Careerbuilder Says Sell! Sell! Sell!
The mergers and acquisitions market is heating up this week starting with Careerbuilder's first foray of sales under Apollo with the selling of EMSI.
Oh yes there's more:
- Adecco acquisition positions then to grow talent
- PeopleFluent gets a pathetic pricetag
- Google for Jobs gets busy in India
- Google for Jobs will penalize your ass!
- Work180 velvet ropes their female community - ONLY qualified employers allowed
- Buy stocks in Sex Robots and VR now!
Enjoy, and visit our sponsors: Sovren, America's Job Exchange and JobAdX.
Announcer: Hide your kids. Lock the doors. You're listening to HR's most dangerous podcast. Chad Sowash and Joel Cheesman are here to punch the recruiting industry right where it hurts. Complete with breaking news, brash opinion, and loads of snark. Buckle up boys and girls. It's time for the Chad and Cheese podcast.
Joel: Hi-de-ho boys and girls. Welcome to the Chad Cheese podcast. HR's most dangerous. I'm Joel Cheesman.
Chad: And I'm Chad Sowash.
Joel: On this week's show, TMP gets gobbled up by a private equity firm.
Chad: Another one?
Joel: We know how this one turns out, don't we? CareerBuilder dumps MC and if you thought job boards were worthless, wait till you hear what someone paid for old-timey ATS PeopleFluent. It's the mergers and acquisitions episode. Stay tuned.
#ElChapo: Lastly... Yes. There will be a trip [crosstalk 00:01:02]
Joel: Oops. Wait.
#ElChapo: I just don't know when and-
Joel: That's not the ad.
Chad: That's the El Chapo ad, dude.
Joel: The El Chapo visit Mexico ad that we have. No. Sorry. Let's play the real ad for our listeners.
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Joel: If people think we have fun. Our sponsors have a lot of fun. Case in point. The JobAdX crew from Vegas, showing up with beer for an interview and peeps, by the way. A little Gordon Ramsay dinner. So, shout out, I guess, first, to those guys. Isabelle, Tim, the whole gang. Had a great time with them at SHRM Talent.
Chad: Don't forget Amit because we have a podcast with him, so if you haven't heard that one, you don't know about JobAdX or even Talroo, used to be Jobs2Careers. Check out our last podcast.
Joel: It's a one-two punch of knowledge and insight into two really interesting companies in our space, for sure.
Joel: We're not just saying that because they pay us.
Chad: No. Why the hell would we do that?
Joel: It doesn't hurt, either.
Chad: Other than bringing us beer, maybe.
Joel: The beer is probably more valuable than anything else. But, anyway. Shout outs. We've had feedback that they're too long, so we're gonna try to tighten them up. I don't know if I can reel Chad in.
Chad: Good luck.
Joel: But, let's get to an abbreviated, hopefully, shout out.
Chad: You first.
Joel: Okay. Number one, Jack Russell.
Chad: The dog?
Joel: It's not a dog, I swear. Jack Russell is a former CareerBuilder intern, who was very insightful and a story that I did for ERE he's not real keen on the deal, for whatever reason, you'll have to read the story to find out exactly. Jack is ... let me get his ... he's the strategic recruitment analyst at Advanced Group in Chicago. Thanks for listening, Jack, and thanks for having such a cool name like a dog name. Your parents much love you.
Chad: Yeah. So much.
Joel: Mac Pritchard, who we met at TATech in Vegas, a job board owner in Portland. His site is called, “Macslist”, which is very Craigslistyish and Angie's Listyish, but Mack is a really nice guy and, hopefully, a new listener. Mack, a shout out to you. Lastly, from me, Blair Cheeseman, from Fusion Academy for no other reason, than he has the best last name in the world and he attended this week's Ratedly webinar. Blaire, thanks for joining and thanks for listening.
Chad: Since you were the only one on the webinar, Blaire. We appreciate that.
Joel: Now, see, that's bullshit. That's bullshit.
Chad: Can I go now?
Joel: Yes. You may.
Chad: Okay. LinkedIn loves us. Sara from LinkedIn. Tom, I'm gonna screw your last name up, Preziose. He's out there pimping the pod to his friends on LinkedIn, which is awesome. Ed from Philly, who's hating on TATech audience. Good job, Ed, we love you for that, man. Nancy from Philly tweeted us a pic.
Joel: From vacation.
Chad: From vacation.
Joel: What's with the vacation pics? We're getting pictures from the beach, from airplanes, first class cabins, like, what is the deal?
Chad: It's good. Angela Payne from Monster, for the Google for
Jobs intel coming to Canada soon. Last, but not least, Ed Newman from Phenom People for his HR's most interesting man video. Dude, seriously. Just because we've coined the phrase, “HR's most dangerous podcast” doesn't mean that you can just go ahead and take “interesting”.
Joel: Yeah, I assume, go to YouTube, search Ed Phenom People, interesting video and it's a funny take on, obviously, the Dos Equis commercials. And these sort of gorilla ads are interesting.
Joel: You remember [Lena's 00:06:12] from ...
Joel: From Lever, Lever, whatever it is? She had a nice Christmas video that blew up, so we're seeing a little more of these gorilla-type homemade, raw videos and I assume we'll see more of these. Maybe we should make one.
Chad: Yeah, don't get crazy.
Joel: Yeah, sorry.
Chad: Let's talk a little bit about the trip, though, man. We were in Vegas for a whole damn week.
Joel: Yeah, my liver still hates me.
Chad: I've gotta say, I've gotta say, Tony Lee, always thought he was cool, but he is much cooler than I ever thought. What do you think?
Joel: Big Cheap Trick fan. Yeah. Tony's like ... he's a child of the '70s, I assume, in terms of, he came of age in the '70s, so he has some really cool rock stories, concert stories. If you ever can corner Tony over a drink, ask him about his concerts portfolio.
Chad: We've got an interview with him that should be coming out in the next week or so, so check that out when you see Tony Lee. Guy's been around this industry for a very long time and he's got chops. Thanks to Susan Vitale for the drive-by hugging. It feels like, she's off all over the place, but appreciate the quick hug, as in, you were on your way out.
Joel: Yeah. She's a popper-inner. She pops into shows and then leaves.
Chad: Great interview with Sackett on Indeed “jail” and the two CEOs that we've got going on right now. We did find out that our listeners are pretty damned cool.
Joel: Yeah, we continue to be humbled by our fans and that people actually listen to this crap. So, yeah, it's awesome. Totally awesome. If you haven't heard the Sackett interview, it's really, really good. It's only about 14 minutes, but very insightful.
Chad: And Erik Kostelnik, he was at ... He actually gave the keynotes at TATech. Erik, you straight stole our shit, dude. You've been listening to the podcast and that was a Power Point version of our show. Congrats. It was great, but you stole our shit, man.
Joel: Apparently, he rattled of a whole bunch of companies that stole his shit, so there's a whole lot of stealing going on in this ecosystem, if nobody knew that happened, it does. But, yes, Erik, love is candor, love is openness, he was great as the keynote and we're interested to see what's next for him, as he cashes on iCims, excuse me.
Chad: Last, but not least, to Armando from HireMatch, dude, this is advice, man. If you need to-
Joel: are you throwing ... Are you gonna do this?
Chad: Yeah. I'm gonna do this. Dude-
Joel: This poor guy.
Chad: He's gotta hear it.
Chad: He's gotta hear it. Dude. If you need to read from a script, while presenting and, legit, can't run a Power Point, I don't trust your blockchain knowledge, man. I don't trust your blockchain knowledge if you can't do those very simple things. So, get your shit together, dude.
Joel: Yeah, don't give a Power Point where it still says, “Click here to add text” on the Power Point.
Chad: There's a tweet out there.
Joel: I did it. I did it. I drew first blood on the poor guy. Yeah. Don't do that. Otherwise, #chadcheese for more shout outs and more love. Check out our tip line at chadcheese.com. We've been really surprised at how many people are coming out of the woodwork with stories about vendors and lay-offs and mergers and acquisitions and whatnot. If you got a tip for us, go to Chad Cheese and hit us up.
Chad: Cool, let's do the show.
Joel: Alright, following the private equity playbook to a T, CareerBuilder looks like it's starting to sell off it's crappy businesses that aren't making money, starting with Emsi, I'm saying that wrong, probably, MC Hammer, they sold this week. Yeah, I don't know much about Emsi, they do analytics.
Joel: They do predictive stuff. They were bought by a company called, “Strada” who does education stuff. That's about the extent that I know about this stuff. You had, actually, some insight from an insider, though, didn't you?
Chad: Yeah. I mean, Emsi, so it's E-M-S-I, and it's labor market information, it's got jobs data, profile data, and they pump a lot of that information into talent discovery for CareerBuilder. In a message to CareerBuilder employees from Matt Ferguson, we actually got a copy.
Chad: Yeah, it was pretty much just trying to tell everybody at CareerBuilder, “Yeah, we're selling Emsi off, but it's same as it ever was, same as it ever was,” although, I'm not sure that it's going to be the case. The messaging says, “All connections will stay the same. We will still keep CareerBuilder, we'll still keep selling Emsi products,” and Andrew Crapuchettes that's one of the worst last names I've ever ... Crapuchettes.
Joel: That's worse than Cheesman, geez.
Chad: At Emsi, is still happy to hear that. Although, you go further into the message, and the email actually unveil that the Emsi representation of CareerBuilder revenues is less than 1%, so you understand why they're getting rid of this. They're looking at the bottom line saying, “You know, this isn't doing anything for us.” But, there are really two things that CareerBuilder, I don't think gets, and I don't think Mr. Crapuchettes gets, is that CareerBuilder wasn't selling that product anyway. If you're going to hope and pray that CareerBuilder sells it now, that it's not actually owned by CareerBuilder, you're gonna have a problem, dude. Less than 1%, if you believe that's going to grow, you're wrong.
Chad: Number two, CareerBuilder didn't know how to sell it. The data, all that information ... One of the biggest issues, and we've talked about this last few months, but CareerBuilder's biggest problem is, using what they have in their portfolio to create kick-ass products. They're not doing that. Developing concise branding and messaging and, most importantly, how to monetize those kick-ass products.
Joel: Yeah, and for all we know, this thing was bleeding the company, in terms of, resources and headcount and everything else. I'll go back to Apollo Global Private Equity firm that is majority shareholder of the company, this is part of their maximizing profits initiative and this is what private equity does. We'll talk about it more in depth with TMP a little bit. Look. We know that they're laying off people, we know that people are leaving from executives on down, engineers, salespeople, probably glad that people are leaving to a certain extent because they can just increase the bottom line. This is the second phase, and they've probably been working on this just as much as they have headcount.
Joel: Is, what businesses can we dump to increase profits? Emsi, in my opinion, is the first of many companies that are gonna be dropped by CareerBuilder in the coming year.
Chad: Yeah. Or just tech that they're going to really just eject. After talking to more salespeople at CareerBuilder, more engineers at CareerBuilder, the big focus that they've really heard, is EBITA, EBITA, EBITA. CareerBuilder was slammed into a tight EBITA culture and they are not an EBITA company.
Joel: Not historically.
Chad: Not like Randstad and I think they're sliding Monster into that direction, but they're not slamming into that direction. It's all about margins. If you understand EBITA and you understand overhead, they're cutting a bunch of hubs.
Joel: Yeah. You said something that is really telling in that salespeople, typically, are really good about focusing on a few products or one product that they can really understand and if you have a salesperson that's used to selling job postings and now they have to sell analytics predictive whatever, that's a really tough leap for a lot of people, let alone, salespeople to make. My guess is, this product probably wasn't being sold, like you said.
Joel: So, let's get rid of it. It's an expense. We're not getting it anyway. The revenue isn't there anyway. So, get it out of here. My question would be, what of CareerBuilder's portfolio, would you categorize as a challenging sell to get, to understand?
Right? That's so far out of bounds for job postings that it's probably gonna be next on the chopping block.
Chad: Well, here's the thing. I'm gonna take it the other way. From what I've heard, CareerBuilder's focusing heavily on the job posting piece because the margins are so high.
Chad: And all their solution architects. So, when you start talking about building these dynamic solutions, you see this in RPO, they have what you call, “solution design” or “solution architects.” That's where the big dollars come from. Actually sales come from is when you can pull together those different types of technologies. Well, all those people are actually gone and they pushed them back into sales roles. That's the focus of, again, trying to maximize where they see their biggest margin. To answer your question, anything that is not core, that has high margin, has a lot of EBITA ability there, they're all low hanging fruit, dude.
Joel: Agree. Let's talk about TMP, the most recent victim, well, I shouldn't say victim, maybe I should say victim, of being gobbled up by private equity firm, in this case, one called, "GemSpring", which I have never heard of.
Joel: Thoughts on this?
Chad: See, CareerBuilder, they have a ton of technical assets in their portfolio. They have all these different products, they have these different companies, that they earning that they can sell. So, from an asset standpoint, CareerBuilder, I can see where you can look at it and say, “Oh, there's money to be made there. If you squeeze tight enough and you start selling shit off.” From a TMP standpoint, the only ... They have technical assets, but they're around TalentBrew, in most cases, and I think they've really pushed hard to create a platform that has also created bias for them because they're supposed to be an unbiased purveyor of knowledge and spending money. I'm not really sure that they can keep up with all the start ups that are happening out there as it is.
Chad: So, I think it's gonna be harder for a TMP in this scenario, unless they really start to boost the hell out of products or boost the hell out of sales through what they normally do from a traditional standpoint. That's just selling a shit ton of ads, using everything that's out there. Instead of trying to build up a TalentBrew, which is a competitor to most of these people in the market.
Joel: Yup. You know, historically, people that are new to the industry, don't appreciate the fall that has occurred with the agency business. The days of when agencies could just answer the phone and put display ads in Sunday newspapers, life was really good. Getting 15% of a $5-10,000 display ad and doing that a lot was very profitable. The job board industry created commoditization, so the 5,000 display ad is now a $99 ad on HotJobs. Then, there was a phase of like, “Well, let's create our own technology and try to get a hundred percent of the profit. Try it. So, let's make a jobs to career, a jobs2web-”
Joel: “Competitor.” You saw that on the direct employers end and create all these social, like, “Have a page on Facebook” they offered that for a while. That really hasn't worked out. They're a skeleton of what they used to be. I commented at the SHRM talent show. All the SHRM shows used to be half of agencies.
Joel: Tons of agencies. Now there's two. There's a small number of agencies. I agree with you, they are consultant. I think there's a need for them, particularly with all the AI, automation, Chatbot, deep big data stuff that's out there. There's a need for companies to say, “We don't really know what the hell we're supposed to do or buy or use. Help us do that.” But, that's less some of the advertising situation because you have the programmatic end coming in, which is gonna be a thing, right?
Chad: Yes. Yes.
Joel: So now, it's like, “Who's the best programmatic?” This becomes a really challenging industry, although, they make a lot of money, TMP has some really good clients, the private equity firm is probably gonna replicate what we saw at CareerBuilder, what we're seeing at Monster. It gives an opportunity to the boutique agency. I think you and I both, in Vegas, heard stories about people dumping the bigger type TMP agencies for the smaller, more personable ones. I think that's gonna continue. I think a lot of companies that use TMP are gonna look at this acquisition and see people leave or see people see things go away that they're used to and look for alternatives.
Joel: We'll see what happens, but I don't think this is probably a great thing for the future of TMP. I don't see them hiring people and growing this thing out, but I guess we'll see.
Chad: It'll be interesting to see the direction, as I had said, with the technology. Are they going to try to continue to compete in the realm of technology? I don't know. That's hard. Then, also, like, you'd said, on the programmatic side of the house, everybody's doing the ad buying piece, so there are so many different, as you said, boutique types of agencies that are really specialized, competition is high. Very high. In all flanks for them.
Joel: Yeah. And what did we hear at the conference from the programmatic guys? That's ultimately a commodity, too.
Joel: I just don't know where a lot this stuff goes. In private equity, it's not in their DNA to say, “Let's build out products.”
Joel: “Let's enhance, let's evolve, let's throw stuff at the wall.” Like you said, maximize profits, sell stuff, sell it off to whomever, and that tends to be the history of what happens with these guys. If you're at TMP and stuff goes on, hit us up at chadcheese.com and let us know what's going on.
Chad: Where's the bell?
Joel: You want the bell? You like the bell.
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Joel: Google, we gotta talk about Google every week. We need a theme song.
Chad: A Google theme song, yeah. You'll be definitely be hearing it in India, right?
Joel: Google for Jobs is coming to a neighborhood near you and all around the world.
Chad: Yeah, yeah. There's really not going to be an area that Google for Jobs is not going to try to penetrate. Europe, Canada supposed to be coming, supposedly.
Joel: Yeah. We both heard, the country up north is getting Google for Jobs.
Chad: Yeah. Yeah. It's coming. The big question is, how do you work with it? How do you leverage springboard off of it? That's the big question. As we've actually talked to job board owners and job site owners and whatnot over the last month and, especially, last week at SHRM and TATech, the question is, where do you pivot? Where do you go? You have to find something different than just being a damn job board, unless you're super niche and you've got a community that people really need. Unless that, you're gonna be struggling. You're gonna be struggling.
Joel: Yup. We, again, going back to Vegas, it's great to get out and see presentations and different points of view and updates, but one of the things that really struck me, was someone said, someone presented and said, “What is the scariest page on the internet?” Of course, I said, “You're LinkedIn profile,” but that was the wrong answer. The right answer, according to this presenter, was, Google for Jobs, search results page.
Joel: One of the things that I thought was interesting was, Google has stopped putting the ATS URL as a apply option and their putting in the company name as the option, which, I think, is part of the taxonomy, or whatever, when you submit jobs to the site. But, to me, I think we've talked about this before, is that, look, if you're a job seeker, and you see, okay, here are the ways you can apply to this job, either the company or CareerBuilder or ZipRecruiter or Monster or whatever. You, as a job seeker, which one are you going to pick. Even though the others might be easier, you're probably gonna think that your best chance to get into the company is by using the company website. Agreed?
Chad: Yeah. I would agree just from what I know over the last decade, or so, but I think that's changing because some of these services are offering a better experience. That's what Google's looking for and that's really what, I think, Google is trying to find out. Is ZipRecruiter a better experience than the actually corporate website? Is that site? Is this site?
Chad: I think that's something that we're gonna figure out. This is really the key. When I talked about these different job boards or these different job sites, or whatever, recruitment companies, trying to leverage Google for jobs. This is what I'm talking about. If you have a better experience for that customer coming through to the job, you're gonna win. That's the beautiful thing, or you're not, so you better focus on being great.
Joel: Yeah, we've talked about it is you gotta Amazon that shit.
Joel: It's gotta be one click, good to go, done, and effective. I think what someone asked in the presentation was, “How does Google decide which job boards show up on Google for Jobs?” Certainly, there's some relationship things there, at least initially, but over time, Google's gonna know which sites people click on and come back to Google and click something else, because they do this with their search results. In their search results, if you click on a result and then you're back on Google within five seconds, they know that the result that they gave you sucks. So, eventually, that page, in this case, is going to start slowly going down the search results page or rankings and, eventually, not show up.
Joel: I agree with you, if Job Board X is horrible and people click on it and go, "This sucks" and goes back to Google and clicks on something else, that initial site is going to disappear in my best guess, over time. You need to work on your apply stuff and make as Amazon as possible.
Chad: Right. Again, it's about experience. Google cares about the user. That's the person searching for the job. Your content really doesn't matter to them because it's shit. Guess what? It's gonna be kicked to the curb.
Joel: Also, it's a red flag, or wake-up call, for ATSs to make applying really easy on their site because if you can make your apply really easy, so the point where, I, as an employer, don't have to put my job on all these job boards that also show up? Then, guess what? I'm gonna save a ton of money, if I'm not using half or a percentage of the job boards that I'm not using or I'm using today, because my ATS got it right with the apply process.
Chad: Yeah. I think a handful of ATSs really give a shit about the user experience. Just a handful. The rest of them, they don't give a shit. You can go out and you can go buy a cosmetic apply partner to be able to do that.
Joel: I agree.
Joel: Adecco and PeopleFluent. We got more mergers and acquisitions.
Chad: Oh, man. Adecco. I think Adecco, out of the two is much more interesting. Just from the standpoint of, we're talking about a people company, a staffing company, it's their job, it's their money to be able to get the right people into right jobs. Then, you've got General Assembly, which they're more of a credentialing, skilling up type of organization, so if I needed in-demand skills, whether it's coding or something like that, I could actually take courses through General Assembly. This makes sense. Obviously, from the standpoint of, Adecco being able to go out after these different clients and say, “Guess what guys, whether it's just staffing, RPO, whatever it is, we can actually, not just go out and find the types of candidates that you're looking for, we can take what you need.”
Joel: "We're gonna grow them."
Chad: “We can grow them.” This is what an actual fucking talent pipeline looks like, guys. You don't just go out and steal and find, you grow that shit, too. This, from my standpoint, for $412 million is genius for Adecco, if they pull this off right.
Joel: Yeah. Yeah. I think we feel about this acquisition sort of like how we felt about IKEA buying TaskRabbit. It was such a normal and natural and organic marriage.
Chad: It made sense.
Joel: This is the same thing. We place people, let's grow the people ourselves, let's get them right off the tree, and then place them. That makes a ton of sense. This isn't a private equity deal, where there's no synergy, really, at all. It's not just, “Hey, let's just maximize profits, cut out fat, and then sell this thing off.”
Joel: This a real acquisition and kind of marriage that we like to see happen, so kudos to Adecco for seeing that and making that happen.
Chad: Well, here's the thing, and I say this all the time, If you want to look at what is more efficient and smart, look at staffing companies, look at RPO, definitely look at RPO because they are focused on the EBITA on efficiencies, and that's where dollars come from, from efficiencies. If they have a competitive advantage in the market, they're going to squeeze the hell out of it. Companies can do the same damn thing without acquiring another company. They just have to be smarter about it. But, unfortunately, they're not, so you might as well go ahead and just plug into Adecco. Seriously. Bullshit. How stupid. The people are out there. You can skill them up. Go do it. “No, we're just gonna go ahead a pay really high fucking fees.” Okay. Have fun with that.
Joel: Fun with that. Our insight into the other acquisition of PeopleFluent is a little less optimistic, but we're both really shocked by the price tag.
Chad: $150 million and this is an applicant tracking system. It's gone through a rebranding, but it's been around for well over 10 years, 15 years, maybe 20 years.
Joel: Yeah. It's old.
Chad: It's (PeopleFluent) technology. It has assets already. It's huge on the compliant side of the house. I know that, which is always something that federal contractors, who have huge dollars, need. So, they've got that from an asset standpoint. Then you take a look at the sales side, which I have no clue what their sales is, but with this low-ass ticket number, what do they have, like two or three clients for goodness sakes? This is pitiful.
Joel: Let's put this in context, a little bit. Okay. LinkedIn sells for Microsoft for $26 billion.