Next-generation training and onboarding of warehouse workers: Why we invested in How.fm
We’re announcing our backing of How.fm, the Cologne-based company that has created a warehouse worker training platform to help onsite managers quickly enable and retain workers. This marks a €5m Seed round, led by us and joined by Kindred Capital, Capnamic and business angels Here’s why we invested in How.fm to help solve global workforce staffing challenges.
The warehousing market has seen the greatest increase in workforce staffing to date, and this trend shows no signs of slowing in the coming years. Projections tell us that a 50% increase in the workforce will be necessary by 2025 to meet demand sparked by the pandemic and the global shift toward eCommerce.
As a result, it’s expected that new warehouses will be added to the existing 150,000 around the world. Most of these new builds will be direct-to-consumer fulfilment centers. It’s clear that staffing will be on everyone’s minds — and automation will be the key to managing high order volumes and short delivery times. Warehouse managers need a better way to train, onboard, upskill and retain logistics workers.
How.fm is digitizing the way logistics workers are being deployed and managed
Today’s onsite managers are experiencing roadblocks in training, upskilling and deploying workers at a pace that matches demand. Slower lead times are causing losses in the thousands of euros, which in turn reduces resources to attract and retain talent.
Let’s look at the numbers:
- 59% of site managers are reporting an inability to attract and retain qualified workers
- 39% report difficulties in retaining supervisors
- Turnover is also high at an average of 60% for long-term workers and up to 420% for short-term employees.
- Over 35% of warehouses are exposed to seasonal surges of over 20% and 8%, requiring an increase in the workforce of 100% or more
This combination of factors results in significant operational pressure.
With such high turnover, site managers must find a way to enable workers with a lower time-to-value. Right now, most logistics warehouses don’t have appropriate onboarding processes to handle this task (only 29% of warehouses are able to bring new workers up-to-speed in less than a month). Logistics contractors report issues such as lack of onboarding, unfit training staff and language barriers.
We believe that How.fm’s worker-centric, multi-language platform can quickly provide value to these organizations by creating worker-generated content, retaining that knowledge for future workers and disseminating it in a way that is relatable and understandable.
Why we invested in How.fm
“The logistics industry is under immense pressure to deal with the constant increase in e-commerce, and most logistics contractors have very antiquated onboarding processes,” says Jan Borgstädt, Join Capital Founding Partner.
“Andreas and his team impressed us with a very short proof-of-value when we introduced them to 4 prospective customers in our network. We liked the execution power that drives the founders as well as their positive resonance within Join’s network, who, within minutes, unanimously recognized the potential added value of How.fm in their day-to-day logistics operations.”
Andreas Kwiatkowski, co-Founder of How.fm, also adds: “Join has proven to be a very engaged and helpful partner already — especially in providing access to their industry and advisor network, with plenty of customer introductions early on.”
We chose to invest in the company based on these criteria:
- A team with a strong entrepreneurial mindset. Having previously founded and exited another startup, Andreas and Farhoud are no strangers to building a successful company.
- A clear market need validated by several prospects within our network. All prospects followed up with pilot signings. Just four sets of 30 minutes calls yielded extraordinary results, and we believe there’s plenty more to come.
- An easy, plug-and-play model that allows for short time-to-value, and therefore short sales cycles, in a fast-paced industry. Given the absence of clear onboarding and training processes, customers are intrigued by How.fm’s technology.