A Denver-based provider of global expansion solutions has raised $100 million and acquired a competitor in the space as it prepares to cross $1 billion in revenue next year.
Velocity Global announced its acquisition of iWorkGlobal, a wholly owned subsidiary of Gary D. Nelson and Associates, and a $100 million growth investment from private equity firm FFL Partners to fuel the deal.
Founded in 2014, Velocity helps other companies hire workers around the world. If an American company wants to hire employees in the U.K., it can hire through Velocity Global rather than take on the cost of setting up a corporate structure in another country.
While Velocity had been bootstrapped since its beginning, not raising any outside capital, founder and CEO Ben Wright said they always left the possibility open to bring on a partner.
“We enjoyed our run as a self-funded company, but we always looked at it and said, ‘If there’s any real great opportunities and we don’t have the balance sheet on our own to tackle it, we’d talk to some partners,” he told Denver Business Journal.
That’s exactly what happened in the time leading up to Velocity’s acquisition of iWorkGlobal. Much like its acquirer, iWorkGlobal offers employer of record services, focused primarily in all 50 states across the U.S., compared to Velocity’s global reach.
Wright said iWorkGlobal’s U.S. footprint brings a unique angle to the company, with Velocity now able to offer comprehensive services to enterprise companies.
“Companies are looking for a single partner, whether you’re in Uzbekistan or Georgia,” he said.
As a result of this transaction, Velocity Global expands its offering to include employer of record services in all 50 states and more than 185 countries across the world. Velocity Global now counts more than 700 brands as customers and supports their 4,000 employees.
On its own team, Velocity Global now has approximately 300 employees worldwide, with regional headquarters in Amsterdam, Bogotá and Singapore. Wright said he expects the company to reach 400 employees by year-end and approximately 600 to 700 by this time next year.
In addition to backing the acquisition, the investment from FFL Partners will also be used for additional strategic acquisitions, technology developments and further expansion of the company’s global footprint.
Wright said the pandemic presented an incredible opportunity to Velocity Global, as companies began to see how crucial remote work became to their mission and their employees’ needs. Despite challenges early in the pandemic, Velocity still grew rapidly in 2020.
“We’ve seen significant and unprecedented growth starting in the third quarter on of last year and it’s all predicated on the fact that companies are faced with a new reality around employment and employees are faced with a new reality around employment,” Wright said. “The employee is no longer tethered to the workplace.”
Even as we emerge from the pandemic, Wright said Velocity is well positioned to help companies tackle the reality of remote work.
In fact, he said Velocity Global is on track to pass $1 billion in revenue in 2022 and isn’t stopping there.
In setting expectations for Velocity’s growth, Wright cited a 2020 report from Staffing Industry Analysts that predicted that the global staffing and gig economy was worth $4.5 trillion. With this funding and iWorkGlobal in the fold, Wright has sights set on a big target.
“Our plan and our vision is to really go tackle that future of work total addressable market, which is absolutely massive.”
