Germany-based HERO Software, a SaaS platform for tradesmen SMEs in the DACH region, has closed €40 million in Series B funding. The round was led by Eight Roads Ventures (which backed Flywire, Hibob, Spendesk, and Tibber) alongside existing investor Cusp Capital. In addition, Federated Hermes also participated in the investment round.
Funds utilisation
With the new funding, HERO Software plans to invest in its team, and new talent, expand into new markets, and further develop its SaaS offering to continue its mission of helping small and medium-sized trade businesses succeed.
Investors’ views
“At Eight Roads we have witnessed many successful stories in Vertical SaaS, and HERO stands out for its comprehensive product and experienced team. We’re excited to be backing their growth journey,” said Lucile Cornet, Partner at Eight Roads Ventures. “We strongly believe that vertical SaaS will enable entire industries to become more digital and sustainably successful – which is one of our investment thesis’ at Eight Roads Ventures.”
“Michael and Philipp are building a best-in-class product, an incredible team, and achieving strong commercial traction – it has been a pleasure to witness their growth since leading their Series A,” added Dr. Maximilian Rowoldt, General Partner at Cusp Capital. “One of the beauties of building an industry-specific operating system is the potential to add functionalities on top of the core software and the resulting levers that enhance your customer’s success. We look forward to continuing to support the entire HERO team in implementing its ambitious strategy.”
“HERO has played a pioneering role, and remains at the forefront of digitising the business operations of a traditional industry in DACH. We look forward to being part of the next phase of growth, and supporting the strategy of the ambitious management team alongside investors Cusp Capital and Eight Roads,” commented Fidel Manolopoulos, Co-Head of EMEA Investment at Federated Hermes.
What challenge does it address?
The tradesmen industry represents the backbone of the economy, contributing as much as 12% of the GDP of many European countries. At the same time, tradesmen are also crucial to achieving Europe’s ambitious climate targets. Consequently, there is a significant demand for ERP systems tailored to the needs of tradespeople, offering industry-specific solutions to help them tackle their daily challenges.
Founded in Hanover in 2020 by Dr. Michael Kessler and Philipp Lyding, HERO Software’s platform enables trade business owners and employees to manage all their core workflows in one place, while field workers can access all necessary information on-site.
What does the company do?
HERO Software offers trade businesses in all sectors intuitive and comprehensive business software that digitises the entire operational process. From the first customer contact and the preparation of quotations to the implementation and documentation of the construction site and final invoicing – all data-driven processes are digitally mapped and available on various end devices at any time thanks to cloud technology.
It acts as an operating system for SMEs across various trades, including plumbing, carpentry, photovoltaic installation, and electrical services. From the first customer contact and the preparation of quotes, to the planning and execution of projects on-site, and to the invoicing and payment, all processes are digitally mapped and available at any time on various end devices.
With more than 20,000 tradespeople already relying on HERO and generating annual sales of around €3.1 billion.
“Going forward, we are planning to make everything around financial transactions for our customers as easy and smooth as possible. Additionally, we will focus on integrating third party tools & services to our platform to save even more time and thus improve the margins of our customers”, said Dr. Michael Kessler, founder and CEO of HERO Software.
What do we think about HERO Software?
The company is well-positioned for growth with its recent funding round, which will help it expand its team, market presence, and SaaS offerings. By digitising tradesmen SMEs’ workflows, HERO addresses industry-specific needs, boosting efficiency and customer success.
