Following a $7 million raise, Houston-based GoCo is looking to grow. Courtesy of GoCo

A Houston startup looking to digitize the human resources industry just completed a reassuring round of funding. GoCo closed its Series A funding round led by ATX Seed Ventures alongside UpCurve, Inc. at $7 million.

GoCo, which was founded by CEO Nir Leibovich, Chief Technology Officer Jason Wang, and Chief Product Officer Michael Gugel, is out to bring the much-maligned HR tasks into the digital world. The funding round brings GoCo's total funding to $12.5 million. Leibovich said the new capital will be allocated to hiring across all departments, further platform development to extend the breadth of offerings and to broadly expand the company's customer base.

"Today, we have 6,200 customers across the U.S. and around the world," Leibovich tells InnovationMap. "And we have 25 employees. We're looking to double and triple — if not quadruple — that across 2019."

The company has a solid partnership network with employee benefit insurance agencies like OneDigital and PayneWest, and general agencies like Word & Brown, to offer GoCo's technology as an enhancement to their existing insurance benefits services clients. GoCo also auto-syncs with leading payroll providers ADP, PayChex, Paylocity, Intuit Quickbooks and more, thus uniquely enabling businesses to maintain their benefits broker and payroll provider by integrating with GoCo's platform.

"This Series A and the potential addition of UpCurve's distribution channel to reach hundreds-of-thousands of new customers continues our mission to free SMBs and HR professionals from outdated and tedious administrative burdens. When these professionals look at current HR and benefits solutions on the market and think 'there must be a better way,' we are the better way," says Leibovich. "We want to be synonymous with modern and streamlined HR."

GoCo is backed by additional investments from Salesforce Ventures, Corp Strategics, GIS Strategic Ventures, the venture arm of Guardian Life Insurance, and Digital Insurance, the largest employee benefits-only company in the US. ATX Seed Ventures is investing for the second time.

"We are doubling down on our investment in GoCo, as it is positioned to become the platform of choice for HR professionals to break out of the chains of outdated and complex HR duties, and empowers them to spend more time on their employees and higher value tasks," says Chris Shonk, managing partner at ATX Seed Ventures, in a release. "GoCo is simply the best platform solution to do all this, and their increasing customer base supports it."

Founded in 2015, GoCo is the fusion of modern, paperless HR functions like employee onboarding, secure cloud-storage document management, eSignature workflows, time-off tracking and HR data reporting. As well, it is paired with simplified benefits enrollment and management, payroll sync and HR compliance enablement. The web and mobile based app empower employers to give employees 24/7 access to the full spectrum of a company's HR and benefits offerings.

GoCo creates platforms to onboard employees, conduct training and myriad HR tasks which, said Leibovich, free up HR personnel to handle the business of actually working with employees to grow their potential and assist companies with their missions.

"Typically, HR has lagged behind when it comes to embracing technology," says Leibovich. "Sales, marketing, development, these are places where it's become the norm to seek out tech solutions to problems. With human resources, many firms are still using that paperwork model, and often, a new hire's first day on the job – and therefore their first impression of a company — is filling out forms."

Leibovich had founded two companies before, one based in analytics that they sold to Zinga, the other a biotech firm. It was the biotech venture that brought the Austin-based trio to Houston. Looking around the landscape, Leibovich said he and his partners liked the fact that Houston was a city on the move, with a highly skilled workforce and companies keen on finding tech solutions to their challenges. The city's "if you can dream it, you can do it here" vibe kept the group here as they launched GoCo. Leibovich said he thinks that, in terms of its startup ventures, Houston is where Austin was 10 years ago. And he believes that continued successes in the tech and startup culture will breed more success in the Bayou City.

"This is an ecosystem that is coming together to attract even more talent for ventures like this," he said. "Funding is going to ramp up, and we see Houston as a place where we — and other companies — can create something really special. This is a great place to do business."

All-in-one platform

Courtesy of GoCo

GoCo is the fusion of modern, paperless HR functions like employee onboarding, secure cloud-storage document management, eSignature workflows, time-off tracking and HR data reporting.

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Greentown Labs appoints Houston founder among 4 new board members

All a-board

Greentown Labs, a Massachusetts-based climatetech startup incubator with its secondary location in Houston, has appointed four new board members.

Of the new appointees, two community board members have been named in order to act as liaisons between startups and Greentown Labs. Greentown Houston's appointed representation is Nisha Desai, founder and CEO of Intention, and community member. The other new board members are Gilda A. Barabino, president of Olin College of Engineering and professor of biomedical and chemical engineering; Nidhi Thakar, senior director of resource and regulatory strategy and external engagement for Portland General Electric; and Leah Ellis, co-founder and CEO of Sublime Systems, who is the Sommerville location's community board member).

"It is important for a startup incubator to have leadership and insight from stakeholders including the public and private sector, academic and university communities," says Greentown Labs CEO Dr. Emily Reichert in a news release. "These leaders bring a wealth of knowledge relevant to not only climatetech but to our continued growth as an organization. Their voices will be important to have at the table as Greentown charts its course for the next decade of climate action."

Desai's current startup, Intention, is climate impact platform for retail investors, and she has previously worked at six energy-related startups including Ridge Energy Storage, Tessera Solar, and ActualSun, where she was co-founder and CEO. She's also worked in a leadership role at NRG Energy and spent several years as a management consultant with the energy practice of Booz Allen Hamilton — now Strategy&, a PWC company.

"I'm honored to join the board of Greentown Labs as a representative of the startup community," she says in the release. "This is a pivotal time for climate and energy transition. I look forward to working with the rest of the board to expand the collective impact of the Greentown Labs ecosystem."

The four new appointees join seven existing board members:

  • Alicia Barton, CEO of FirstLight Power (Board Chair)
  • Katherine Hamilton, Chair of 38 North Solutions
  • Dawn James, Director of US Sustainability Strategy and Environmental Science at Microsoft
  • Matthew Nordan, Co-Founder and Managing Director of Prime Impact Fund and General Partner at Azolla Ventures
  • Kathleen Theoharides, Secretary of Energy and Environmental Affairs, Commonwealth of Massachusetts
  • Mitch Tyson, Principal at Tyson Associates and Co-Founder of the Northeast Clean Energy Council
  • Dr. Emily Reichert, CEO of Greentown Labs

Houston fund makes first local investment in $8M deal

money moves

A Houston-based investment fund has announced its its latest deal that includes an investment into a local direct-to-consumer supplement company.

GP Capital Partners has invested in Qualitas Health, known as iwi, which produces plant-based omega-3 and protein products that's sold directly to consumers as well as retailers across the United States. Iwi's nutrition supplement is sustainably sourced from the company's cultivation pond systems, which are the size of football fields and located in New Mexico and Texas.

“We are excited about our investment in iwi. They have a proprietary and scalable process to create in-demand products in a sustainable manner," says Gina Luna, principal of the fund, in the news release. "We look forward to working with iwi’s management team as they pursue this transformative opportunity.”

The $8 million deal — $5.5 million in senior secured term debt and a $2.5 million direct equity investment — will help iwi accelerate sales of its existing products and ramp up development, marketing, and growth of new protein-based product, according to the release. Iwi will also enter new international markets.

“The iwi team looks forward to working with GP Capital Partners following their investment in our growing company. We have big plans for accelerating our growth, and are pleased to partner with this team that brings both expertise and relationships to support us in this new stage of the company," says Miguel Calatayud, CEO of iwi, in the release.

Outside of GP, the Houston company's other investors include Grupo Indukern, Gullspång Re:food VC, PeakBridge VC, , Arancia Group, Trucent, SASA, and Minrav. GP launched its $275 million fund last year. It's structured as a Small Business Investment Company and will deploy funding into 20 to 25 companies within the Gulf Coast region.

The supplement company is based in Houston. Photo via Instagram

How company behavior guides activists’ choices, according to this Houston researcher

houston voices

It’s been more than 100 years since Pavlov’s dog showed the world that behavior is often guided by forces we don’t comprehend.

The same is true of the interaction between companies and protestors, according to Rice Business professor Alessandro Piazza and Fabrizio Perretti of Bocconi University in Milan. In a recent study, the scholars show that when protestors fight to change a company’s policy, their future choices of where and how much to protest are shaped by the company’s response.

Moreover, the outcome may not be what either group has planned for. Companies that meet protestor demand often inadvertently spur the protestors to demonstrate further; conversely, companies that refuse to give in tend to propel protestors to redirect their energies toward related but different issues.

The researchers based their conclusions on a deep dive into the anti-nuclear movement of the 1970s and 1980s, and a close analysis of protests and company responses in specific locations.

During the time period studied, the researchers found, public sentiment toward nuclear energy changed from mild support to open hostility in the form of an organized protest movement. To quantify this movement’s impact on nuclear power plant construction, the researchers studied the aftermath of protestors’ local victories.

In Massachusetts, for example, the first nuclear power protest in 1974 persuaded Northeast Utilities to postpone, and then permanently cancel, its plant. This reaction, Piazza and Perretti found, catalyzed local protestors. In the years that followed, the region became one of the United States’ strongest bastions of anti-nuclear activism.

In order to quantify how company actions affected protests, the researchers first measured the number of U.S. protest events by geographic location from 1970 to 1995. They then compared this number to the number of nuclear facilities either completed or cancelled over a one-year time period within 100 miles of a given demonstration. They included controls to account for local economic and political differences upon local activism, and for any geographic bias of the newspaper sources used to identify protest events.

The patterns they found were intriguing. Proposing a new plant for construction boosted anti-nuclear protests by 18 percent in a 100-mile radius. Cancelling construction of a plant drove a 27 percent increase in anti-nuclear protests. And when a new nuclear plant was completed and connected to the grid, the researchers witnessed a 2.3 percent increase in the number of protests not directly aimed at nuclear power plants.

The reason for the increase in other protests when a company prevailed and built a power plant? The researchers hypothesize that each time a plant was completed, demoralized activists attached themselves to other movements.

These results raised a related question. Did company decisions on one type of controversy, such as a nuclear power plant, lead to greater support for related protest movements or for unrelated ones? The former, it turns out.

To measure this, the researchers again looked at protests within given regions and categorized them into anti-nuclear weapon protests, environmental protests, public policy protests, anti-war protests and protests against the proximity of a given plant to a specific property, that is, “not in my backyard” protests.

Nuclear power opponents, they found, were most likely to turn to adjacent issues such as protests against nuclear weapons. Protest activities, in other words, have a domino effect.

While most research tracks the effects of activism on companies, Piazza and Perretti’s study shows that the way companies act is also a critical event driver. Company choices can actually drive the evolution of activism, triggering activist mobilization in other causes.

The research represents a challenge to traditional explanations of activism, which usually assume that mobilization and protests are most effective early on then dwindle over time, regardless of the behavior of the organization.

Piazza and Perretti’s findings suggest a valuable lesson for companies, especially those operating in more than one location: Their decisions in one place may actually escalate activism elsewhere. Pacific Gas & Electric successfully acted on this insight in the 1980s. Working with the Sierra Club, the company swapped the cancellation of one site at Bodega Bay, California — the target of frequent protests — for support of a plant at a second site elsewhere in the state at Diablo Canyon.

The findings also offer important insight for activists choosing a company on which to focus. These activists should keep in mind that the companies most likely to capitulate are also the ones most likely to feed a movement going forward — providing, in effect, the possibility of a double win.

Meanwhile, even if they fail in one effort, activists can take heart that their energy isn’t necessarily wasted. Only a little further afield, a similar movement may gain momentum from demoralized protestors looking for a new cause.

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This article originally ran on Rice Business Wisdom and is based on research from Alessandro Piazza, an assistant professor of strategic management at Jones Graduate School of Business at Rice University.