Deel Expands Its Footprint by Acquiring Hofy to Establish In-House IT Device Management Service

In a significant move, the rapidly expanding payroll solution Deel has completed its third major acquisition this year.

This Thursday, Deel revealed it has taken over Hofy, a company situated in London that specializes in distributing and managing office supplies for individuals working remotely. Although the specific financials of the transaction weren’t disclosed, a source well-informed on the matter shared with TechCrunch that the purchase price exceeded $100 million.

Alex Bouaziz, Deel’s co-founder and CEO, mentioned that this acquisition will enhance Deel’s integration with Hofy’s offerings due to a pre-existing partnership. He disclosed that this is a stepping stone towards the introduction of a new IT product from Deel named Deel IT.

“We are gearing up to launch Deel IT later this year, incorporating software provisioning, app access control, integrations with tools for mobile device and identity management, and comprehensive lifecycle management to deploy, reclaim, repair, and replace devices,” explained Bouaziz. “This will furnish our clients with a fully integrated IT suite, solidifying Deel’s position as the comprehensive solution for HR needs and global business expansion.”

Sami Bouremoum and Michael Ginzo, the co-founders of Hofy, along with their leadership team and 120 employees, are set to join forces with Deel to develop Deel IT. Bouaziz assured that Deel intends to assist Hofy’s current clientele in transitioning to the Deel platform smoothly.

“There will be no disruption in service for existing customers of both Deel and Hofy,” Bouaziz stated.

Bouremoum, formerly a consultant with Bain & Company, and Ginzo, who previously oversaw product development at Deel, initiating Hofy during the onset of the pandemic in 2020. The pivot to remote work played to Hofy’s advantage, meeting the critical need for businesses to manage the setup and decommissioning of workstations at employees’ homes.

Hofy’s integration with HR systems enabled the establishment of guidelines for device budgeting and policy enforcement. The platform allowed new staff to pre-order their necessary equipment such as laptops, monitors, smartphones, and peripherals before their first day.

Hofy was committed to ensuring support for its customers, providing interim devices for those needing repairs. It also took charge of the offboarding process, offering remote device wiping before collection and facilitating HR software vendors to incorporate hardware delivery and retrieval as a managed service through its APIs.

Prior to joining Deel, Hofy had successfully broadened its client list to more than 700 companies, including notable names such as Forbes, GoDaddy, HelloFresh, and Canva. It also secured over $30.2 million from investors like CNP, Stride, 20VC, and Day One Ventures. Bouremoum conveyed to TechCrunch in a 2022 interview that Hofy had achieved profitability.

Bouaziz shared that a driving force behind the acquisition was the demand from customers for assistance in equipping their remote workforce. This, coupled with Deel’s firsthand experience with Hofy, precipitated a deeper engagement beyond mere partnership.

For Deel, now valued at upwards of $12 billion and having raised $630 million in funds, acquiring Hofy represents a strategic enhancement in consolidating its position within the payroll management sector.

Deel primarily offers international payroll processing and hires employees for companies via its local entities, ensuring compliance with local employment laws. The company also aids with contract creation in accordance with local labor laws, helps employees gain health insurance, and provides guidance on immigration and visa processes.

Earlier in the year, Deel expanded its portfolio by acquiring Zavvy, a Munich-based “people development” startup, followed by PaySpace, a payroll solution originating from Africa. Subsequently, Deel announced it had reached $500 million in annual recurring revenue, boasting a workforce of 4,000 employees and serving over 35,000 customers.