The Carlyle Group acquires payroll solution BenefitMall

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fintech insurtech wealthtech regtech ai cybertech esg news

Employee benefits and payroll services BenefitMall has been acquired by the Carlyle Group, from an investor group led by Austin Ventures.  

Founded in 1979, the company offers a range of payroll and benefits solutions, including: online payroll, tax and compliance, insurance products, HR services and employee management, among others. Dallas-headquartered BenefitMall serves 200,000 small and medium-sized businesses and partners with a network of 20,000 brokers and CPAs.

BenefitMall initially received a $40m round of venture investment in 2000. The equity was led by Technology Crossover Ventures, and saw participation from Morgan Stanley Ventures and Austin Ventures.

The buyout-giant used its Carlyle Global Financial Services Partners II vehicle, which has a $1bn capital pool to back financial firms, globally. Earlier in the year the firm bought insurance software developer Prima Solutions, using its €657m Carlyle Europe Technology Partners III fund.

Carlyle managing director Jim Burr said, “Through capital investment, an expanded salesforce, and Carlyle’s industry experience and network, we believe BenefitMall can expand and take significant market share as the demand for integrated benefits, payroll and related products and services continues to grow within an increasingly complex regulatory environment.”

Last week payroll solution Inova Payroll completed a recapitalisation by Tritium Partners. Alongside this investment, the company merged with Atlanta-based Payroll Strategies. Other recent activity in the payroll sub-sector was HR Knowledge acquired by The Hibb Group, and CoAdvantage acquired PEMCO in an undisclosed deal.

Investments in the infrastructure and enterprise software sector is fairly evenly split across the sub-sectors, with HR/payroll representing the fourth biggest area for funding. While this is only the fourth largest, with $408m deployed, it is only $112m behind the highest funded sub-sector.

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