Sanish Mondkar recognized there were major disconnects between businesses and their employees while on a lengthy U.S. road trip years ago.
That may seem clear to late-stage capitalism skeptics. Mondkar, a Cornell computer science master’s graduate, believes witnessing the challenges firsthand made all the difference.
“Traveling from town to town, I noticed the perpetual ‘for hire’ signs on the windows of countless labor-intensive businesses like retailers and restaurants,” he remarked. At the same time, I witnessed workers often changing jobs yet failing to earn a livelihood. This gap between employers’ demands and workers’ realities struck me.
Based on this expertise and his time as EVP and CPO at SAP’s Ariba, Mondkar founded a firm that helps organizations manage their contract and gig workforces. Legion, his startup, secured $50 million today from Riverwood Capital, Norwest, Stripes, Webb Investment Network, and XYZ.
“My goal was to rebuild the enterprise category of workforce management to maximize labor efficiency for businesses and deliver value to workers,” Mondkar stated. “I wanted to differentiate the company with intelligent WFM automation and an employee value proposition.”
Legion helps Cinemark, Dollar General, Five Below, and Panda Express manage their hourly personnel by automating choices like labor deployment and scheduling. Legion’s technology develops work schedules using demand predictions, labor optimization, and employee preferences.
Legion firms’ employees may use the mobile app to request work hours and workstyle. Legion’s technology then aligns worker preferences with corporate requirements.
Mondkar said Legion gathers third-party data from its partners and trains algorithms on a mix of client and third-party data. “This integration allows forecasts for planning and resource allocation.”
Legion is using Copilot, a generative AI tool, in addition to scheduling features, which is trendy. Copilot answers workplace inquiries based on employee handbooks, labor rules, and training. In future months, Copilot will be able to summarize work schedules and fulfill requests to add or subtract shifts or adjust staff assignments.
Mondkar advised hourly labor firms to provide gig-like flexibility to attract and retain workers. Legion automates scheduling intelligently. Managers may match workers to predicted demand, bridging the employee-business gap.”
Legion’s privacy policy and earned wage access (EWA) scheme bother me.
Legion defaults to storing client data for seven years, which is lengthy. More troublingly, the data contains workers’ first and last names, email and home locations, ages, photographs, and job preferences. Yikes.
Legion asserts that the data is essential for “facilitating scheduling in compliance with labor regulations,” yet users have the ability to remove it at any time. I doubt how easy erasure is and how clear Legion is about its data retention practices.
My second issue with Legion is InstantPay, an EWA scheme that allows workers to withdraw part of their income before payday. Legion’s rapid earned-wage transfers cost $2.99, whereas next-day transfers are free. For low-paid workers, this may add up. Legion claims this allows hourly workers “greater flexibility” and “control” over their cash, as well as helping to retain the company. Legislators, consumer rights groups, and employers scrutinize EWA programs.
Consumer organizations argue that EWA programs should be considered loans under the U.S. Truth in Lending Act, which requires lenders to notify them before raising fees. These organizations claim EWA initiatives compel overdrafts and interest charges.
Additionally, EWA initiatives may not benefit companies. To reduce attrition, Walmart reportedly paid hourly workers early. Instead, EWA users quit quicker.
Despite my complaints, Legion’s income and bookings have grown by 55% and 125% in the last year, despite competition from Ceridian’s Dayforce, Quinyx, and UKG. Despite VC interest, HR IT startup financing plummeted to a three-year low of $3.3 billion last year, down from $10.5 billion in 2021.
Legion, which charges subscribers based on hourly workers, wants to use its newly secured funds to build its 200-person workforce, focusing on R&D, customer-facing, and European go-to-market operations.
The Legion has raised $145 million.
Mondkar said Legion would spend more in R&D to innovate workforce management. Legion’s focus on labor-intensive businesses has largely protected us from the IT slump. This strategic synergy helps us weather economic headwinds.”
