HR tech company VirgilHR raised a $1.5M pre-seed round

Employment and labor law compliance technology company VirgilHR today announced the closing of a $1.5M pre-seed raise with support from funders throughout and beyond its home state of Maryland

Baltimore’s Squadra Ventures and Alexandria, Virginia-based SHRMLabs participated in the round alongside State of Maryland-connected TEDCO (which contributed $200,000) and international entrepreneurship support vehicle Techstars. The Gaithersburg-based company’s statement said it will use the funds to support product development, as well as the release of new modules and targeted marketing. The raise announcement arrived about a week before VirgilHR is set to graduate from the Techstars Workforce Accelerator in Denver, Colorado.

VirgilHR, founded in November of 2021, built a web portal and smart chatbot to help HR professionals find regulatory requirements and other information. This, the company said, will help these workers make informed employment and labor law decisions with ease and credible research.

Founder Jocelyn King has worked in human resources for over a decade, with roles at 2U, Target, Cybrary and more. She told Technical.ly that in those roles, which often had employees in multiple states and localities, she and her team members found it increasingly difficult to keep track of the thousands of federal, state and local labor laws. While she sometimes worked with attorneys, the services were sometimes too costly for the company’s budget and occasionally did not yield answers to time-sensitive questions until a few days later.

“[Labor laws] change all the time, they supersede each other, they run concurrently and there are thousands of them,” King said. “So it was really difficult for us to track that and it was creating a situation in which we were putting ourselves at risk, as an organization, by not being compliant — simply because we don’t know.”

So, she created VirgilHR to help. The five-person SaaS startup’s platform includes information and guidance modules on worker leave, wages, hours, equal employment opportunity protocol; the Americans with Disabilities Act and pay equity. King and her colleagues also intend to add content on job and worker classification; offer letters and other new hire documents; offer letters; non-competes and related restrictive covenants; and an onboarding component that will be released in the next four-to-six months. Users can customize subscriptions based on company size and location of employment.

King said the chatbot is very granular and can focus all the way down to a specific scenario a company is encountering. It looks at laws that run concurrently, determines which ones supersede the others and offers step-by-step guidance for companies to stay compliant and avoid lawsuits.

“The idea here is that we’re really trying to help HR save time so they can focus on more strategic areas of the business and control costs,” King said.

Although King said the chatbot is designed for midmarket companies of 250 to 1,000 people, she’s also found it helpful to very small companies without HR departments. Going forward, she hopes to create more content with small businesses in mind and incorporate AI and predictive risk for HR professionals. By late 2023 and into 2024, she hopes to explore international jurisdictions, as well.

King said that this raise, which can also pave the way for a seed round, was key for some of these goals. But as a small startup, getting support and validation from some of these power players was a huge step in itself.

“What we’re doing is very different than the solutions out there that exist today for HR to work with as they’re complying or trying to comply with these laws,” King said. “So, the validation was definitely a big one for us.”