The proliferation of flexible working options gives hourly workers increased autonomy over their professional lives by providing choice in respect to wages, scheduling flexibility, location, and the type of work. With acute labor shortages across a number of industries, employers are tapping into the flex worker pool to address acute scheduling needs. However, this does not come without challenges. Nowsta is an all-in-one flexible workforce management platform that allows companies to source, manage, and analyze hourly labor talent. The platform features a robust on-demand talent marketplace of available talent across an array of industries including events/catering, hospitality, warehouses, stadiums, and academic institutions. Nowsta counts organizations like Marriott, The Milkwaukee Brewers, Chase Center, and Fontainebleau as users. The platform handles everything from time tracking., payments, integration with staffing agency partners for placements, reporting, payments, and invoicing.
AlleyWatch caught up with Nowsta CEO Nick Lillios to learn more about the business, the company’s strategic plans, latest round of funding, which brings the company’s total funding raised to $87.1M, and much, much more…
Who were your investors and how much did you raise?
This $35M Series C round of financing was led by VMG Partners and joined by Builders VC along with existing Series B funders, which brings Nowsta’s total fundraising to $93M. Nowsta plans to use this investment to enhance the advanced technology in Staffing Labs, further develop its AI-driven workforce management platform, and continue to build out the executive leadership team that oversees and supports this technology.
Tell us about the product or service that Nowsta offers.
Nowsta helps companies source, manage, and analyze multiple sources of hourly labor in one platform – enabling flexibility for both employers and employees.
What inspired the start of Nowsta?
While consulting for a large food service vendor, I remember walking into the staffing office and seeing papers everywhere, Excel sheets up on the screen, and people frantically calling and texting people. I remember thinking that there has to be a better way to manage workers. I quickly realized that large workforces like this are really inefficient and don’t have good technologies to manage this new type of workforce like on-demand, flex, or temp workers. The rest is history.
How is Nowsta different?
Nowsta easily fits into companies existing staffing models. No matter the staff – from W2s and 1099s to temporary, flex, and gig workers – Nowsta provides the tools needed to manage all types of workers under one platform.
What market does Nowsta target and how big is it?
Nowsta provides services to those industries utilizing workers in the gig economy and the contingent workforce. This can be anywhere from warehousing and property management to hotels and catering companies. If a business utlizes flex workers, they can utilize Nowsta. Our primary focus is on empowering these businesses to manage their workforce efficiently while also enabling workers to access flexible job opportunities. This market is substantial. In the United States alone, the contingent workforce can account for around 40% of the total workforce with a gross volume of nearly half a trillion dollars. As the gig economy continues to grow, the market for flexible staffing solutions is expected to expand even further.
How are you preparing for a potential economic slowdown?
Whether a slowdown is imminent or not, preparation for economic fluctuations is essential. At Nowsta, we’re ensuring that our platform remains adaptable and cost-effective. We emphasize providing value to our clients by streamlining their labor management processes, ultimately helping them optimize their costs. This value proposition becomes even more critical during economic slowdowns when businesses need to maximize operational efficiency. By offering cost-efficient and flexible solutions, we enable our clients to manage their labor resources effectively, even in challenging economic conditions.
What was the funding process like?
This funding series – like all funding series – was an exciting journey. We are fortunate to engage with investors who share our vision for the future of work. We put a lot of effort into crafting a compelling narrative, demonstrating the potential of our platform, and highlighting the value we bring to both businesses and workers. We approached the funding process strategically, seeking investors who not only provide capital but also bring industry expertise and valuable networks. This approach has helped us secure investments that align with our long-term vision and work with some incredibly smart and talented investor groups.
What are the biggest challenges that you faced while raising capital?
The gig economy has its unique characteristics and dynamics, and translating these complexities to potential investors can sometimes be a challenge. And while raising capital is never an easy feat, we were lucky to work with forward-thinking investors who understood the nuances of the contingent workforce market. Additionally, the competitive landscape in the HR tech space means that distinguishing Nowsta and our innovative solutions required a focused and compelling pitch. I credit our product and marketing teams with crafting a compelling narrative and solution investors can easily see the value in. At Nowsta, it truly is a team effort when it comes to raising capital.
What factors about your business led your investors to write the check?
Our investors, both new and recurring, believe that Nowsta is an industry leader when it comes to understanding what employers need to navigate an ever-changing workforce. The clear vision that Nowsta has for the future and our ability to deliver innovative solutions that improve today’s labor market help fuel this truth to our investors.
What are the milestones you plan to achieve in the next six months?
In the coming six months, our primary focus is on continued growth and enhancing our product. We aim to expand our customer base by further empowering businesses to manage their workforce efficiently. We’ll continue to invest in our technology, leveraging AI and data-driven insights to make our platform even more intelligent and user-friendly. Additionally, we plan to explore partnerships and integrations to provide a more holistic HR tech solution. This is just the tip of the iceberg when it comes to Nowsta’s capabilities and I can’t wait to see what the future holds 6, 12, and 18 months from now.
In the coming six months, our primary focus is on continued growth and enhancing our product. We aim to expand our customer base by further empowering businesses to manage their workforce efficiently. We’ll continue to invest in our technology, leveraging AI and data-driven insights to make our platform even more intelligent and user-friendly. Additionally, we plan to explore partnerships and integrations to provide a more holistic HR tech solution. This is just the tip of the iceberg when it comes to Nowsta’s capabilities and I can’t wait to see what the future holds 6, 12, and 18 months from now.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
This might sound generic, though, I hope not. But for companies in New York (or anywhere, for that matter) wise financial management is crucial, especially when fresh capital isn’t readily available.
Here are some key pieces of advice:
- Focus on Efficiency: Prioritize operational efficiency to maximize your existing resources.
- Embrace Technology: Leverage cost-effective technologies and tools to streamline processes.
- Optimize Costs: Continuously assess your expenses and seek opportunities for cost optimization.
- Build Strong Relationships: Forge valuable partnerships and collaborations to expand your reach.
- Seek Growth Slowly: Pursue measured, sustainable growth strategies without overextending resources.
While fresh capital can provide a significant boost, diligent financial management and strategic decision-making can help companies thrive even in challenging financial situations.
Where do you see the company going now over the near term?
Nowsta has never been more committed to revolutionizing the way in which employers source, manage, and build pools of contingent workers and empower workforces with economic opportunities on their terms. We are launching new products and services to help brands like Marriott, Milwaukee Brewers, Chase Center to leverage advanced technology to simplify, and humanize, the labor experience.
What’s your favorite fall destination in and around the city?
It’s easy to say Central Park and leave it at that, isn’t it? If you’re pressing me, check out The High Line, the Brooklyn Botanic Garden, or the Bronx Zoo. And if I’m being really honest, just walk the streets. New York is a city best explored on foot, and the crisp fall air makes it even more enjoyable. Winter hasn’t come, the snow isn’t treacherous, and the wind isn’t biting, so take the time to explore different neighborhoods, enjoy the changing leaves, and take in the city’s atmosphere without having to pay a price for admission. Some things shouldn’t require capital, right?
