Seek offloads a $95 million slice of its Employment Hero investment to US private equity firm KKR

ASX-listed Seek’s venture fund is selling a $95 million portion of its holding in unicorn HR startup Employment Hero to US investment firm KKR.

The deal was announced as part of Seek’s (ASX: SEK) half-yearly results today, which saw ANZ revenue declined by 4% to A$416m, reflecting a 14% drop in job ad volumes. Total revenue fell 4% and EBITDA was down 9% to $223.9m. Adjusted profit fell 28% to $77m and reported profit was $139.8m.

Seek’s share of the proceeds from $95m secondary share sale is $79m (the company  owns 84% of the Seek Growth Fund). The fund continues to be “a material investor” in Employment Hero, which had an implied valuation of $2.2 billion in the deal, up 19% from June 2024. That valuation was used in the Fund’s portfolio at December 31. The fund valuation was 5% higher in H1 FY25, for total growth of 30% since the Fund was created to $2.2bn.

Seek Investments CEO Andrew Bassat said: “We retain our high conviction towards Employment Hero’s strategy and outlook”.

Employment Hero is one of the big 4 investments in the fund, which represent 79% of its value, alongside GO1.

Employment Hero, founded in 2014, spent $112 million last month acquiring Canadian rival Humi as part of ambitions to expand into the North American market.

In 2023 Employment Hero hit a $2 billion valuation following a $263 million Series F. Shortly after that, fellow investor OneVentures turned an early-stage $8.8 million bet into a $116m return in a secondary sale on its stake.

Just before Christmas, corporate filings revealed Employment Hero paid $43.4 million to acquire cofounder and CEO Ben Thompson’s s side hustle, the loss-making professional services firm Employment Innovations, last April.

Thompson said more than 300,000 businesses globally are using their employment operating system.

“Our recent milestone of A$250 million in annual recurring revenue also signals the growing customer demand for our jobs, payroll, HR and benefits products to drive better business outcomes,” he said.

“KKR’s significant experience, resources and network will be extremely valuable in our efforts, particularly as we look to further develop our international footprint.”

KKR previously invested in Advanced Navigation, the Sydney AI robotics and navigation technology startup.

Head of Asia Pacific growth equity Mukul Chawla said the Employment Hero aligns with the thematic focus on SMB (small and medium business) software.

“We look forward to supporting the continued platformisation and international expansion of Employment Hero, which has established itself as a leader in human resources management in multiple markets including Australia, the UK, and Canada with its cloud-native and comprehensive product suite,” he said.