Annual Industry Survey
HR-tech in emerging markets:
key takeaways
HR&ED-tech venture fund presents
a comprehensive Survey of the HR technology industry in emerging markets
We analyzed the state of HR-tech in Latin America, India, the Asia-Pacific region, the Middle East
and North Africa. Our fund analysts conducted interviews and surveys with market representatives
We also used reports from consulting and research organizations; Dsight, Owler, Crunchbase, Dealroom, TechCrunch, and Pitchbook platforms; and other independent sources
  • Oksana Pogodaeva
    Managing partner of the HR&ED-tech venture fund
    In 2022, the HR market experienced a transformation and faced audacious challenges. To assess the dynamics of the changes, the scope and prospects of the HR industry in the new economic reality, we analyzed the state of emerging markets in the MENA and LATAM regions and India. We have selected markets that are of a priority to our fund, where our focus and experience are particularly strong

    HR tech leaders, startup founders and investors in the sector have commented on the findings of our analysis. In this presentation you will find answers to the following questions: what technologies are shaping the current market, what are the main needs and challenges facing the industry, and what strategies have become a priority

Global market
Despite global changes, HR tech continues to increasingly garner attention. HR tech startups are raising capital to meet the growing demand for employee-centric solutions
The main investment region is the US, which accounts for about 60% of the global investment in HR tech

Investors are interested in projects that deal with training and career guidance (in particular, those that are aimed at young professionals), competency assessment, mentor platforms, job boards, talent recruitment and talent management platforms, and professional networking startups

According to various estimates, the size of the global HR tech market in 2022 increased from $25 to $31.5 billion. The predicted market growth rate is 9.08% per year between 2023-2028. Future Market Insights expects the HR tech market to grow to $63.6 billion by 2032, IMARC Group predicts market growth to reach $53.3 billion by 2028

Distribution of global investments in HR-tech
by rounds
Investors are focusing on new startups and less often invest in the later stages. The largest number of investments in 2022 was made in series B funding (with an increase from 11.5% in 2021 to 26.7% in 2022), making it one of the most sought-after niches

Around half (47%) of all deals in 2022 were made in series C and later, while it made up 70% in 2021

Distribution of investments in the
HR tech segment by regions
The investment market has become more geographically dispersed across the regions as North America's share of overall HR tech valuation has declined from 65% in 2021 to 55% in 2022. The share of the EMEA region (Europe, Middle East, Africa) shows an increase from 23% in 2021 to 30% in 2022
The following niches dominate the volume of investments:
Structure of DEALS
13 %
$ 1,6 billion
talent development
37 %
$ 4,5 billion
talent acquisition
15 %
$ 1,8 billion
talent engagement
and motivation
Structure of transactions by type of solution (% of total in 2022)
  • Oksana Pogodaeva
    Managing partner of the HR&ED-tech venture fund
    We believe that startups developing solutions for the automation of basic HR processes, as well as in professional education, can be useful in emerging markets, and our survey confirms this. In 2022, we focused on studying the markets of MENA, LATAM, India, and Indonesia. Each country has its own cultural peculiarities, so it is necessary to deeply dive into HR processes, to adapt and refine the product to the needs of new customers. And what is important - a local partner in the chosen country. That is why in 2023, in addition to investments, we give additional value to incoming portfolio projects - advising from local experts on sales, marketing and recruitment.

Latin America

$1 bln (2022 г.)
$1,7 bln (к 2028 г.)
Market Size
Development Forecast
The Outlook of Average Annual Growth Rate
Investment Leader
  • attracting and retaining talent
  • learning
  • development
  • IT infrastructure
  • demand for digital solutions
  • growth of high skilled workforce
  • staffing shortages in North America + demand for LATAM employees
  • management of remote and temporary employees
  • focus on soft skills
  • low automation
  • bureaucracy
  • cybersecurity threats
  • problems with personal data protection
The most notable deals of 2022:
Source: IMARC Group, Owler, Crunchbase, Dealroom, TechCrunch, Pitchbook
  • Kira Kuzmenko
    Founder of the international recruiting agency NEWHR
    When we conducted a comprehensive study of Mexico's IT market, we saw that it is relatively small compared to markets in other countries, and HR-tech in the country does not stand out as a prominent industry. The local startups startups are mostly focused on FinTech and E-commerce. According to our data, Mexico has not changed its attitude towards Russian startups after the well-known events of last year.

    The main problem of the local market is its dependence on the USA, which leads to an outflow of more or less notable companies and specialists from the country to that region.
    Nevertheless, the number of IT professionals in Mexico is growing. Mostly, it is due to those who have been pumped through education and/or work in U.S. companies. The growing demand for remote working has also contributed to this, and some local professionals can now work out of the country without having to relocate. So digital solutions to adapt, improve training, productivity and employee engagement during the transition to remote work have been gaining popularity.

    But Mexico's local market is unlikely to be a big consumer of HR-tech. Perhaps the technology in this segment could be of interest at the level of large companies opening offices in Mexico and hiring a large staff, but there is a danger that they may already have their own HR system in place.
$940 млн (2022 г.)
$1,5 млрд (к 2027 г.)
Market size
Development Forecast
The Outlook of Average Annual Growth Rate
  • automation of HR functions
  • digital training
  • management of remote and temporary employees
  • adoption of AI technologies
  • remote sensing
  • team communication
  • partnerships with universities for career guidance and recruitment
  • talent support
  • insufficient level of digital skills
  • shortage of personnel with IT-skills
  • cybersecurity issues
The most notable deals of 2022:
Source: IMARC Group, Owler, Crunchbase, Dealroom, TechCrunch, Pitchbook
  • AI GPT
    Expert of The Orbit project on a search for mentors and experts in India, LATAM, MENA, and Indonesia
    Although the HR industry in India is growing rapidly and there are interesting HR tools in the local market, there are some gaps that open up new opportunities for innovation.

    India has a large talent pool, but the recruitment process is still costly and time-consuming. HR solutions aimed at streamlining and automating the hiring process, including scoring and AI-based assessment tools, can help companies find and hire the right talent more efficiently. Given India's regionally diverse population, there is a need for HR technologies that help companies create a more inclusive and diverse workplace. And with the rapid pace of technological change and digital transformation, there is a need for tools that help employees expand their skill sets and achieve individual, team, and corporate goals.

    The HR technology market in India is expected to show strong growth as more and more companies recognize the value of HR solutions. And we can expect an explosion of investment and innovation in this area in the future.

  • CS Srinivasa Rao
    Talent Acquisition Specialist, Jupiter.money
    The HR technology market in India is still young, so it has growth prospects. The next 10 years will be crucial for the industry. Right now, I think the most popular categories of HR solutions on the local market are talent acquisition and candidate management systems. In the future, the market leaders will be projects that offer non-standard, user-oriented solutions. I also see prospects in such areas as referral programs, process automation, new tools for recruiting and sourcing.
  • Abhishek Gaur
    Team Development Manager, Rain
    In the next 3 years, the local HR market is expected to be ~$5 billion. Such areas as performance management and EVP (Employer Value Proposition) will actively grow. Today, solutions in these categories are particularly lacking in the market. But Human Resource Management Systems (HRMS), which help companies manage and automate basic HR processes such as employee data storage, benefits management, timekeeping, and payroll, are very popular.
Asia-Pacific region
$5 млрд (2021 г.)
$8,9 млрд (к 2027 г.)
Market size
Development Forecast
The Outlook of Average Annual Growth Rate
Investment Leader
  • training and retraining
  • attracting and retaining talent
  • management
  • management of remote and temporary employees
  • rapidly growing fintech sector
  • digital learning
  • strong trend toward sustainability
  • hyperlocalization
  • short-term contracts
  • shortage of personnel with IT-skills
  • lack of qualified personnel
  • underinvestment in employees
  • gap between leaders and teams
The most notable deals of 2022:
Source: IMARC Group, Owler, Crunchbase, Dealroom, TechCrunch, Pitchbook
  • Vlad Ayukaev
    СЕО Startup Builder PVG
    One of the main challenges that concern all verticals in general and HR in particular is data sparseness. The penetration of technology can vary from one island to another. This has a big impact on the HR industry, because it is important to create a connection between talent and employers, and for this to happen both parties must at minimum find out about each other. In Indonesia, most often there is no digitized data about the company or about a potential employee, and there is no federal database of resumes. At this point, the market is very fragmented: recruiters in Jakarta may not be able to find people in Bali or Sulawesi.

    My impression is that the vast majority of Indonesionas are still looking for work through people they know. But there are some HR companies — most often these are headhunting agencies with their own database and they have various monetization models, for example access by subscription and a percentage earned for each person who acquires work.

    In addition to structuring and accumulating data, processes need to be automated. This is a hot topic that will definitely be taking off in the coming years. Indonesia is a country with a lot of paper bureaucracy. There they don’t have a labor code like the one in the Russian Federation, and the arrangement between the company and the employee is regulated by a few laws and the internal documents of the company. I think that full-fledged HR platforms are needed there that can manage employees and the corresponding paperwork: accumulated vacation days, end of year bonuses, social payments and contributions, medical insurance, and overtime.

    The second niche that I would pay attention to is the management of freelancers or offshore employees. Today, many people don’t work in the city or even in the country in which they are physically located, and this is a global trend. There are several complex issues that need to be addressed here. First off, it is the hiring process, onboarding such employees, paperwork and reporting to local regulatory authorities, and in some cases visa issues. Secondly, there is the fintech component: cross-border salary payments and early wage access. I think that this area will be actively explored by HR teams around the world and, of course, in Indonesia. For investing, this is also a reliable B2B business.

    The last segment that I have long believed in is services that help build a career track. Currently there are many applicant tracking systems, but the world is already ready for career tracking systems. Since talent has become more mobile, and work has become more often remote, I expect there will be services that will build a career path for a certain talent, show possible development paths in different countries, propose the best companies, and assist with motivation letters and resumes.

  • Yerzhan Ryskaliev
    Co-founder of Clockster
    Indonesia is a rapidly growing IT market with a large population. Most of the businesses here are well-known brands from Europe and Asia, which leads to high quality standards and service requirements. This stimulates market consumption of productivity IT products.

    The situation with the local HR market has stabilized and we see positive dynamics: the post-COVID period has begun to bear fruit, attracting a large number of foreign high-quality solutions, which local players are trying to keep up with, in turn creating strong competition that attracts large investors from all over the world.

    In Indonesia, there is a big problem with the quality of talent and to address this issue, training and skills development systems need to be introduced. Another promising area are the systems for improving productivity and communication in all industries, as well as the development of EdTech platforms for businesses of various sizes.