NetSuite buys TribeHR, enters HR software market

NetSuite on Tuesday said it will acquire TribeHR, which makes human capital management software for small and mid-sized businesses. The move couples NetSuite's enterprise resource planning cloud software with HR tools.

What remains to be seen is whether NetSuite ultimately uses TribeHR to pitch larger companies on HCM software. Such a move would pit NetSuite against Workday. For now, NetSuite noted that it will partner with Oracle on HCM for large companies and use TribeHR for subsidiaries and smaller firms.

Terms of the TribeHR acquisition weren't disclosed. TribeHR is in NetSuite's developer network and has more than 450 customers in 50 countries. TribeHR started developing apps on NetSuite's developer platform and the two companies have 30 joint customers.

NetSuite added that it plans to use TribeHR to complement its payroll services.

In a statement, Zach Nelson, NetSuite CEO, said that TribeHR's interface encourages collaboration and activity. TribeHR's software manages employee information and administration, recruiting, talent management, social HR and mobile collaboration.

One open question for the NetSuite purchase of TribeHR revolves around how it affects other HCM partnerships. For instance, NetSuite in May touted HCM partnerships with Ascentis, CloudPay, Dell Boomi, NOVAtime, SilkRoad, TransCard as well as TribeHR.

A spokesperson for NetSuite said "partners such as CloudPay, NOVAtime and Transcards are still great compliments to NetSuite and TribeHR, and will continue to be relied on as valued partners."

However, not all HCM partners are going to fit. NetSuite said it will continue to work with HCM companies that fill gaps for things like global payroll, background screening and learning. NetSuite added that it will "continue to partner in other areas of HCM (e.g., workforce management, global payroll), where it makes sense."

Add it up and NetSuite appears to be pitching a two-tier HCM model that matches its ERP go-to-market strategy. Look for NetSuite to package TribeHR for subsidiaries and global operations and then connect them to the likes of Oracle and SAP at large company headquarters.

TribeHR's starter plan starts at $5 per employee per month with a group option for $10 per employee per month. A full TribeHR suite will run $15 per employee per month. TribeHR also has enterprise volume pricing.

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