15Five raises $30.7M to expand its employee development toolkit

Technology has been used to improve many of the processes that
we use to get work done. But today, a startup has raised funding to
build tech to improve us, the workers.

15Five, which builds
software and services to help organisations and their employees
evaluate their performance, as well as set and meet goals, has
closed a Series B round of $30.7 million, money that it plans to
use to continue building out the functionality of its core product
— self-evaluations that take “15 minutes to write, 5 minutes to
read” — as well as expand into new services that will sit
alongside that.

David Hassell, 15Five’s CEO and co-founder, would not
elaborate on what those new services might be, but he recently
started a podcast
with the startups “chief culture officer” Shane Metcalf around
the subject of “best-self” management that taps into research
on organizational development and positive psychology.

At the same time that 15Five works on productizing these
principles into software form, it seems that the secondary idea
will be to bring in more services and coaching into the mix
alongside 15Five’s existing SaaS model.

This Series B is being led by Next47​, the strategic
investment arm of manufacturing giant Siemens. Others in the round
included Matrix Partners, PointNine Capital, ​Jason Calacanis’s
LAUNCH Fund​, Newground Ventures, Bling Capital, Chaifetz
​Group, and ​Origin Ventures (which had led 15Five’s Series
A). It brings the total raised to $42.6 million, but Hassell said
that while the valuation is up, the exact number is not being
disclosed.

(Previous
investors
in the company have included David Sacks, 500
Startups and Ben Ling.)

15Five’s growth comes at a time when we are seeing a
significant evolution in how companies are run internally. The
digital age has made workforces more decentralised — with people
using smartphones, video communications and services like Slack to
stay in constant contact while otherwise working potentially
hundreds of miles from their closest colleagues, or at least not
sitting in one office altogether, all the time.

All well and good, but this has also had an inevitable impact on
how employees are evaluated by their managers, and also how they
are able to gauge how well they are doing versus those with whom
they work. So while communication of one kind — getting
information across from one person to another across big distances
— has seen a big boost through technology, you could argue that
another kind of communication — of the human kind — has been
lost.

15Five’s approach is to create a focus on building an easy way
for employees to think about and set goals for themselves on a
regular basis.

Indeed, “regular” is the operative word here, with key thing
being frequency. A lot of companies — especially large ones —
already use performance management software (other players in this
space include BetterWorks, Lattice, and PeopleGoal among many
others), but in many cases, it’s based around self-evaluations
that you might make annually, or at six-month intervals.

15Five’s focus is on providing a service that people will use
much more often than that.  all the time, by way of sending praise
to each other when something positive happens (it calls these
“High fives” appropriately enough), as well as regular
evaluations and goals set by the employees themselves.

Hassell said in an interview that this is in tune with what
modern workplaces, and younger employees, expect today, partly
fuelled by the rise of social media.

“Most millennials will get feedback on what they eat for
breakfast more than what they do at work,” he said. “The rest
of our lives exist in a real-time feedback loop, filled with
continuous in positive reinforcement, but then you go into work and
have an annual or maybe biannual performance review? It’s simply
not enough.” He said that he knows some millennial employees who
have said that they will not work at a company if it’s not
already using or planning to adopt 15Five, and since talent is the
cornerstone to a company’s success this could have a significant
impact.

The startup was born in San Francisco in more than one sense:
it’s based there, but its principles seem to be uniquely a
product of the kind of self-reflection and self-care/quality of
life emphasis that has been associated with California culture for
a while now, even admist the relentless march that comes with being
at the epicenter of the tech world.

In that regard, its newest investor, Next47, will help put
15Five to the test, both in terms of how the product will be
adopted and used at a company whose holdings are as much
manufacturing as technology, and in terms of sheer size: Siemens
globally has around 400,000 employees.

Matthew Cowan, a partner at the firm, noted that while Siemens
is currently not a 15Five user, the thinking behind the investment
was strategic and the idea will be to incorporate it into the
company’s practices for helping employees’ progress.

“It’s very representative of how the workplace is
transforming,” he said

Source: FS – All Tech News 2
15Five raises .7M to expand its employee development toolkit