Arctic Shores, the pioneer of behavioural assessments that combine neuroscience, AI and game technology to generate data-driven people insights, has raised £5.75 million. The Series B funding round was led by Praetura Ventures and Calculus Capital. Beringea, an existing investor, also participated.
Arctic Shores last raised funds in September 2019. It raised £5.5 million in the Beringea-led round. Such a small uplift between the two rounds could be for several reasons. Arctic Shores raised 1.5 million in a debt financing round in January 2022 from Silicon Valley Bank, UK. This could have limited the amount raised. It may be that this is just the first part of a multipart Series B round as the company looks to fund further growth. It may also be a reflection of the wider market.
However, the release did not reveal any valuation for the company. It also failed to release any revenue details as it looks to scale. For a Series B round, this is not a huge amount. Arctic Shores aims to provide a means for companies to discover high-quality candidates without the manually intensive processes associated with selection, such as CV Screening and traditional testing. It plans to use the funding to expand internationally and accelerate the development of its soft skills assessment, including its new self-configure platform.
The international expansion will focus on Europe initially. It already has a foothold in the German market and has won major contracts with Airbus Siemens and Schneider Electric. The company has also had good success with its platform. Organisations such as AXA, Capita, Vitality, PwC, Thales, TalkTalk and Arcadis are leveraging its platform. It gives them access to over 3 million candidates. Arctic Shores has already helped improve the hiring quality and reduce the hiring cost.
What happens next at Arctic Shores
Robert Newry, co-founder and CEO of Arctic Shores, said: “This next phase of investment will help Arctic Shores to realise its mission to help companies see more in people and transform recruitment so that potential will count as much as hard skills or experience. Companies are being squeezed by a lack of specific skills which is driving up salaries and recruitment costs.
“On top of that, there is a cohort of experienced workers soon to retire, and an increasingly digitised economy creating many new roles for which no prior experience exists. If companies recruit in the same way they have always done, then they will fail.
“Arctic Shores gives businesses a unique and proven way to escape this experience trap by assessing for potential so that companies can train up the skills. Companies like PwC, Siemens and Airbus are leading the way into the future by recognising that the CV is no longer fit for purpose and adopting a soft skills centric hiring approach.”
New investors see opportunity
Firms are shifting their thinking towards a greater emphasis on soft skills. Arctic shores are well placed to take advantage of this shift. Organisations are reducing the emphasis on technical skills and qualifications and the CVs that detail them. Instead, there is a focus on the potential of using softer skills as a benchmark. The challenge is how to measure those. Arctic Shores provides one answer.
Helen Verwoert, operational partner at Praetura Ventures, said: “The recruitment landscape is changing rapidly. The challenges employers face today are fundamentally different to those we’ve seen in previous years. And new challenges need new tools. As we scaled the team at Dr Martens, we constantly looked for new and innovative ways to help us develop our edge in the ‘race for talent’.
“Arctic Shores’ platform gives its clients that edge by broadening the talent pool, hiring based on real skills and removing bias from outdated practices. I look forward to supporting them with Praetura’s More Than Money promise as they continue to grow.”
Alexander Crawford, co-head of investments Calculus Capital, added: “Arctic Shores has developed a fantastic platform which empowers employers to see the candidate’s potential, reduces bias, and makes hiring decisions backed by data. On top of that, it has an impressive list of clients in over 40 countries. Arctic Shores is run by a strong and experienced management team, and we look forward to working with them to grow and scale the company over the next few years.”
Both Verwoert and Crawford will join the board as the firm looks to capitalise on the lack of unconscious bias its platform offers. It presents the best candidates and helps improve diversity in the workforce.
Enterprise Times: What does this mean
The funding will give Arctic Shores a new lease of life and an opportunity to grow further. It comes when organisations are looking for their HR teams to do more with less. While this funding round seems much smaller than other Series B, it could be enough in this market to push Arctic Shores forward.
It will be interesting to see whether there is further investment in a few months based on improving ARR and a new valuation. Alternatively, could Arctic Shores become an acquisition target for someone like Cornerstone, iCIMS or UKG?
