More than 80% of the global workforce, about 2.700 billion employeesThey don't do it with computers, and that has led to a stark disparity when it comes to technology, with only about 1% of IT spending going to them as users. That has been changing very quickly with the rise of smartphones and apps, and today, one of the startups that has seen a business boom as a result of that trend is announcing some funding to seize the opportunity is Flip.
Flip, has a communications app for frontline workers to chat with each other, receive communications from management, and perform HR activities such as changing shifts. Having already raised $30 million since its launch in Stuttgart and used mainly in German-speaking countries, it will use the funds to break into new markets, starting with the UK, CEO and founder Benedikt Ilg said.
Notion Ventures and Berlin-based fund HV Capital are jointly leading the round, with previous 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 targeting the same sector of the global workforce and the same use case around communications: they include Meta's Workplace, Microsoft's Teams, Crew (now owned by Square), Blink, Yoobic , When I Work, Workstream, Snapshift and many more.
But there are three things that are relevant in this crowded market.
First, it is large enough and fragmented enough that there are several strong long-term players.
Second, there are still various ways each player can evolve and innovate, as the market is still fairly new (one area that has been notable for Flip, Ilg said, is that its app strictly complies with GDPR rules, which has helped you win business over others who might claim they are, but in fact are not). And even more basic: making the app easy to use, not only in terms of user interface and experience, but also in terms of the actual size of the app, the space it takes up on the phone, and the bandwidth it needs to be used.
“We are the simplest application in the industry, when it comes to downloading and using it, with the fewest number of screens. This is the spirit of what we want to build, to make things for end users,” said Ilg.
And third, critical mass is important for success. Flip it has amassed 200 clients, spanning more than 1 million users, and the list includes McDonald's, Rossmann, Edeka, Magna and Mahle. In the pandemic, a time when frontline workers were suddenly appearing in force and at the center of people's consciousness, their income has skyrocketed and increased sixfold in the past year, Ilg said.
Today, businesses primarily use the app to communicate with their broader base of employees, people who move throughout the day and typically won't work in one place. Those people also use the app to communicate with each other, primarily for productivity purposes: to change shifts or check payroll, but not to perform functions directly related to their work. This is an area where rivals like Yoobic have been creating features, and Ilg said that Flip he is also beginning to see how he might do it.
“Flip offers an opportunity for every employee without a PC to participate in the communication process of their own company. There is great potential in the active integration of these employees. We hope to support Flip with our expertise and experience as it expands into the English-speaking market,” said Jos White of Notion Ventures.
