Legion will use the funds to foster continued innovation in workforce management, including significant investments in research and development,” Mondcar said. “The region has been relatively immune to broader technology slowdowns due to its focus on labor-intensive industries. This strategic alignment positions us to effectively weather potential economic headwinds. is in place.”