Layoffs! Just when you thought it was safe to go back in the water, Indeed dropped a layoff bomb this week, saying adios to 2,200 employees. Paradox officially launched an applicant tracking service, telling Fountain AI, “hold my beer.” Rippling slimes us, Ghostbusters-style. The boys play a little Buy-or-Sell with Rain and RiseKit. Karat acquires TripleByte’s tired ass and Dice gets a proverbial smackdown from the Feds. Whew! There’s a lot of meat on the bones of this week’s show, you lucky bastards.
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Intro: 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: Oh yeah. It's National Cocktail Day in America. Would someone pass the old granddad and the old fashioned mix. Hi kids, you're listening to the Chad and Cheese Podcast. This is your co-host Joel 'Make the next one a whiskey sour' Cheesman.
Chad: And this is Chad 'Hunger Games' Sowash.
Joel: And on this week's show, it's a Paradox Fountain Smackdown. Indeed gets a haircut, and today's cocktails are generously donated by our friends at Rippling. You'll understand what we mean in a second. Let's do this!
Chad: Greetings and salutations my friend. Hello, yeah, I actually have some cubes that are for like easy old fashioneds, and I know that Christine loves old fashioned so there are these really cool cubes that have all the ingredients in it. You just put it in, muddle it up, and you're good to go. Takes seconds.
Joel: She loves old fashioneds as long as they're made with Canadian rye.
[vocalization]
Joel: So we had some fun with the Swedes this week.
Chad: Been a blast.
Joel: That was a good time. That was a good time.
Chad: Yeah. Good time with the kids at Adway...
Joel: In Sway.
Chad: Over at Adway, yeah.
Joel: Adway. Nothing says Sweden like an Amway sounding name like Adway.
Chad: I wonder if they even had Amway.
Joel: No, it's probably Swedeway. Sweway. Probably did not... She probably doesn't know what Amway is.
Chad: No.
Joel: If it's even still around any more.
Chad: Multi-level marketing fiasco is what it is. [laughter]
Joel: Oh my god. Was it Avon, that was the beauty stuff?
Chad: Yes.
Joel: Yeah, my mom did Avon. She would have these parties and have these scents and they always had the cologne that was like in a car. Shaped like a car.
Chad: Yes. The Batmobile.
Joel: Yes, and the gas tank was where the screw was and you'd be like a little aftershave with some Avon Batmobile car. Holy shit.
Chad: That's awesome. Well, still... I digress. Adway, thanks for having us on. It was a great time. I guess there were like 1,800 registrants and there was a shit ton of people who actually watched us live.
[applause]
Chad: We will be putting it out audio-wise coming up probably Monday or Tuesday next week, so you can check it out there or you can go to the video on LinkedIn.
Joel: Absolutely, and if you want us as a guest on your show, we have a lot of fun on these things, so hit us up, hit us up. But let's get to shout outs because...
Chad: Shout outs.
Joel: Like you said in the green room, there's a lot of meat on this skeleton this week.
Chad: Yeah.
Joel: So my first one goes out to Upwork. Nickel and diming has come to the gig economy, Chad. Beginning April 26th, Upwork will be implementing a client contract initiation fee of $2.95 on Upwork's talent marketplace and Project Catalog. This is assessed when you make your first initial payment to a freelancer with an estimated 225 million remote knowledge workers in the world. If just one contract is connected to each person, that means over 663 million more dollars to Upwork's bottom line. By the way, that's ticker symbol UPWK in case you're interested in investing. I'm not a shareholder but shout out to nickel and diming at Upwork.
Chad: Can't wait until Upwork starts the whole Twitter/Facebook checkmark thing with the users. I mean, because they'll do that too, right? There's just these little nickel and diming ways to hit employers and contractors. I mean, it's gonna happen guys.
Joel: It's gonna happen. Maybe Indeed's gig economy can put them down and we won't have to worry about nickel and diming.
Chad: Cost per gigger.
Joel: Cost per gig, initiated gig. Yes, CPIG.
Chad: Initiated gig. [laughter] All right, you keep going. I've got one big shout out at the end, so you finish yours out.
Joel: All right, cool. So, Hireology, shout out. Let the ChatGPT races begin. Our friends at Hireology have launched Beaker. Remember Beaker? They were a thing for a while. Beaker.com. Anyway, I digress. Beaker is an AI-powered recruiting assistant that can generate job descriptions in seconds. Beaker is powered by ChatGPT. The tool is designed to automate some of the more time-consuming parts of the job creation process, freeing up time for recruiters and managers to focus on other tasks. Me thinks they won't be the last to use ChatGPT, and I hope vendors like Textio are paying attention to this automated job description creation thing. Shout out to our friends in Chicago. Get your Chicago dog in your deep dish ready at Hireology. They're going ChatGPT and as their press release says, they're the first in our space. I don't think they'll be the last.
Chad: We don't know though because last week we talked about Fountain AI. We're not sure if that was ChatGPT. They didn't go into any type of details about that one. So, who knows, right? Who knows anymore?
Joel: First is usually just, "We're the first with a press release," that says we're the first.
Chad: Well, all I have to say though is get ready for the ChatGPT-like gold rush kids. It's happening.
Joel: Yep. Chad and I have seen demos. We know a little bit about about what's coming. And my last shout out before you get to your mega shout out goes to Jay Dotson, Director of Talent and Management. This is a recent comment that he had on LinkedIn. But anyway, we're gonna talk about layoffs at Indeed. Here's a little bit about Indeed's performance lately with all the changes. Jay says, "Recent Indeed issue that I found when using EasyApply recently, resume parsing isn't coming into my ATS. I only get the resume. Takes my recruiters much longer to review them. All my other sources parse including LinkedIn. Ran the numbers and I get just as many applicants from LinkedIn. I stopped sponsoring as much with Indeed after Jim Durbin, the Indeed whisperer, came on your show. Indeed just wants us to go to their site just like you guys say." Yes, shout out to Jay Dotson. Suck it, Indeed.
Chad: Suck it, Indeed. Yeah, I mean, again, this product is so full of fucking holes. Well, we'll talk more about that later. I don't want to get up on my stump just yet. So my shout out is very sombre and celebratory at the same time because we lost pretty amazing dude, Scott McCray last week. I was lucky enough to actually have spent some time with he and Adam through advising candidate ID. Loved working with both of them, whether it was on Zoom calls, texts, at conferences, arguing about go to markets. I tell you what, let's have Adam Gordon talk a little bit about it because he's much closer than any of us were to Scott. So play that beautiful beam footage.
Joel: You got it.
Adam Gordon: Okay, so what can I say about Scott McCray? Probably many people listening to the podcast will have met Scott at the events he was at, the many events he was at in Europe and in North America. Rocking his kilt on stage, waxing lyrical about talent funnels and spearfishing, unleash HR tech, both in Europe and in Vegas, at a hiring success in San Francisco, winning awards all over the world. Back in 2015, Scott taught me that there was an established solution to the problem of not truly understanding which candidates were clicking. And that was marketing automation. We spent about 18 months trying to work out how to build a tech product because none of us have done it before. And then he eventually launched Candidate ID in January 2017. Spent the next six years touring the world selling marketing automation to TA teams in our kilts.
Adam Gordon: Scott brought some real sophisticated thinking to our industry in the context of talent nurture, personalization, automation technologies, and everyone he met learned from him. I absolutely loved turning up at events, like the evening events in particular, like the workday parties and stuff like that. And Scott and I would turn up, we'd just like high five each other at the door, and then not see each other for five hours. But I catch glimpses of him all, like, regularly just go over to people and introduce himself, groups of people he didn't already know and just start talking. And, everybody enjoyed his chat.
Adam Gordon: Before Candidate ID, Scott had a really interesting career. He started in sales and marketing with P&G, and then at Hugo Boss, and then in the wine industry, which took him on a big adventure to New Zealand. So he literally turned up in New Zealand, and told some vineyard owners that he'd teach them sales and marketing if they taught him how to make wine. And one of them, one of the big ones said, "Okay, that's a deal." And he spent 18 months there, just learning how to make wine and helping them with their sales and marketing. And that's just what he was like in search of adventure. The world was literally open to him. It was his playground. And then more recently, of course, after we sold Candidate ID to iCIMS, he became very popular within the business, helped iCIMS guide their strategy around marketing automation technology, and led on the RPO efforts as well. So from making wine to working with RPOs on their tech strategy, he was pretty adaptable, I think you'll agree. So I announced his death on LinkedIn a few days ago, and I had a real surge of emotion when I saw the comments coming in. He had so many friends in our industry, despite only being part of it really since 2017. He was very well liked. So Chad, Cheese, I know he loved you guys. And thank you very much for inviting me to say a few words about him on the show. Look after yourselves, everybody. All the best.
Joel: Yeah, the word adventure stood out to me.
Chad: Oh yeah.
Joel: And both Scott and Adam, and all the Scotts I know sort of exemplify adventure and...
[laughter]
Chad: It does.
Joel: Sort of enjoying the moment and meeting new people. That's kind of my takeaway. You knew Scott a lot better than I did. But yeah, I always got a warm, fuzzy feeling when we hung out.
Chad: He always had stories, and he always listened and wanted to be a part. I mean, just the interactive and amazing and incredible business smarts as well. So we're gonna miss him, but we should all cherish the time that we had with him. But one thing that Scott did love, which is where we're going next, Scott loved events, because that's where the people were. And we're going to talk about events where we're going to be at Unleash America, April 25th through the 27th, happening in Vegas at Caesars Forum. They have new digs. They moved from the MGM. They're upgrading, kids. They got that gambler upgrade, I think is what they got. [laughter] They're gonna be at Caesars Forum this year, right next to that big ass London Eye ferris wheel thing...
Joel: Yeah.
Chad: That takes 30 minutes to get around. They have bars. You can drink in those cabs and stuff like that. So that is going to be a blast.
Joel: You've had drinks in one of those, haven't you?
Chad: I have.
Joel: Yes.
[music]
Chad: I have had drinks in one of those.
Joel: Chad speaks from experience.
Chad: Pretty amazing. And I know that there are going to be companies that actually rent those things out. And then they take people up and they have drinks and talk about business and all the other fun stuff. But if you have not registered yet, again, it's coming quick. Go to chadcheese.com and click on events in the upper right hand corner and register. Then after that, we're going to go to iCIMS Inspire in Coronado Beach. Speakers are being announced now today on LinkedIn. We're one of the headliners, which is kind of scary and fun at the same time.
SFX: All right, all right, all right.
Joel: It's very scary. Very scary. We're entertaining though. We'll be good. We'll be a good time. We'll be a good time.
Chad: Yeah. Well, I've never met Brian before, so this is going to be really fun. Now, meeting Steve and then talking to him, doing interview with him and whatnot. Now, Brian, he's an unknown entity to me right now. So, I might have to do a little research.
Joel: Yeah, and he's agreed to be on stage with us in less than a year of being in that job. So I hope he knows what he's signing up for. It'll be a good time.
Chad: I'm sure he doesn't.
SFX: Whoo! Really? Can you feel the tension in the air right now? I know I can. I can feel it all the way down in my plums.
Joel: That's right. That soundbite means we've got birthdays to celebrate this month or this week, Chad. And if you don't know if it's your birthday, if you've signed up for free stuff, then let me just quickly talk about that, you've got to go to Chadcheese.com, click on the free link, submit your information. Your birthday needs to be in there. And if it's your birthday that month, there's a chance that you can win a rum from our friends at Plum, but otherwise there's t-shirts from JobGet. There's whiskey bourbon from our homies at Textkernel and free beer from Aspen Tech Labs. We're creating a lot of smiles out on LinkedIn. If you haven't seen them yet, a lot of stylish, good looking people on our t-shirts and yes...
Chad: You could be one of those people.
Joel: But you got to play to win Chadcheese.com. Click the free link and celebrating a birthday this week, here we go, Timo Hillhorst from Melbourne. I don't know in Australia, is it Timo, Timo?
Chad: Timo?
Joel: Timo. Timo.
Chad: Okay. I like it.
Joel: Anyway, and Timmy Smith. Timmy and Timo are celebrating birthdays. Josh Winwright, Brian Barnes, Hayden Hughes, Derek Bond 007, shaken not stirred probably.
Chad: Very nice.
Joel: Melissa Malcolm in the middle, Audra Knight, punk rocker, by the way, she's got some good tunes. Jason Warner, Keith Robinson, Jamie Leonard, one of our favorite Brits celebrates a birthday, and my big sister, Holly Cheeseman Bricker celebrates her birthday this month.
Chad: There we go.
SFX: Happy birthday!
Joel: Happy birthday to everyone and thanks for listening to the Chad and Cheese podcast.
[music]
Joel: Topics. Oh, no. We're back to...
SFX: Playoffs.
Joel: That's right. We got layoffs this week, everybody. Let's go through these real quick, and we will comment in depth afterwards. Amazon, another 9,000 layoffs. Meta, 10,000. Bonusly, we don't know how many, but they just got funding, which seems to be a popular thing to do in our industry, get money and then lay people off. Workhuman laid off 130. That's according to layoffs.fyi. But most notably, our favorite punching bag Indeed has cut 2,200 workers or 15% of its workforce due to the, "Cooling job market outlook for the coming years." The cuts affect, "Nearly every team, function level and region," of the company, including Indeed's workforce in Singapore and employees at its sister site, Glassdoor, to the tune of what we hear is 140 employees. CEO, Chris Hyams, who looks like our love child by the way, Chad, he's a bald guy with glasses. Anyway, he says the US job market is expected to decline to pre-pandemic levels of about 7.5 million or lower over the next two or three years, prompting the job cuts. Chad, our mailbag blew up after this one. What are your thoughts?
Chad: Yes, it did blow up. I picked two. The first one was actually from an Indeed client. And here's the quote. Holy shit. The Indeed layoffs were apparently ugly. They had a 15-minute webcast with the CEO in which they announced the layoffs and that you may receive an email within the next 10 minutes if you are among the folks laid off, at which point the webcast ended and the screen went dark, which apparently sparked mass hysteria, as you can imagine. They put job seekers first. And when it comes to laying off employees, they go with the, "Fuck them kids approach." So that was from a client. Okay. And then we've got one from an ex Indeed employee. "The problem is Chris Hyams. He is so, so bad. He switches models at the worst possible time, which makes people look at what they are spending just as applications are increasing. So suddenly you don't have to sponsor jobs because your organic gets good results. Then he offers a 25% pay cut, but he's paid so much that nobody cares. So the guy is totally out of his depth. Chris Hyams should tend his resignation today."
Chad: So could this CPA, CPSA be the Trojan horse that Indeed unleashed on itself? They've been the Trojan horse launcher for other organizations for years. They've been known to do that. This feels like they're launching one on themselves.
Joel: Yeah. The proverbial shooting yourself in the foot has been a theme of Indeed's for years now. And it sort of really started with Google for jobs, some fear of that, let's launch some new stuff, try some new stuff, buy some companies that didn't work out. And I think it's all coming to a head with the current state of layoffs everywhere. There's some nice cloud cover by your boy Elon Musk and laying off people is an okay thing to do. I thought Indeed might avoid it. I thought they might, we're such a big swinging dick that we don't have to lay off people. They are human. They do bleed. And they laid off 2200 people. Obviously, that's a shame. Heart goes out to all those people that were laid off. However, if you listen to our show, a lot of companies in this space are raising a lot of money and need a lot of good people that have experience, which these Indeed folks do have. So hopefully, I know that a lot of Indeeders listen to the podcast, hopefully they've got a short list of companies that have raised money that they can go apply to and land on their feet.
Chad: Timing is horrible, new product is horrible, which we actually had somebody earlier say. Clients are tightening their budgets, ChatGPT and other chat platforms are prepping a run-on jobs for prospectively fake resumes. Google for Jobs beta testing their paid jobs. The list goes on and on and on, and Hyams makes this very bad move. Although, I don't believe Chris should take a 25% cut in pay. He should, much like you said earlier, he should tender his resignation. If you're going to cut that many people, if you're going to impact them with these stupid ass product, I mean, holy, bad product moves. His total comp SEC filings was close to $14 million. Take some money, take some money, go buy a fucking island and get the fuck out of Indeed and let somebody clean that shit up.
Joel: Pretty sure Art Zeal and our man, Scott Gutz might be open to a new CEO gig in our industry.
[laughter]
Chad: This opens the space for a company like Monster, not just to ascend to the mountain top again, but to at least make some ground. If you think about it, if I'm a Monster sales guy right now, I am licking my fucking chops.
Joel: Yeah, I'm sure all seven of them are foaming at the mouth to call on those, all those Indeed accounts.
Chad: If you're a sales guide, you're always foaming at the mouth.
Joel: Alright, that is our layoff update. Let's get to some real news, shall we? Paradox, somebody who hasn't laid off anyone, I think, at least they didn't announce anything.
Chad: Oh, knock on wood?
Joel: Yeah, I think they may be the one immune to all of this. Paradox has launched its conversational ATS, which automates tasks such as screening for requirements, interview scheduling, reminders, offers and new hire onboarding to re-imagine the high volume hiring process. The ATS uses a conversational UI to make engagement feel what it says are simple and seamless and helps global clients reduce time to hire to hours or days. Paradox is also launching high volume solutions built to work alongside enterprise ERP and HCM platforms like Workday, who we've speculated could write a check and just gobble up Paradox, and SAP, another big check writer, by the way. Last week, we talked about ATS for high volume hiring at Fountain. They launched Fountain AI, that's creative, a conversational AI, and now we got Paradox. It's Tyson-Holyfield without the ear biting. A lot to unpack here, Chad, what are your thoughts?
Chad: Yeah, it's too early to calling it the ear biting by the way. This is welcome to the next generation of applicant tracking system wars, baby, and it's about fucking time. We saw this coming with Paradox. We talked about how this new generation of applicant tracking system would look, exactly like Paradox and/or Fountain. Most traditional ATSs are jamming a square peg in a round hole when it comes to volume hiring, and as we already know, the apply process for a data scientist needs to be much different than that for a hotel concierge, but we're still jamming everybody into that square fucking hole, but not any more.
Chad: Chat allows a different and much better mobile engagement that I don't have to complete the app before my session times out. It can be asynchronous. It can also nudge candidates to finish their applications, be ready for interviews tomorrow and prepare for their first day of work. Here's the biggest point that needs to be made. Paradox is now saying that it can be your system of record. That's fucking huge. Anyone who has ever had an audit understands that record-keeping is a make or break situation. I do find that it's interesting that as Fountain comes out with Fountain AI, their conversational product last week, Paradox, this week, says, "Hold my beer." That's just something that Paradox CMO, JZ, we know JZ really well.
Joel: You think they pushed a button on that one?
Chad: Josh Zywien does better than most. He keeps his powder dry, and you know Aaron much better than I do, but he's been more patient around Paradox and rolling things out. And the last thing I'll say is that Paradox's new President, who used to be their Chief Product Officer, is one of the best product people in the business. Back in 2016, he was building Gen 1 of this product, with baling wire, low budgets and duct tape. Now, Adam Godson has budget and he has the opportunity to go out there and build what he knows works. I said last week, I love the Fountain-Paradox collision, because we need those types of brands and products in the market to be able to ascend from a competitive standpoint. That's how innovation happens.
SFX: That escalated quickly.
Joel: It was more Olivia than it was Paradox when it first launched. And I remember the first time Olivia was at an HR tech or one of the charms, and Jobing was still alive and well at the time, still is, it just doesn't belong to them anymore. Recruiting.com, which they own as well as a thing. But I remember the excitement in Aaron's eyes, and you mentioned I know I'm a little better than you do, and I do say that's a true statement, and when Aaron gets excited, you kinda know if you know him. And there was a level of excitement that you thought, he's got something here because he knows he's got something here. And he was demoing the product, and I remember people would come by that are knowledgeable, would say like, "Well, how does it integrate with the ATS?" And you could tell he would kinda grit his teeth because I don't think they integrated with any ATS at the time, but you knew that he knew, at some point we're gonna have to integrate with the ATS.
Joel: So it's really, the tables have turned in this fact that they're becoming the ATS, and you point is, I think, well taken, and I had in my notes written this as well, is that if you can create a new technology or a new product that already leverages what consumers know and what they're used to. Part of ChatGPT success is that Google got people used to writing words in a box and getting stuff back. That wasn't always a thing. One-click apply, that works because people are used to one-click shopping. If you can tap into what consumers know, you're well ahead of the game. And if you can apply to a job via something that you know really well, that resonates with almost 100% of consumers, well, by God, you got something. ATSs are not organic to people's usage of the internet.
Chad: No. No.
Joel: It's clunky, it's a pain in the ass, it's cumbersome. Paradox is not. Paradox is a search box like you would text your wife or friend, and you can apply through that process. Having an ATS is a natural progression of this service. I think if you're a traditional ATS, you're a little nervous about this. To what degree? I don't know. You mentioned high level executives versus frontline workers. I don't know. I think it could work for any level of employee at this point. There was a time where like, "Oh well, if I'm an SVP, I don't wanna go through a chat bot. I wanna apply like... " I'm not so sure. If it's easy and it's something that you do every day, I'm not sure that it can't be any level of job. The question is, is it easier for a chat bot to become an ATS or an ATS to plug in a chat bot? I guess we're gonna find out exactly where we go.
Joel: But if you believe the future is in chat conversational AI, then my money is on the company that started with that is their DNA versus one that started out as an ATS and then they're trying to plug in a conversational AI. This is gonna be a lot of fun to talk about, not just the you guys like Fountain and Paradox, but what's iCIMS's move? What's great Greenhouse's move? What's SmartRecruiters move? Etcetera. It's gonna be a lot of fun to watch. Because ultimately, these services are gonna get acquired and companies are gonna be forced... There won't be any more to buy. They'll have to build their own, and the ones who have it are gonna win, and the ones that don't are gonna struggle, I think.
Chad: I think when you start looking at big enterprise clients that have more than high volume, that have to take coding challenges, they have to take assessments, they have to take all these things, so they have to go through more of a process than just a quick apply like you do as high volume, so companies like iCIMS, they'll be fine as long as they stay away from high volume. But the Greenhouses of the world, that could be a problem 'cause they're more on the SMB side of the house. And most of those positions, not all, but most of those positions could easily fit into Paradox. Paradox is doing enterprise. Don't get me wrong, they're just doing it on the high volume side of the house.
Chad: So I think there's room to play on both sides. It's all about go to market. And the thing I gotta say though, and again, and what we're kind of like fanboying over what's happening at Paradox is Aaron has been in this industry and he succeeded, and he's also failed, and that means more, I think, than anything else, because he knows where he went wrong. Then he got JZ on board, he got Adam Godson on board, he got some heavy, heavy hitters and he's provided them with the autonomy to go out there and just kick ass and take names. Again, I can't wait to see what Fountain comes out with next, and then what JZ and the rest of the team come out with Paradox. It's gonna be fun.
Joel: Yeah, I no doubt. Battle scars, they count for a lot playing within the same industry.
Chad: They do. Yeah.
Joel: And I'm waiting for the shopping to happen. I'm waiting for clearance rack to really be appealing and some consolidation to happen. I'm waiting for that shoe to drop. That'll be really, really interesting. JazzHR is another one that should be careful.
Chad: Yeah.
Joel: Alright, let's talk about Rippling.
Chad: Do we have to?
Joel: More SVB drama. Rippling has raised $500 million.
Chad: Fuck.
Joel: Valuing the company...
[music]
Joel: At $11.25 billion. Okay, stay with us here. The funding round comes after Silicon Valley Bank collapsed, taking with it the funds of Rippling clients. Rippling extended $130 million of its own capital to fund its customers payments with the hope of recovering most of it from the FDIC. The remaining funds were recovered by Sunday afternoon after the FDIC guaranteed deposits. Despite the sudden resolution of the problem, Rippling went ahead and proceeded with the funding round because it believes the price reflects its performance and allows it to focus on building great products. Who could say no to $130 million anyway? Did I mention $500 million at an over $11 billion valuation? Chad, Rippling, go.
Chad: As Winston Churchill famously said, "Never let a good crisis go to waste." Over the weekend, the SVB collapse happened, and we had a bunch of people reaching out to us saying, "We should go on now, we should tell listeners, on Monday, things, they're gonna be horrible. It's gonna be crazy." And my response is pretty simple, government won't allow that to happen. How many times have we seen that the government allows something this large that could prospectively impact hundreds of thousands of Americans? It's not gonna happen. Parker Conrad and Rippling, who had already moved some of its banking business to JP Morgan months earlier, they played off fear and uncertainty on this one, and they didn't let a crisis go to waste. Did they need more money? Who the fuck knows. It's all about solvency, but I'm gonna tell you right now, I wouldn't trust Parker Conrad as far as I could throw that fat bastard.
SFX: That escalated quickly.
Joel: Yeah, if you think that this sounds slimy, listen to your gut. If it sounds kind of like shady, it probably is. Parker Conrad, I wax poetic on him a year or so ago. If you wanna go Google him, Google Parker Conrad and Zenefits for the whole back story on who he is and in his past. It's pretty transparent out there. Look, if companies go out of business because of too much money, these guys are gonna be the poster child for a crash and burn. [chuckle] By the way, if you wanna a really good account of this, go to TechCrunch. They have a pretty good post about this. But frankly, dude, I don't like giving this company oxygen, I don't like giving this cat, Parker Conrad any oxygen. So as far as I'm concerned, I'm done. Let's hear from our sponsors and get on to the next topic.
Joel: Oh yeah, it's time for a little, who'd you rather?
[music]
Joel: That's right. If you don't know, we read two companies, start-ups, if you will, that have gotten funding. I read a small summary, short summary, and Chad and I pick who'd we'd rather. Are you ready, Chad, to play a little, who'd you rather?
Chad: Let's do it.
Joel: All right. In this corner, we have Rain. Clever name. Rain is raised $116 million funding, including $66 million in equity and $50 million in debt. Rain offers on-demand pay or earned wage access to workers, enabling them to access their pay shortly after completing a shift instead of waiting for payday. Rain service is offered for free to employers who provide it to their employees as a voluntary benefit and employees pay a small fee each time they withdraw their earned wages. The funding will be used to support expansion throughout the United States.
Joel: And in this corner, we have RiseKit. Chicago-based RiseKit has secured $4.75 million in funding. The company software allows employers to track candidates and scale their community hiring and diversity, equity and inclusion initiatives by finding untapped diverse talent through community organizations. RiseKit aims to reduce the time and cost of sourcing talent for employers while improving job seekers confidence and journey. The new funding will be used to build behavioral and skills-based machine learning models. RiseKit's vision is to help job seekers have equal access to employment opportunities regardless of their zip code. That is Rain versus RiseKit, Chad. Who'd you rather?
Chad: 2:00 AM in the bar in the morning, I look to the left, I see Rain, and I see a predatory lending by transaction, is really what's happening here. If they want this to happen, they should have the employers pay for it. You're trying to... Again, it's payday loans, but it's a transaction at a time. And so that's how I feel about Rain. RiseKit, man, I started reading about that, I'm like, "Man, this is amazing," but here's a little breakdown of leadership. First and foremost, no experience in this space. The best way I can describe the tech is that right now, it just looks like vapourware to me. And why is that? Well, I went out to go check jobs at RiseKit, I clicked on a job so I could go work at RiseKit, one of their own job postings, it sent me to a Google Form, a Google Form. Not even... Is that their tech, to a Google fucking form?
Chad: Then last but not least, behavioral assessments and AI are not necessary. They're just words to help drive more funding, which they got. I have heavy experience in building hiring communities around military veterans, and Julie, as you know, my wife, she does the same thing with individuals with disabilities, building around community-based organizations. So we know this space. Everything that I'm reading about this is counter to what actually needs to happen. So Rain is predatory, RiseKit is vapourware. Once again, it's 2:00 AM at the bar, it's closing down, and I'm not happy with my choices, I'm going home alone.
Joel: Oh, no. That's two who'd you rathers in row where you're going home empty...
Chad: I know. I really, really wanted to like one of them.
Joel: Empty-handed. Empty-handed.
Chad: Fuck.
Joel: Alright, man, you mentioned payday loans, let's talk quickly about the predatory business of payday loans. So some numbers here. On average, one in five borrowers default on their payday loans. More than half of all borrowers who got their installment loans from an online lender default on their balance. Payday lending is illegal in 12 states, and roughly 12 million Americans take out a payday loan each year. I do not, however, consider Rain a payday loan service. I view them as a take money out today, they take a small fee, not a percentage or an interest interest rate on that loan. So to me, they're almost the anti payday loan. They're fighting the payday loan system.
Joel: Employees can voluntarily sign up for this service, employers can offer this service, and money comes out of the check as opposed to waiting for it a week or two weeks from when they would get it and the money is deducted. They get less money in their paycheck because they took money out ahead of time. So for me, any company that's trying to take a bite out of the payday loan business is the one that I'm gonna pick. RiseKit seems kind of lame to me. [chuckle] You mentioned the vapourware. I just think any company that's willing to sort of take on the payday loan system for me...
SFX: What are you doing, step-bro?
Joel: That's the one that I'd rather.
Joel: Last valued at over $1 billion, Chad, Karat with a K, who calls itself the world's largest interviewing company. I don't know if there's a third party that does that or not.
Chad: That audits? Yeah.
Joel: They've acquired Triplebyte's technical assessment product and team. Financial terms of the deal were not disclosed. The acquisition will add a skills-based assessment to Karat's suite of interviewing cloud offerings, claiming to help organizations identify and hire the best tech talent faster, more accurately and fairly. The adaptive assessment technology adjusts to the skill level of each candidate, collecting more information from each question asked, enabling recruiting and engineering leaders to unlock high volume applicant pools and reduced bias. Triplebyte's sourcing business, Magnet, and its candidate, Talent Network, will wind down effective March 31st. Chad, this is 10 Karat gold, right? What are your thoughts?
Chad: Well, get ready for more of this, kids, because Triplebyte ran out of runway, and Karat was their savior. They got them on the cheap. They got them on the cheap. But I think my biggest problem with Karat's model is that it won't scale because the human interviewer element. So buying Triplebyte allows more screening before the interview, which weeds out unqualified candidates, and it eases the sheer load of human interviewing. So this is a smart move, although they need to go further down this automation rabbit hole. One question, I jumped on Karat, and I'm like, "Who the fucker is doing their marketing?" They bought a Forrester consulting study entitled The Total Economic Impact of Karat, and it's the hero image on their fucking homepage. No product. No testimonial. A Forrester study. I almost fell asleep when I opened the fucking page.
Chad: So I went to the YouTube channel looking for a video series that would break down this study, 'cause it would be more snack-able and easier for most people to want to actually understand. Nothing. You take this shit... I don't know who's doing marketing over there. You take this great information, you turn it into fucking content, videos, posts, social, all this other stuff. I gotta file just most of this under companies with unicorn valuations and rookie mistakes. Triplebyte, I think was good. They need to go further, but they are nowhere near valuable, as valuable as their valuation shows.
Joel: Yeah, with $169 million raised, you think Karat's marketing would be just a little bit sexier than what it is. This is like run-of-the-mill standard consolidation stuff. Triplebyte, $48 million raised. Founded in 2015. Runway gone. Money ran out. Time ran out. Tech layoffs are in every headline. So if you're a tech hiring service, this was all working against Triplebyte. That's when you go call the sugar daddies, and sugar daddy on the list for this one, they swipe right on Karat, and Karat also swiped right on this one. And whether it's a marriage made in heaven, I guess we'll find out. Clearly, they need some marketing help. So hopefully, Triplebyte, although the name does not really scream marketing excellence, might be able to fix the problems. To me, this is pretty much a snoozer. I guess we'll keep our eye on it and see if anything comes of it. But yeah, mostly two dinosaurs cuddling up, hoping that the meteorite doesn't Kill them off.
Chad: It feels like who'd you rather. Karat had a who'd you rather, and they went home with Triplebyte. [laughter]
Joel: Yeah, that's definitely, everyone's going home alone on that. I think that's not good for anybody. Alright, the hits keep coming, kids. After this break, we'll talk about Dice. Alright, Chad. DHI Group, what a great name, which runs tech job search website, Dice, which is a pretty good name, has reached a conciliation agreement with the US Equal Employment Opportunity Commission, or as you call it, Chad, the EE to the O to the C. They're gonna settle National Origin Discrimination charges. The EEOC had discovered that DHI violated Title 7 of the Civil Rights Act by allowing customers to post job positions that excluded Americans of national origin. Ouch! That's not good. DHI agreed to re-write its programming. They had some developers, that's good news, [chuckle] to search for potentially discriminatory keywords...
Chad: Off Upwork.
Joel: And job postings, and their job search works apparently, and revise its guidance to customers unacceptable job posting language. Chad, you're all over this one. Whatcha you got?
Chad: That's a big fucking news, dude. Notice the claimant went after Dice, and there's no mention of the companies who actually posted the job. So we talk about Section 230, which protects like Facebook and other social media companies from the impact of content posted on their networks. This smacks down that siding with Title 7, which prohibits employers, employment agencies and labor organizations from publishing an employment notice that indicates a preference or limitation based on national origin. So DHI violated Title 7 through their customer's job postings. Let that sit for a minute, kids. These jobs were likely scraped from a customer's website.
Chad: So DHI has to re-rewrite their scraping algorithm, which means everybody else needs to re-write their scraping algorithm. And think about this, all of the job boards that are out there right now that have backfill from all of these other companies, they have no clue what's on their fucking site today. This is big, because if the EEOC wants to actually start going after organizations and just targeting, for God's sakes, they don't always need to claimant, kids. They can come after you. Get your shit tight.
[music]
SFX: It's Corona time. It's Corona time right now.
Joel: Then the stock is down 30% this year. Art Zill in his clown car must go Scott Gutz will meet you at the bar because it is National Cocktail Day after all. We out.
Chad: We out.
Outro: Wow. Look at you. You made it through an entire episode of the Chad and Chase podcast, or maybe you cheated and fast forwarded to the end. Either way, there's no doubt you wish you had that time back. Viable time you could have used to buy a nutritious meal at Taco Bell, enjoy a pour of your favorite whiskey, or just watch big booty Latinas and bug fights on TikTok. No, you hung out with these two chuckleheads instead. Now go take a shower and wash off all the guilt. But save some soap, because you'll be back. Like an awful train wreck, you can't look away. And like Chad's favorite Western, you can't quit them either. We out.