Flip, a chat and HR app for frontline workers, raises $30 million as it passes 1 million users – TechCrunch

Startups

More than 80% of the world’s workforce, some 2.7 billion people, do not spend their days in front of computers, which has led to a strong technology inequality, with about 1% of IT investment is aimed at them as users. That is changing very quickly with the rise of smartphones and apps, and today one of the startups that has seen its business grow as a result of that trend is announcing some funding to take the opportunity.

Flip, which is creating a communications app that allows front-line workers to chat with each other, get communications from management, and perform HR activities such as switching shifts, has raised $30 million. The startup — based in Stuttgart, Germany, and operated primarily in the German-speaking DACH region — will use the funding to enter new markets, starting with the UK, said CEO and founder Benedikt Ilg.

Notion Ventures and Berlin-based fund HV Capital are leading the round along with past backers Cavalry Ventures and LEA Partners, along with individual backers including Volkswagen chairman Matthias Müller and many others.

There are a number of other apps on the market that target the same sector of the global workforce, and the same use case around communications: They include Workplace by Meta, Teams by Microsoft, Crew (now owned by Square), Blink, Yoobic, When I Work, Workstream and much more. Today, Snapshift, another frontline work app that focused primarily on the HR side of the opportunity, also announced funding.

But there are three things to say about what looks like a crowded field. First, it is a large and so fragmented market that there will likely be several strong players in the mix in the long run. Second, there are still a number of ways for each player to evolve and innovate as the market is still quite new. (One area that stands out for Flip, Ilg said, is that his app is strictly GDPR compliant, which has helped it win business from others who may claim they are, but in fact aren’t.) Another area is even simpler: making the app easy to use, not only in terms of user interface and experience, but also in the actual size of the app, the space it takes up on your phone, and the bandwidth it needs to use.

“I worked in production at Porche before starting Flip, and I know what it feels like, the lack of communication with management,” Ilg said. “We are the simplest application in the field, when it comes to downloading and using it, with the least number of screens. This is the spirit of what we want to build, do things for end users.”

And third, if critical mass is important to success, Flip actually jumps out.

Flip has amassed 200 customers to date, spanning approximately 1 million users, including McDonald’s, Rossmann, Edeka, Magna, and Mahle. During the pandemic — a moment when frontline workers suddenly appeared at the forefront of people’s consciousness — revenues have skyrocketed and have grown sixfold in the past year, Ilg told me. (The startup does not disclose actual earnings or valuation.)

For those following the space, you may have noticed a story we wrote last week about how Workplace had hoped to announce McDonalds as a customer, but delayed it. Flip’s involvement with the company currently numbers some 60,000 people. Since the fast food giant is already working with Flip publicly, it will be interesting to see how the Workplace deal plays out. In any case, it underlines how much there is still to play here.

The app is mainly used by employers today to communicate with their wider base of employees, people who move around during the day and typically don’t work in one location. Those people also use the app to communicate with each other, especially for productivity purposes: to swap shifts or check a paycheck, but not to perform functions directly related to their work. This is one area where rivals like Yoobic have built features, and Ilg said Flip is also starting to look at how this could be done as well.

“Flip offers every deskless employee the opportunity to really participate in the communication process of their own company. There is enormous potential in actively integrating these employees. We look forward to supporting Flip with our expertise and experience as it expands into the Anglophone market,” Notion Ventures’ Jos White said in a statement.

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