You've just been acquired after being in business for a few short years.
What are ya' going to do now?
Go on The Chad & Cheese Podcast, of course! Or at least that's what Canvas' CEO and founder Aman Brar decided to do recently. In addition to discussing the Jobvite acquisition, Brar delves into a variety of topic, especially about how starting a recruiting technology wasn't the smartest thing ever.
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Announcer: Hide your kids, lock the doors, you're listing 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: Alls I knows you win death match, next thing you know you get acquired. I mean, it's yeah, yeah. Are we rolling?
Joel: All right, cool. What's up guys? This is Joel Cheesman of the Chad and Cheese Podcast, here with Chad. Welcome to the post St. Patrick's Day edition of the Chad and Cheese Podcast. We are ironically in an English pub having beers, hair of the dog if you will. But we have a great guest today here in Indianapolis, Aman Brar from Canvas. Aman, welcome to the show.
Aman: What's up? Really glad to be here and excited to be hanging at Chatham.
Joel: You look excited. So, for those who don't know, one of our first face-to-face interviews was with your company. You were the winner of our first ever death match.
Aman: It's true.
Joel: And yeah, I think a thank you is maybe in store from you at this point.
Aman: You guys got the equity agreements right, before we got acquired, did you guys get those?
Joel: Yeah we're still waiting on that check, but that's okay.
Aman: Oh okay man. I thought it was in the mail.
Joel: By the way, full disclosure, you are a sponsor of the show.
Joel: Which I guess is a little bone here or there is nice. He does get the hometown discount, but that's neither here nor there.
Aman: It's true.
Joel: I'll start with the first question. Jobvite acquisition, how did you and
Dan Finnigan, the CEO get together? How did this whole deal go down?
Aman: The narrative, we had a lot of interest in the channel. The last company that me and many of the Canvas team members had scaled, we're very channel focused. So we worked well with the ecosystem, we drove deals and drove integration so we ran that same playbook which is a necessary playbook in the HR tech space.
Joel: Oh yeah.
Aman: So when we were putting the pieces for Canvas together, laying the groundwork, obviously we had a targeted list of partners that we wanted to work with, Jobvite was one of those. So we've been working on cultivating a relationship there which then led to basically them being our first official reseller. So versus just a market place partner, or a referral partner. They launched had product called Jobvite Text powered by Canvas and the negotiating of that agreement, and then the really exciting execution of that. So look, if that wasn't successful we're probably not part of the sports team today.
Aman: But it was very successful. The product really took off and made a lot of sense for us to continue. So it was really just through ... Like in most cases I always tell folks I'm talking to, likely you're already doing business with your future acquirer and I think that largely played out in this case as well.
Chad: Yeah, so big high five by the way.
Aman: Yeah thanks man, appreciate it. It's fun.
Chad: Awesome. We love hearing and seeing Indie business just fucking kick ass.
Chad: So you said Jobvite Text.
Chad: Right? And that's the product. So we talked about this a little over a year ago. If you remember, we were kind of drunk, I think. But are you looking to prospectively change names and roll up under Jobvite and become Jobvite Text?
Aman: Well I like my t-shirt a lot with Canvas.
Joel: I like them too.
Aman: No, in all seriousness it's a complex roll up. So you've got four brands, four companies. I think right now, and I think largely even for their conceivable future, these independent brands make sense and mean different things to different parts of the market. One of the advantages that we have with Canvas brand, or RolePoint might have, or Talemetry might have is we can go through our sales processes without complicating or hitting the trip wires of, "Oh my gosh are we changing our ATS?"
Aman: And so I think there's some advantage to just continuing to be who we are, represent what we represent in the market place, knowing that there's certainly going to be those very consultant like synergies that will come into play. But at the end of the day, it's been of great benefit, I think to us, to Text Group, to AllyO, to you name it, to not have to get in the middle of an ATS switch over conversation as part of the sales process. And I think why anybody would want to jump into that really quickly, I don't know, you'd be confusing to me. So I think there's some advantages to continuing to operate how we've been.
Chad: Yeah, I mean having a separate product, brand, being able to go after anybody with any applicant tracking system is awesome. Just looking at long term, from a Jobvite standpoint, being able to say, "Look, we have this, you don't." Whatever that applicant tracking system is, it seems like a huge market differentiator. And to be able to bring Canvas into that ... From our standpoint we've talked about this before, it's like you want to use that hammer. How long do you think it's going to take for Jobvite to actually bring Canvas in and say, "Okay this is our hammer?"
Aman: I would argue these don't have to be separate things, actually. The second you can run a new playbook that's no longer having the leverage, just your publicly available APIs, you could drive a lot of strategic advantage through an integrated experience, but still go do a lot for the ecosystem. And I think you're also seeing other companies continue down that playbook, so I think the onus on Jobvite, Talemetry, RolePoint, Canvas is to go create a highly differentiated unique experience that delivers a lot to the enterprise.
Aman: But it doesn't mean that we need to trade off everything that we're doing today across the ecosystem. And this is largely in the press release. At the end of the day, these roll ups happen largely to go attack the enterprise space, not to go track the SMB space. So again, you might be driving a lot of value and a lot of focus and a lot of sales place to go win that Fortune 500, Fortune 1000 market, but there's still a really big mid market out there where we don't need to be everything to everybody in that mid market, and so I think we're going to continue to see that.
Joel: So for the foreseeable future Text recruit will be able to integrate with Jobvite, you'll be integrating with iCIMS, there won't be any sort of friction there.
Aman: We've added additional partners conversations since the acquisition, so our integration playbook's still running, we've got two additional integrations that are in process right now. We've done 16 in the last 12 months and we got two more on deck as we speak.
Joel: Great. So talk about your growth here in Indianapolis, what you're looking to either from a real estate standpoint or a ramping up employee standpoint. What will it mean for the local economy?
Aman: Yeah, this was a really important part of the story for us. Thinking about Indie largely as being one of a small handful of employment centers for the overall entity. So likely by the end of the year, if you think about the combination of current Jobvite plus Canvas, plus Growth, and I think we're easily in the 50+ employees territory, which is becoming significant tech employment headcount.
Aman: More importantly, though, I think that's just the 2019 story. I think what's most important is attitudinally, you talk to Dan, you talk to K1, obviously you're talking to me, Indianapolis, as far as leveraging the SAS strength here, is absolutely part of the thesis, and I would say part of why we're part of the story as well.
Chad: So was Dan all in with Indianapolis knowing Salesforce is here, TechPoint, there's a lot of growth in the tech sector. Was that hard to sell him on or was it really easy?
Aman: I wouldn't say it was a sales process so much as beyond Jobvite. And there's just a tremendous amount of interest in the Midwest right to have a non coastal employment center. And so, I think you saw, Greenhouse make investments in Denver, you're saying lots of companies with additional footprint in India, whether it's Infosys, whether it's Superior, whether my last company Apparatus a acquired by Virtusa. So I think you're just seeing that trend and I think Indie is riding that wave, and then we're fighting for owned it differentiation as a city across a lot of cities that are doing pretty well in tech. But we're doing very, very well.
Aman: So I think it was not a sales process, the indie part, I think it just made a lot of sense and was part of the very, very early conversations. And to give Jobvite credit where credit's due, they'd already started investing in Indie prior to the Canvas acquisition as well, because they saw the talent pool here.
Aman: So I think what you find is that, okay, you got Canvas, you got the team that's already here, that's probably going to lead to even bigger and better things. So, we're looking forward to that. And I think that's a fun part. It's a fun part of the gig now for us to go from a seed stage company where, as you know we got a lot done across the six of us, seven of us, we just hired-
Chad: Dude, lean and mean.
Aman: Yeah, lean and mean.
Chad: Lean and mean.
Aman: So we brought on seven and eight as we were closing the deal. I mean, we got a lot done for such a small team. But we're also very excited for the help, we're looking forward to just going out.
Chad: Yeah, just double up on the Jergens and the tissue.
Aman: Yeah, yeah, yeah, yeah. There's a lot we'll be doubling up on like more coffee, Chad. Exactly.
Chad: So from a reseller standpoint, is everything business as usual or have things changed? I mean, this is a big roll up, man.
Aman: It is a big roll up.
Chad: This isn't just Jobvite coming in and say, "Canvas, you're my boy, boo. This is Canvas, Talemetry. I mean this is RolePoint. This is big. So from your standpoint, being a part of this big roll up, what's the big priority for you right now?
Aman: This sounds cliche, but it's like the most important thing. It's like don't get distracted at the end of the day. I think folks can get distracted, you can start honestly doing too much, too fast without there being an understanding of what really matters to the client, so I think what K1's done a nice job of Jobvite, RolePoint, Talemetry is we kind of operate with this do no harm philosophy. Like, we all have great things going. The goal is to have something great going together. Let's not screw things up in the, in the interim of that step.
Aman: So I think it's been a focus on the client experience, like I'm building out the team here, I don't know folks in California needing to interview the folks that I'm hiring. I mean, we're running our playbooks. There are times where I call because I want to get, "Hey, what do you think about this kind of role?" But like it's a very supportive environment across the four companies right now. The CEOs of the four companies, we chat once or twice a week formally and then a lot of a one-off conversation. But it's a lot of just seeking to understand, I would say, like making sure that we're being really thoughtful. I think the part that's been exciting is seeing a Jobvite customer that didn't have Canvas before, Canvas customer that didn't have Jobvite before or even we've got inquiries coming in from even Talemetry folks now saying, "Hey, we're interested in Canvas."
Aman: So I think that whole technology integration, conversation is really, really exciting. But I think just start screwing up a really great thing that all of these companies had going is the really important part, on day 1 through 15.
Joel: A little bit of a macro question. In your history, you started with Chacha, which for those who don't know was basically you used to be able to text a question into the short code Chacha. I don't know what numbers those were, I'm sure you do.
Joel: Yeah. And you would actually get a text answer back, sometimes manually. That business is no more, the smartphone killed that business. Do you stay awake at night ever thinking about messaging, texting, losing, or if fatigue setting in because it used to just be, I'd get text messages now I get text messages, I get Facebook messages, LinkedIn messages, Twitter direct messages. I get so many messages that I fear that for businesses that make their living on messaging, maybe there's some fatigue, maybe something else will replace that. Does that keep you up at night, or what are your thoughts on that?
Aman: A lot of thoughts on it. I think the first one is, and I mentioned this last
time we spoke too, we were very conscientious that text is not part of our name has a company. We really felt like what's really important is that messaging, there's always going to be some sort of messaging, right. Not even applied ZING but sure. But I think we were always thinking about the long game. So you've got messaging, that'll always be important, conversation, that will always be important. And then the medium shift, right? And you've seen my tongue in cheek Vimeo video where I talk about the homing pigeon ... and I think that stuff's true. The recruiters continually have to adapt. There's something really important to understand about these channels right now, which is the way that the APIs for Facebook and WhatsApp and so forth, they don't function the same way as SMS, right?
Aman: And so, all these things will continue to be important. Whatever the next messaging app will become important. But ubiquity allows you to do more, just like we, we can do more with email, phone calls and text and those other channels are just scratching the surface of what's capable. If the labor market shifts and it gets a little less tight and the power shifts back to the employers, then you're going to see those other channels take off faster. But the reality is those channels rely on 100% inbound approach. You can't just reach out to somebody on Facebook Messenger and be like, "Hey, are you interested in this opportunity that you applied for?" You can do it on your personal channel, but you can't do that through the B2B API side.
Aman: So I think that there's just a lot that has to be worked on, and I'm as confident as anyone that SMS will have a half-life just like other communication platforms have had. I wouldn't say it keeps me up at night. I think we're still in an age where, I mean hell, there's still email marketing technology companies launching, right? And we're on about year 20 of that, so I think we got some runway, but I think it's important to keep our eye on the future and how do we make sure ... We from the beginning it felt like we're a headless application, ultimately. And we chose our first volley to be SMS. But I think you'll find us having that same omni channel approach at the end of the day. That becomes a requirement.
Joel: Do you envision any particular headwinds for the 10-digit number text messaging business versus the short code five to six digit where there's more, I guess, legislation around the five to six and that ended still sort of the Wild West. I assume legislation will eventually come to that. What are your thoughts?
Aman: Yeah. We want to be part of the solution here. I have a lot of thoughts on this, which is I'm sure at some point in time somebody may come screw this up, and we are absolutely not going to be the entity that does that. So we're very, very careful. Lots of governors in place, we drive organic what we call organic experiences, so there's no list loading any of that stuff in Canvas software. Inevitably this could happen. Someone could jump the shark here and that might require legislation that you would want, that I would want, that others would want. So I wouldn't even argue that I'm anti legislation here. I think, to the degree that this becomes a problem, we should take a look at resolving it. I'm the last person that wants to be bothered via text message as well from something that doesn't feel like it should be there.
Chad: Oh yeah. So we know Canvas Bot is out there, right? Talking about messaging, but then there's the whole chatbot, chatbot, chatbot kind of scenario that's out there. So when you're talking to clients today, or even when you were talking to Jobvite, was that something that perks them up to want to have more of a discussion, or was it just really just predicated on the messaging aspect of what you guys do? Because there's a lot of noise that's out there and chatbots are creating a shit ton of noise. Did that help? Did it hurt or did it not even matter?
Aman: I would say messaging is the least interesting thing that Canvas does. If f you've missed the plot line, if you think that's what's interesting about what we do, I think it's the tooling and we started rightfully in a world where we thought semi automation was the first way to go in, and you had an inside view on this where ultimately we were structuring the recruiter's side of the conversation through the questions library and those libraries that we'd created. Then we rolled in before we launched recommended answers, so the suggested answer pops up. And then the goal is just, how do you structure the other side of the equation and start to get better data? So ultimately the messaging part, they paid way too much if they acquired us for messaging. I put it that way.
Aman: So now let's talk about Canvas Bot. I think our paper is written a little bit differently versus the other papers out there in that we believe the right place to start was a mobile centric experience. And if you're going to talk about mobile centric, we wanted an experience that didn't require an application to be downloaded. I think that if you think you're going to build your business in this labor market, expecting people to be sitting in front of their laptop while they're in a discrete window of time with a little chat bubble window, you're super confused about human behavior right now.
Aman: So the reality is that Canvas Bot and the conversational engine that drives it, it's really powerful and people confuse it because they want to see this web windows-based experience. Reality is go try those and let me know what you think about them and ask them any questions that you like, and it'll keep referring you back to the same website that you're already on. It's like, "Hey, how many interns do you hire this year?" "If you're interested in applying, it's at Acme Corporation." I mean, it's just a nonsense experience. I agree, Joel, I hope it gets better over time, but I think what we're trying to say is, "Hey, let's build a bot experience that meets candidates where they are today." That was in our very first marketing material.
Aman: And so I think people are missing the plot. If you're building for this web based window experience, you're just missing what's happening right now. And I would argue your bot is very compelling, it's just built for the world that's on your phone, not the one that's on your website right now.
Chad: So that being said, the application process sucks. For most companies, when you go directly to an applicant tracking system, when you have to go through and actually rip apart your process because your instituting Canvas, does that start to help companies better understand the shit that they've sent candidates through over the years and really help them focus on user experience?
Aman: I think whether it's Canvas, whether it's Talemetry, which that I would argue that was a lot of the value they're bringing to a lot of enterprise Oracle clients. How do you really rethink the UX? I think whether it's us or the 50 other companies that are going to launch this month, I think so much of it is just UX innovation, right? Like how are we going to move the user experience forward? And what we were trying to do was to move the ball forward with regard to this, no app needed experience, we'll take care of plugging the data in to the ATS or to wherever you want it. And I think we're still scratching the surface of what's going to be possible, both inside and outside. And I think sometimes we want to call it an AI revolution or an HR revolution. Really, it's a user experience revolution. Right?
Chad: Yeah. Yeah.
Aman: I mean, that's really what it is. And I think that's the really important part. And the other side of the equation then is the companies automating what can be automated right now. And we've talked about this, I think too many companies are selling autonomous driving when we still have NC cruise control, and we're just not going to be that company.
Chad: So you're not just going to say AI [crosstalk 00:20:32]-
Aman: No, and we're not going to tell people our product's going to do things that it doesn't do, and that no one's product really does. One of my things as any of these companies, if their product actually did what they said they did, they couldn't be shy of a $1 billion valuation now. Right?
Aman: It's impossible, right?
Aman: So help me understand the $30 million valuation. So I think we're just losing the plot line. We're kind of taking advantage of a buyer that has just a lot of information they're having to sort through right now. But if you think about the technology being sold and the valuations aren't even close to matching up right now. And I think that's the first tell that we have a lot of work left ahead of us. Right?
Chad: So, I mean we talked to Dan Finnigan last week, CEO of Jobvite, and we were talking about modeling. And you can't really look at the HR industry to model. And he kept saying sales and marketing and looking at those different types of industries to be able to focus on technology because that's all predicated on revenue. It's all predicated on ensuring that you do have a great candidate experience.
Chad: So from a Canvas standpoint, is that where you guys really saw ... because that's exactly what it sounds like you guys are doing. Is that where you guys gelled, and knowing that you had the same kind of focal point?
Aman: Yeah, I would say so. I would say that there are lines of even Jobvite's evolution from kind of where they started with social and email, where there's no doubt that that early emphasis on communication and messaging and channel, I think helped us be pretty congruent with how we fit into that overall ecosystem. So I do think that Jobvite saw many pieces of this pretty early, and I think we helped fill in a missing piece to that story.
Aman: But I think messaging, again, it's really the least interesting thing. It's the engine behind it.
Joel: I have a couple of, I guess, I'd call rapid fire. We'll see what your answers are like to see how rapid that is. [crosstalk 00:22:44] Yeah, I'm totally a motivated.
Joel: One of the first things I got on you about when we first met was your domain, gocanvas.io. Does the extra funds give you the ability to like go get a real URL at this point?
Aman: It's a great question. I'd like to spin this another way, Joel, I'd like to let all the young kids out there that want to start a startup just know that you can have a really shitty URL and still go crush it. So how about that? That's the way I like to answer that question.
Joel: Boom! Okay. That's not the only one. Yeah, I know. What was the price tag for Canvas?
Aman: It was $1.7 billion.
Joel: Tongue in cheek on that one. They raised 200 million for the three acquisition. So I'll let my listeners do the math on that one.
Aman: Obviously can't articulate the no, I was totally ready for it.
Joel: And then lastly from me, because I'm getting hungry. You have a history of starting companies, being a part of companies, selling and then getting out in a fairly short order of time. Should we expect the same out of your experience at Canvas? Are you dedicated to the long haul with seeing this company for the marathon, are you in it to get it up and running and going and then up to your next startup?
Aman: I'll give my honest, but what you may deem to be, political answer. When we sold Apparatus, I didn't have a specific timetable. I wanted to finish the job. And I will tell you, like right now I don't have ... I mean, here's a part of the contract I can tell you. I'm not here today because I have to be here today and I'm not working at [crosstalk 00:24:26] Canvas today ... more broadly. To me, the work's not done, and to me, life's about a collection of interesting experiences. A, let's go fulfill some destiny that's still left with Canvas. Two personally, right, I'll make it personal, I like learning and if I wake up today and say, "Where can I learn more?" Would it be conjuring up my next idea on a piece of paper or working to figure out what a four-company integration opportunity looks like.
Aman: And so I think for me, the business problem and the opportunity is still really, really interesting. And when I wake up one day and I'm like, "Oh man, I think it could be more interesting elsewhere," then maybe that happens. But I would tell you right now we're not there. Now with that said, if after this podcast Dan's like, "I don't like what you just said on that," and he fires me, then maybe I'm off to my next thing. But no, I think the job's not done. And when it is done, I'm sure we'll all be hearing about it, but right now it's not.
Joel: So piggyback on that, and I'm inspired to ask another question. Chad and I've been doing this for a long time and we've seen companies come and go. And there seems to be an underlying fact that people who come in that aren't of this industry tend to not last very long in this industry. You are a rare exception and success story. So for anyone that's looking to come into HR tech or recruiting solutions, what advice would you give them as someone who was, I guess, an outsider to our industry? What advice would you give them to being successful in our space?
Aman: Sometimes I get as far as writing the first sentence of a blog post when I never write. But I will tell you this, so let's just write it in real time. To your point, had I really understood the space, I don't think I would have launched Canvas. Do you know what I mean? I think it would have felt like too impossible to me. And I actually think that the ignorance-
Chad: Is that an adoption type of thing or what?
Aman: Yeah, I think it's an adoption thing. I think the buyers, it's a very different buyer than [crosstalk 00:26:23] we've talked about this-
Chad: So reticent, right?
Aman: Yeah. It's reticent, it's complicated. I think you've got this emerging group of HR leaders that the rest of the leadership team is still catching up to understand that this has to be a really important part of their business. Here's an example that I talk about often. If a CEO is working on their next round of financing, they're right there with the CFO at the bank, right?
Aman: If you're working on fixing a shortfall in your sales plan for the year, what's the next big pitch I can go to with the sales VP? But, for all the talk that CEO's do about talent, what's the first thing they even know about their talent pipeline? When's the last time they showed up on a college campus? So I think part of it is, is that, look, a lot of people want to go blame HR leaders. I don't think that's the case. I think CEOs are kind of full of shit when it comes to talent. They talk about it. They don't spend nearly as much time understanding that except when it's in the papers to talk about, I got a shortage of this or I need grant money for that.
Chad: It's a canned quote or something.
Aman: Yeah. But they don't really go work on the problem. And so I think that then creates a larger challenge as a SAS company because these are fake dollars in the paper, right?
Aman: These aren't real dollars that they actually want to spend. So I'm really glad we did it and I'm actually glad I came into it ignorant of that because I think when we were building companies in the past, the only reason we were successful is because of our focus on talent. We were obsessed with it, and at Apparatus we were obsessed with it. So I just took for granted that that same obsession existed at the leadership level, and I really don't think it does. I think it does in the newspapers and it does when it's convenient, but it really doesn't when it comes to the blocking and tackling the running of a company.
Chad: So it seemed from the outside that you guys were hyper focused on exactly what you were trying to get done in the platform. You weren't trying to pivot every six months. And that's hard, especially when their perspective investors out there and companies are saying, "Hey look, I'll give you some cheddar if you do x, y, or z." What, and again, back to Joel's point for all those other startups that are out there, what can you say about startups and really being disciplined and not getting into pivot mode?
Aman: We should start getting a little bit of a allergy to that word. There's a couple of things that happen there. One is not enough thoughtful research before you launch. And I think not enough like iteration, so getting the product in your hands. I think sometimes we want to maybe blame the customer, that they don't get it and therefore we pivot versus just going, "Hey, what's not right about my platform yet?" And sometimes you can just be one minor ingredient off to make that cupcake tastes great. I think there's a lot of companies out there that-
Chad: Instead of scrapping [crosstalk 00:29:19]-
Aman: That's exactly right, that just probably needed to keep listening. And I think we loved being so small because we were so raw and close to our customer and client all the time and we're naming features after recruiters and having a really great time doing that. But I think that too many folks maybe pivot to early, easy to say for the person who didn't pivot and had an exit, so I recognize that. But I do think that there's, I think we should have some fortitude about what you're trying to do.
Aman: One of the ones that were always fending off was, go become a sales marketing company. Take this, this is unbelievable platform. We had clients asking, "Could I use this for our customer care op?" "Could I use this to communicate with our clients?" And we just kept saying no. And the reason we said that was our value was in the tightness of the relationship we were creating between the recruiter and us. And were just like, that's it. Nothing else really mattered. And we'd always joke maybe five years down the road, yes. But right now we can't do that.
Chad: Aman, I would like to thank you. Another high five.
Aman: Yeah, thanks.
Chad: Great to see this happen. Joel is over here withering away, so we need to get lunch and probably some whiskey.
Aman: Yes. We win Joel Cheesman’s shittiest company to ever launch and have amazing exit with gocanvas.io. That's gocanvas.io. Now keep in mind, little ones out there that are going to launch a company. You can absolutely crush it. Deal with Joel knocking on your URL every day. But I will tell you right now, I'm glad I never spent the money on it. I'm glad I spent it on amazing people and customers. Thank you very much.
Joel: We out.
Chad: Boom. We out.
Ema: Hi. I'm Ema. Thanks for listening to my dad, the Chad and his buddy Cheese. This has been the Chad and Cheese Podcast. Be sure to subscribe on iTunes, Google Play or wherever you get your podcasts so you don't miss a single show. Be sure to checkout our sponsors because their money goes to my college fund. For more, visit chadcheese.com.