Transcript
Mark:
Today an encore presentation. I’m talking with Steve Rothberg, the founder and chief visionary officer of CollegeRecruiter.com. They help employers of all stripes hire students and recent graduates for part-time, seasonal, entry-level jobs and internships. We’ll talk about how recruiting’s changed in recent years, and we’ll also look at some dynamics of the workforce, on this edition of PeopleTech.
Hi, Steve. Welcome. Let’s start with as a foundation, tell me about College Recruiter. What does it do? Who does it do it for?
Steven:
Yeah. So at a very high-level, College Recruiter believes that every student and recent graduate deserves a great career. Our customers are primarily Fortune 1000 companies, government agencies, and other employers who are hiring at scale. And when we talk about scale, we’re talking about dozens or even hundreds into the same or similar rules. They advertise with us. They’re part-time, seasonal, internship and entry-level jobs. So we’re a job search site. Think a site like Indeed, but specifically for the student and recent graduate niche.
Mark:
And you changed your business model. First, can you tell me when you did it, but also what’d you do?
Steven:
Yeah. So back in 2016, which it’s hard to get this through my mind, but that’s six years ago now, we started to have a very small number, but rapidly growing number of our customers or employer customers who basically were saying things to us like, “Hey, we’re buying this unlimited job posting package from you on an annual basis. And it’s $12,500. We’re happy with the candidates that we’re getting from College Recruiter, but we just wish we would get more of them. Can we pay you more money,” literally, a couple of them said, “If in return you can give us 3, 4, 5 times the number of candidates?”
Years before I had been to a presentation by a guy named Guy Kawasaki and Guy was the Apple evangelist. I think it was literally his job title. And in his presentation he was talking about one of the investments that he had made in some startup company, that the way he described it, the founders refused to sell their product to customers who would not… Unless those customers agreed to use the product how it was intended to be used. So if you’ve got a screw driver, you cannot use that for anything other than screwing things in. And he had it out with them after a while. It’s like, “If a customer is looking to give you money, you as a business owner should try to find a way of making that easy.”
So in 2016 when we started to have some of these customers saying, “Can you send 3, 4, 5 times as many candidates to us and we’re willing to pay more for that,” we needed to figure out a way of making that happen. And what we did is we looked around at other organizations in our industry and some outside of our industry who were doing that already. And one of them was Indeed and there were some other pay per click job search sites. So basically what they had figured out was that if they charged their customers, the employers on a duration basis, a traditional duration basis, X dollars for Y postings or Y dollars for Z months, that the more candidates that they delivered to those employers, the smaller the profit margin was for the job board because the job board had costs to generate that additional traffic.
And by shifting it to a pay per click model, what the job board was able to do was to scale that up. If you pay us $1,000, we can deliver 10 times the amount of traffic to you as if you pay us $100. If you pay us $10,000, we can 10X it again. So just by paying more, they could deliver more traffic. And that’s what we did. So we created a product back in 2016 called Jobs That Scale, and it is a pay per click job posting product where over the years it’s evolved into being a subscription-based product where the vast majority of our customers, they sign up and it runs month after month after month until they tell us to stop. About 95%, 96% renew month after month after month after month.
So it’s driven really great growth for us, and it much better aligns our interests with those of the customer. Because if we perform, we get paid well, if we don’t perform, we don’t get paid. And so it’s really in our interest not just to run the ad on that post and pre-model that most people hate, unless you’re the job board getting paid. But if the employer succeeds, we succeed. And if we don’t deliver good value to the employer, then we’re penalized for that. And I think that’s how it should be.
Mark:
Well, that leads to the question of is it that way in a lot of other places or in other places at all? I mean, how unique is this among job boards?
Steven:
It is not unique with the big general sites. Just about any big general site that you can think of is at least in part selling on a pay per click basis. So you think of the ZipRecruiters, the Indeeds, the Monsters, LinkedIn, a fair number of their employer, customers, and sometimes completely are paying on a pay per click basis. What was we think at the time in 2016 unique was for us as a niche job board to have migrated our customers from the traditional duration-based model to a performance-based model. We think we were the first niche job board in the world to have done that. There were other niche job boards that were selling on a pay per click basis, but as far as we could see, they always had been.
It’s one thing to start off that way, you only have customers that are oriented to buying that way, but when you have customers that are used to buying on a traditional duration basis, and you have to educate them about why it’s better to buy on a pay per click basis, that has a whole lot of challenges. What was also really interesting to us quite surprising was how different the skillset of our employees needed to be. Critical thinking skills and ability to really see math, to see numbers and to see at a glance, is this profitable? Is this not profitable? Is there a problem with this campaign? Is this campaign succeeding? And just to see those added glance, that was a whole different skillset that we found we needed. And the people that we have now have that.
Mark:
So you started this in 2016 and it was last year, 2021 that you expanded it internationally, am I right?
Steven:
Yeah.
Mark:
Yeah. So what did that involve?
Steven:
Yeah. Well, remember, a couple minutes ago I was saying that in 2016 we had a really small number of customers that were saying, “Hey, you’re helping us with these all-you-can-eat packages. If we paid you more money, could you also help us by driving more candidates or could you help us in this way?” The same thing started to happen a couple years ago. We had, again, a small number of customers that completely unrelated to us were centralizing their recruitment marketing budgets. Recruitment marketing in most organizations used to be highly decentralized. You’d have a very small budget at the headquarters level. And if you were a big box retailer, each store manager would have his own budget and he might run ads in a newspaper or put up flyers outside the store or whatever. And recruitment advertising was highly local.
What started to happen not many years ago was you started to have more and more employment branding people hired into these large organizations and you started to have the more of the programmatic vendors really emerging and gaining popularity. So the Joveos, the PandoLogics, Perengo, which became Radancy’s product, Appcast, et cetera, really started to emerge. And that I think fueled the growth where more and more of that recruitment advertising span moved from the store level to the headquarters and even to the global headquarters. So suddenly a couple years ago, some of our customers that we had been working with for years whose budgets were at best national, and often regional started to say, “Hey, my area now controls the recruitment advertising spend globally. You’re helping us in the US, can you also help us in Canada? Can you also help us in the UK?”
And again, thanks to Guy Kawasaki, my attitude was if a customer’s asking if you can help them give you money, you want to find a way of saying yes to that. So we started to accept postings for jobs that were located outside the US, and we made some bad mistakes. One bad mistake we made was thinking that we could do all of that in US dollars. And that proved absolutely not to be the case. What we’re migrating to very quickly is if you’re running postings with us in the United Kingdom, you are paying us in British pound sterling. If you are running postings with us in Canada, you’re paying us in Canadian dollars. If you’re running postings with us in Australia, you’re paying us in Australian dollars. And the reason for that is that still those organizations if they are spending money with you in Australia, they tend to want the budgets to be coming out of Australia. So if they’re not in Australian dollars, it adds some risk and it adds a lot of complexity on our end, but it’s really helping us scale.
Mark:
I’ve got one more question for you, which actually is more of a market question if you don’t mind. And you obviously are focused on college recruiting and what college students are up to. Given the pandemic and just the general craziness of the last two, two and a half years, have you seen changes not only in the way companies are recruiting, but how college students are behaving and reacting?
Steven:
Absolutely. Two and a half years ago the idea of working remotely in just about any kind of, let’s call it white collar job, professional job, office kind of job was almost unthinkable for most people. And now it’s pretty much expected, that it’s at least going to be hybrid. It might be fully remote. At College Recruiter we’ve been fully remote since 1997. We were fully remote the years before we wanted customers to know it. We pretended we weren’t because the attitude back then was… It’s like, “Oh, well, if you work at home, you aren’t really working.” And now almost everybody understands that’s far from the truth. In fact, most people are a lot more productive at home than they are in an office environment. What’s happened in the college space, sort of that the Gen Z is the typical student in recent grad is really no different from those who are in their 30s, 40s, 50s. That there are certain people who are much happier working remotely.
There are certain people who want to have a hybrid environment. There are certain people who want to be in office. And I think employers that are trying to put everybody into one of those boxes are going to fail, and I think they need to understand that they need to accommodate different kinds of workers in different kinds of situations. And that some weeks you might come into the office and some weeks you might not. There is I think a bit of a difference of people who are of our generation, let’s call it Gen Xers and up, Xers, boomers, et cetera. I think more of us are comfortable and want to work from home. And part of that is that most of us have a lot of experience. We don’t need a lot of supervision and we’re also… Most of us are past the point where we feel the need to work in an office for social purposes.
We already have spouses, friends, family members, or whatever that we hang out with. But if you are a 22-year-old and you just graduated and moved halfway across the country, and you’re living in a city where you don’t have any family or friends, your workplace is where you’re probably going to make your friends and perhaps meet your spouse. And when all those people are working at home, that makes it that much harder. I’ve been watching the WeCrashed series on… I think it’s on Hulu about the WeWork company that create… Well, it didn’t create, but they popularized coworking environments. I think we’re going to see a lot more of that where people can choose to go into an office even if it’s for a day or two a week. And they might be there with their coworkers, or they might be there with people who are working for other organizations, but we are social creatures. We do want human contact. And I think that companies need to facilitate that, but not require that.
Mark:
Steve, thanks very much for your time today.
Steven:
Awesome. It’s been a pleasure, Mark.
Mark:
My guest today has been Steven Rothberg, the founder and chief visionary officer of College Recruiter. And this has been People Tech, the podcast of the HCM Technology Report. We’re a publication of RecruitingDaily. We’re also a part of Evergreen podcasts. To see all of their programs, visit www.evergreenpodcasts.com. And to keep up with HR technology, visit the HCM Technology Report every day. We’re the most trusted source of news in the HR tech industry. Find us at www.hcmtechnologyreport.com. I’m Mark Feffer.
Image: Northwestern University
