Online background check startup Checkr rakes in $160 million to help companies hire more people, faster, in an incredibly competitive labor market
- Checkr, an online tool to conduct background checks on job candidates, announced Thursday it raised $160 million in Series D funding.
- The round was led by T. Rowe Price Associates with participation from new investors Bond Capital and Coatue Management. The round valued 5-year-old Checkr at $2.2 billion.
- Checkr cofounder and CEO Daniel Yanisse told Business Insider that the funds will be partially used to help facilitate international expansion of Checkr's various safety and compliance tools at the behest of the startup's larger global customers.
- Yanisse also said that market conditions, with historically low unemployment but rising uncertainty, could prompt Checkr to create and monetize new tools to help customers cope with different economic scenarios.
Hiring the right employees can be a crucial make-or-break moment for any company. And now, thanks to Checkr, it's a multi-billion-dollar business.
The background check software startup announced Thursday it raised $160 million in Series D funding, valuing the 5-year-old San Francisco startup at $2.2 billion. The round was led by T. Rose Price Associates with participation from new investors Bond Capital and Coatue management in addition to existing investors Accel, Y Combinator, and IVP.
Checkr's success so far comes at the intersection of two major global forces: cheap capital and historically low unemployment. While pundits and armchair economists wonder if a recession is imminent, Checkr says that it has a simple mission that can endure most any economic conditions - help companies hire more people, faster, by speeding up the process of background checks.
"The more fluxes and changes there are in the workforce, the more business we will do," Checkr cofounder and CEO Daniel Yanisse told Business Insider. "There will be ups and downs in the economy, but our solution is needed at all times because it is infrastructure everyone needs. We will navigate if things fluctuate, and maybe we will create new tools based on those needs."
To that point, Checkr helps companies like Uber, Hot Topic, and even staffing agencies like PrideStaff quickly bring workers on board by doing the required diligence on their backgrounds. It even has a product, specifically for gig economy companies, that continously performs background checks on workers to make sure there are no new surprises.
Checkr is trying to find its own ways into recruiting quickly: As it grows, it needs as much talent as any other well-funded startup with big ambitions. To hire quickly, the startup has widened its recruiting drive to include candidates with a criminal record - something it has been advising its customers to consider with unemployment rates at all-time lows.
"Background checks were the heart of the problem because they were used in such a binary way," Yanisse said. "Opening requirements and giving people a chance even if they have a criminal record helps support the business. It's a win-win for businesses and people."
Looking beyond the early days
Yanisse also announced Thursday that former Zuora president Marc Diouane would join the company as chief business officer, and WeWork's former chief security officer Cory Louie would come on as chief trust and safety officer.
"We've done a few fundraising events the last few years, but now we are lucky that we are in a strong position," Yanisse said. "It's like gunpowder to accelerate the business even faster."
In addition to increasing headcount, which already clocks in around 400 employees across multiple offices, Yanisse said the funds will help his team explore the possibilities of international expansion for Checkr's suite of tools and services which have only been available in North America. International capability will be available in 2020, Yanisse said.
"We are past the early days and we have large customers," Yanisse said. "A lot of startups only have startup customers but then it's hard to bring on Fortune 500 customers, but we've done that. A lot of large customers have a presence around the globe."