HCM giant Paylocity buys headcount startup Trace
Paylocity’s CTO shares exclusive insight with UNLEASH.
News In Brief
The HR tech market is booming right now.
The latest deal comes from Paylocity - it has bought Trace, a headcount planning startup.
We get the inside track from Paylocity's CTO.
HR tech has had a stellar 2023.
As the MD of global tech investment bank Drake Star Ralf Hofmann told UNLEASH in an exclusive interview, this is because organizations are realizing that “their most valuable asset is people”.
As a result, the HR market “is still very active” – the total for 2023 so far to 623 deals and with more than $15 billion invested, according to Drake Star’s reports.
The latest HR tech news comes from Paylocity, a US-based human capital management (HCM) giant – it has bought Trace, an innovative solution for strategic headcount plans.
Financial terms of the deal were not disclosed. But Paylocity did share that Trace’s seven employees will be integrated into the business.
Trace is Paylocity’s fifth acquisition since the company was founded in 1997 – previous deals include Cloudsnap in 2022, Blue Marble Payroll in 2021 and VidGrib in 2020.
A bright future for Paylocity?
UNLEASH was keen to find out why now was the right time for Paylocity to acquire Trace, and focus in on headcount planning.
Speaking exclusively with UNLEASH, Paylocity’s CTO Rachit Lohani shares: “Now more than ever, companies are focused on their people as their most important, and often most expensive, asset.
“Despite this focus, most headcount planning still tends to happen through slow, manual planning cycles that are siloed within departments, rely on tools like offline spreadsheets, and are disconnected from key systems like HCM platforms.
“With this acquisition, Paylocity is looking to solve that problem by extending our platform to include headcount planning.”
Lohani continues: “This acquisition builds upon Paylocity’s history of strategic acquisitions to enrich our product portfolio and advancing our mission to provide the most complete HCM platform for the modern workforce.”
Between them, Trace and Paylocity serve brands like Guild, Lucid, Weigel’s and Noble House – so what impact will the acquisition have on the pair’s clients?
Lohani tells UNLEASH: “For our clients, this will enable them to make and implement headcount decisions in real time, rather than relying on slow, manual planning cycles.
“Paylocity will integrate Trace’s market-leading and innovative capabilities in combination with our existing product portfolio to deliver a new unified experience for headcount planning; all within the modern platform that our customers have come to expect from Paylocity.”
The integration of Trace into Paylocity’s HCM platform will empower HR leaders with real-time insights, enabling them to address talent challenges proactively.”
Trace’s CEO and co-founder Mike Gonzalez added: “We built Trace to help organizations manage their most important investment—their people.
“And we are excited to continue that mission with Paylocity, given its reputation for solving business challenges with innovative technology. Together we can better enable businesses to optimize headcount planning as part of their overall HCM strategy.”
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Chief Reporter
Allie is an experienced business journalist and can be reached at alexandra@unleash.ai.
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