Gusto, an HR tech company valued at nearly $10 billion, has agreed to acquire Guideline, a startup that provides retirement plans to small and medium-sized businesses, CNBC reported on Wednesday.

Financial terms of the deal were not disclosed. The transaction comes amid an uptick in startups buying their venture-backed peers in 2025.

Interestingly, the two companies have been partners since 2016, when Gusto tapped Guideline to provide retirement plans to its customers. In January, that partnership deepened with Guideline announcing that it was integrating with Gusto Embedded Payroll, marking Guideline’s “first and most established payroll integration.”

Founded in 2015 by Kevin Busque and Jeremy Caballero, Guideline has raised nearly $340 million in funding, per Crunchbase data. Investors include Gaingels, General Atlantic, BoxGroup, 500 Global and New Enterprise Associates, among others. Its last funding round was a $200 million Series E led by General Atlantic that valued the company at over $1.1 billion.

Gusto, founded in 2011, has raised over $746 million in funding, according to Crunchbase data. Backers include Pear VC, General Catalyst, Emergence Capital, Y Combinator and Kleiner Perkins, among others.

Both companies’ target customers are small businesses.

According to CNBC, Gusto had more than $500 million in annualized revenue as of 2023, and Guideline’s annualized revenue as of January totaled $140 million.

It’s not the first time a smaller player in the retirement space has attracted the attention of a larger company. In January 2023, investment giant BlackRock took a minority stake in venture-backed SMB 401(k) provider Human Interest.

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Illustration: Dom Guzman