Advice for Employers and Recruiters

What do investors in and acquirers of job boards and recruitment marketplaces want to see? With Malcolm Myers of European Internet Ventures.

Shelby Konkel AvatarShelby Konkel
December 15, 2022

Create, manage, and work with Job Boards and Recruitment Marketplaces.

Each week, Steven Rothberg, Founder and Chief Visionary Officer of College Recruiter, and Peter M. Zollman, Founder of the AIM Group, along with guests from the world’s leading job sites, analyze news about general, niche, and aggregator job board and recruitment marketplace sites.

Today’s guest is Malcolm Myers, Founder of European Internet Ventures, an internet advisory firm focused on online classifieds and marketplaces. Malcolm joins this episode to share what investors and acquirers are currently doing in the recruitment field. He also gives advice on which job board business models are most attractive to investors and offer the most potential for future growth.

Listen to the full episode here:

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Steven (00:09):

Welcome to the Inside Job Boards and Recruitment Marketplaces podcast. I’m Stephen Rothberg, the founder of College Recruiter Job search site at College Recruiter. We believe that every student in recent grad deserves a great career.

Peter (00:23):

And I’m Peter Zollman, founding Principle of the AIM Group, the leading global business intelligence service for marketplaces and classified advertising companies. We consult with recruitment marketplaces, companies and publish AIM group, recruitment intelligence, and a free weekly digest. We also host the annual Global Rec Buzz Conference.

Steven (00:44):

This is the podcast for you to learn more about how to create, manage, and work with general niche and aggregator job boards and recruitment marketplaces. Hey, Peter, great to be with you again today.

Peter (00:58):

Thank you very much. It is good to be with you. I hope wherever you happen to be in the world is pleasant. The weather is nice, and your thunderstorms and rainstorm and whatever you went through and brighten or behind you,

Steven (01:16):

The weather is always perfect. Whatever I am, I bring it with me.

Peter (01:21):

Pardon me, while I choke, gag and otherwise <laugh> enough said when faith is with you, the weather is always lovely.

Steven (01:30):

Yes, my boss and my wife she definitely makes sure that the, that the weather is operating properly as, as well as the business. And, and maybe in that priority, the aim group stories that you’re following, what what’s really catching your interest right now?

Peter (01:47):

We’ve been looking a lot at partnerships partnerships between job boards and other job boards or recruitment marketplaces between TikTok and Indeed in Singapore for video, which is one we’re looking at closely between job boards and NGOs and government agencies in Africa. There’s still a lot that job boards can do to build their businesses through partnerships. It’s not just about we are us and we don’t work with anybody else.

Steven (02:17):

Yeah, I think the, that, I’m gonna be very interested to read that in, in the report that I, that I get from the AIM group because partnerships really allow you to magnify your presence. We don’t, there’s, we, we don’t believe at College Recruiter that we should be doing everything internally that, you know, that we’ll build by partner. If if somebody’s a lot better at something that is tangential to our business, then I think a partnership is really the way to go. Are you seeing that across geographic lines, industry lines? Where, where are you seeing that?

Peter (02:55):

What struck me the most when we were at rec Buzz in Amsterdam a little while back was Diane Mullen of Rome, Africa, which has Jobberman and Brighter MUN was talking about working with NGOs and government agencies, and we’ve seen a lot of that, but we’ve only seen it in, you know, a little brief here and a little brief there, and we really haven’t focused on it. And it makes a ton of sense to not just be a standalone, do your own thing, job board. Many work with associations, or many are owned or operated by associations, but partnerships make a ton of sense, especially when you can add one plus one and get three. Doesn’t always work that way. And they can be headaches, but they can also make a ton of sense. And I think some recruitment marketplaces are just way too quick to dismiss, oh, we could never do that. Oh, we don’t wanna do that, or whatever.

Steven (04:03):

For, for those who don’t know about, about Rome, Africa, r o a m Africa fascinating, amazing work that they’re doing well, we should probably bring in today’s guest. Malcolm Myers is the founder and CEO of European Internet Ventures. Malcolm is a very well known marketplace advisor, and he probably doesn’t want me dating him, but he’s spent the past 15 or so years working with founders, which means he’s at least 20 to raise capital or sometimes to sell their marketplaces around the world. Malcolm, for people who don’t know a lot about you, other than my little Twitter bio of you what else, what else do they know about you?

Malcolm (04:49):

So I’ve been in this space for 15 years, as you correctly say. I actually used to run m and a at Naspers, which has been a big player in the classified space. And I’ve been running my own advisory business for about a decade as you correctly said, doing m and a and capital raising in what I call online marketplaces. And within that broader area jobs and what I would call jobs classified. So a lot of you guys would call jobs boards has been an important, important vertical within that, that overall classified some marketplaces, remit,

Steven (05:24):

So also marketplaces that deal with autos, real estate, et cetera, right? Not just exclusively the, the job and recruitment space.

Malcolm (05:32):

You’re right, Steven. And, and that’s what makes it even more interesting, because there are many things which the different verticals, as I call them, car real estate or jobs have in common. And then when they don’t have those things in common, it’s also very instructive to try and understand why, why might one of these verticals be different from another? And although the company’s called European Internet Ventures, I’ve have experience working in every, every continent of the, the world. And so also you have those, those regional differences as well, which help to, to play out and make this space even more interesting.

Peter (06:04):

Investors, what do they wanna do in the recruitment field right

Malcolm (06:08):

Now? So I think right now is, is, is a, is a very precise point in time. I think if we look at historically if we look at the past three years, for example, history sounds a long, a long way back, but we look at the past three years you know, there’s been more than 20 billion invested in this space by PE and VCs. And you know, that’s, that’s, that, that means that whoever’s listening to this podcast is in a space which has attracted a lot of capital. And when, when you analyze based upon, say, pitch book data what’s the trend being for the first six months of this year? Well, funding is still up compared to the first six months of 2019 or 2020. So there’s still a, has been until now at least a very substantial and he amount of, of private capital coming into the recruitment space.


And when you, when you look at how that splits out it’s very interesting to see that. The biggest chunk of all this, it’s about a 20 billion, as I said, roughly a third of that has been PE funds investing into these later stage platforms. And I’m talking about specifically recruitment and staffing platforms like house of HR or ADCO or Hayes. So that’s one chunk that has attracted a lot of late stage capital, in particular debt capital. And then perhaps one of my, the most exciting areas has been what I call vertical marketplaces. Vertical marketplaces have also received about 5 billion in capital over the same time. And for me, a vertical marketplace is really a platform that’s focusing on, on employers from a very specific area like it, or it could be it could be catering and, and, and, and retail blue collar style work.


And these, these verticals can create a lot more value than a simple job board because their model is not just to charge a monthly fee or a click through rate but it is really to, to charge a share of, of the total payroll paid and in return, they seem to be getting very, very good at identifying exactly what kinds of candidates fit best for their employer customers in a, in a way, which is a level of detail, one higher than the traditional staffing firms would’ve done if you go back at 10, 20 years. So that area is really interesting. And then there’s also some more, let’s call the more software-centric areas, which the VCs have been very excited about. The ATS has, has been a very, very strong theme. And companies likeon raising almost half a billion dollars in the time period I’ve referred to is one very interesting area.


And then one other is, is, is background checking. It might sound like it’s pretty niche, it’s not. There was one and a half billion dollars invested into background checking. Obviously very automated, very software driven, very data driven companies like checker raising 250 million, for example. And then one of the other areas I, I’m really excited about is, is what I call sourcing boosters. So these are, these are companies which are very good at bringing often passive candidates to companies like job sports. One sourcing booster I like is, is Eightfold AI who raised 220 million over this time period. And they’re very good at sort of looking into the ATS of any company and seeing whether there are profiles there that could be relevant for current current hiring needs. And then finally, the sort of, the, sort of the runners up are the the sort of the testing, screening, interviewing style businesses, which I think will also play an increasingly important role.


Companies like Carat, K A R A T in the, in the it in the it testing and interviewing area, for example would be a good example of that. And, and maybe just a final thought on, on this, on this question. The classic job boards have not been a source of, of funding over the past few years. That’s interesting in itself. Maybe it’s because most of the players are already there and already generating cash, but that’s simply not been an area which investors have been focusing on.

Steven (10:41):

We’ll be back right after this break. Welcome back to the inside job boards and Recruitment Marketplaces podcast.


I think by some estimates there are at least tens of thousands, perhaps a hundred thousand different job boards, recruitment marketplaces around the world. You obviously talked about some kinds of business models that definitely aren’t job boards, recruitment marketplaces like Preso, for example. But you know, if you were advising an investor or somebody who was looking to start a new business, where, where would you tell them to, to put their money? Like what’s the, what’s the, what’s the greatest potential do you think, in the next two, three years in the online recruitment space?

Malcolm (11:35):

That’s a great question. I, I think that what’s interesting is how technology is making that task of sourcing candidates and matching them to jobs work better. And I think for those, those tens of thousands of boards, understanding how technology can add value to what they’ve been doing is really important. And that’s both important for the jobs boards, and it’s also a very interesting potential investment opportunity for VCs. And again, picking up from, from my comments to the previous question, it’s about jobs, job boards, understanding the role of sourcing boosters, how I can either use programmatic or some other ways of bringing passive candidates to my job board. I think that’s a really interesting space. It’s less developed in Europe than it is in the US and in both continents. It has a long way to go. And then this, the ability to, to add value to those passive candidates through testing them through engaging them through using bots and, and other formats to, to really see are they possibly interested in, in, in, in a specific opportunity.


And trying to get a little bit more relevant information to, to make that lead ever more valuable as you move down the funnel. I think businesses like that have a huge amount of benefit to bring. And then of course we all talk about, you know, ai, and we don’t really ever mean the same thing when we talk about it, but the ability to have a level of intelligence that enables a job board to match the candidates, which it’s getting with the positions it’s advertising, this will be, in my view absolutely critical. And that could be anything as simple as, you know, the ability to break a specific role into maybe five key key areas of, of, of expertise or, or five key things which that applicant needs to have done. And then ranking those applicants based upon how many fits, you know, or five boxes or, or four or three.


And that ability to stack rank applications in my view, again, can create a huge amount of value. One, one of the biggest problems today with job boards is when you have basically no constraints on how many applicants can apply or what kind of applicant can, can apply for a particular role that often ends up destroying value. You know, the, the recruiter ideally would just like to have one perfectly qualified candidate come through and not have hundreds who may only only tick one, two or or three of the boxes. So I think, I think companies which are good at linking together these different value creating tasks will create a lot of value and I think will also remain very popular for investors. So either the enabling companies who are doing this or the jobs that’s able to bring it all together into a, a more value added overall service, I think those companies will, will also be of interest.

Peter (14:52):

So from an investment and a for sale perspective, a job board has to be a lot more than a job board and needs to incorporate some, many, most all of those elements to be attractive for sale or attractive to investors.

Malcolm (15:14):

I think that’s exactly right. Peter, I think you know, when we look at other classified verticals, you have companies like right, move in the UK or or, or, or Autotrader in the UK that are so dominant. If anybody’s interested in a car, 90% of the whole I venture will be on autotrade or 90% of all homes will be on right move in the job space. That’s just not the case. And even the most successful what you guys still call job boards around like StepStone in, in Germany, they’re very, very strong. And you know, the monetization is very impressive but they’re very strong only in an increasingly narrow set of white collar you know, positions. And they don’t have that overall hold of the market in the same way in Germany, the top car or, or real estate portal does. So I think given that you don’t have that sort of natural network effect working in anything like the same level, you don’t have that same capture of traffic andry in jobs as you do in car and real estate, therefore you have to create value in a different way.

Peter (16:29):

Speaking of StepStone, by the way, rumor has it, the AIM group has reported it that Axle Springer, which is a parent company, is working on an ipo of course, with today’s economic environment, who the heck knows when they will get that I p out the door? But we certainly have heard about it and have reported on the rumors, if that, if that were to take, if you were to give a job board or recruitment marketplace operator, one piece of advice for finding investment or if he slash she wants to sell the company, what can they do, especially in these somewhat crazy economic times, high employment than most markets recession? Maybe, maybe not, et cetera. What’s the one piece of advice?

Malcolm (17:25):

I’m not sure one piece of advice will be enough <laugh>, but, but there are a number of things I would focus on. The first is monetization. I don’t think that pay to post is usually very effective in extracting all the value there is on a jobs board. One of the best cases is if, if the, the clients or the employer wants 20 call center agents and they only have to pay for one call center ad they’re getting rather good value for money in the way that wouldn’t be the case if it was a paper click or paper application or, or, or other formats. So I think the first thing I would say is make sure you have your monetization model truly optimized. I, I would then add that cyclicality is, is is an interesting one, you know, when is the right time to sell a job sport?


At the moment, as you said, we have a a at the moment we’re suffering from a shortage of, of candidates or people proactively looking for work. And there have been times, if we go back to the global financial crisis 2009, where you had a lot of people looking for work for which there wasn’t an employer, but, but most of the time there is an ability to monetize what job boards are doing as long as they are good at, you know, at the moment it’s about being very good at sourcing passive candidates. And in the future it might be about being better at, at, at matching amazing candidates who’ve become redundant to employers who would probably want them even if they’re not proactively seeking. So I think playing on, on, on the passiveness, whether it’s candidates in the current market or whether it’s passive employers where there’s higher unemployment, these are also terrific skill sets which the smartest job boards are beginning to develop.

Steven (19:27):

That makes a ton of sense. Thank Thank you Malcolm. So quick question before we leave off, and that is for the job boards and recruitment marketplaces that, that are listening to the podcast, do you feel that their businesses, the industry is, is dying, is it headed for extinction or are we in a period where evolution or maybe even revolution is, is necessary?

Malcolm (19:52):

Terrific question. So I I think they’re parallels from, from, from other, other verticals which we can consider. And in particular, I would, I would look at the difference between a traditional adson classified site that’s just selling ads versus a site which is taking care of really screening through buyers and sellers. And I think think of cars, for example, the difference between a car site that just lists ads of cars for sale, where you don’t know whether the the seller really owns the car, you don’t know how long they’ve owned it for, you don’t know what condition it’s in, you don’t have price guidance and then the seller doesn’t know whether the buyer is legit, whether the buyer is trustworthy et cetera, et cetera, et cetera. So there’s a, the marketplace is failing to eliminate traditional friction. And as a result you can’t monetize that site nearly as well as one where if you imagine, well, yes, the marketplace is going to vet the seller, they’re going to have to make sure the car is inspected so you know exactly what it is, they’re gonna give price guidance to show where the price of that car fits within the range of other transactions.


The platform’s going to guarantee the payment through an escrow service and so on and so on. You can, ima imagine how when you add that additional value and take away that additional marketplace friction, you can end up monetizing it much better. And I think the same will apply in the world of job boards. A little along the lines, which we were discussing earlier. You know, and it’s a little bit, when you move from a simple this in, in the world of job boards, I think it’s closer to comparing a classic listings only business with some of the deeper marketplaces. We see, for example, a job and talent where you are much close to this second model where, you know, in the job and talent model, they’re getting much better at under that they’re very focused, first of all, they know exactly in their blue collar segment area the types of candidates which their employers are looking for.


They’re able to vet them, they learn about them, they use that information from, from surveys and from previous hires to enrich the value of the listing. Or, and, and it, it simply means that they can place candidates with much more certainty of success. And at the same time, the employers they’re working with, they can get to understand their needs better and better. It’s, and I think it’s that, I think it’s that ability to, to deepen the service layer both on the, on the candidate side and the employer side, which will ultimately end up delivering value. And I think that those job boards which are able to go deeper into the verticals in this way are the ones who will not only survive, but thrive.

Steven (22:40):

Awesome. Well, Malcolm, thank you so much for joining us today. For listeners who wanna learn more about European internet ventures or Malcolm Myers or having a home in Switzerland how should they reach out to you?

Malcolm (22:55):

So I am I’m very active on LinkedIn and there’s also a website european internet, so be very happy to connect with anyone who’s listened to the podcast.

Steven (23:05):

Brilliant. Thank you so much, Peter. Any last words?

Peter (23:08):

Chris? Thank you very much. Malcolm always speaks at our conferences and is always one of the highest rated speakers, and now you know why. Perfect.

Steven (23:16):

Thank you. Thank you much.

Malcolm (23:17):

Thank you guys.

Peter (23:21):

Inside job boards and recruitment marketplaces is a co-production of Evergreen Podcasts College recruiter and the AIM Group.

Steven (23:30):

Please subscribe for free on your favorite app, review it five stars are always nice, and recommend it to a couple of people you know who wanna learn more about job boards and recruitment marketplaces.

Peter (23:41):

Special thanks to our producer and engineer, Ian Douglas. I’m your host, Peter Oman of the AIM Group, the leading global consultancy in the field of marketplaces and classified advertising. Find out more about our reports on recruitment marketplaces, job boards and classifieds, including our new recruitment marketplaces annual at aim

Steven (24:07):

I’m your host Steven Rothberg of job search site college recruiter. Each year we help more than 12 million candidates find great new jobs. Our customers are primarily Fortune 1000 companies, government agencies, and other employers who hire at scale and advertise their jobs with us. You can reach

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