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Not raising money

After much negotiation with my co-founders it has been agreed that we will not raise any external money for the initial development of the product. Instead we have agreed a small budget of around £20k for development and will focus on building the best product we can over the next 6 months.

Why do we not want to raise money?

There are many benefits of raising money from Angel investors or VCs, such as time to market, marketing power and attracting more talen. However, a number of factors meant that we wanted to keep this product to ourselves for a little while longer.

Firstly, control. Although it can be great to have an investor on your board to guide you, we want to control the direction of our company a little longer. We have a clear strategy that we now need to execute

Secondly, we’re too early. There are companies that can get funding at just the concept stage unfortunately we are probably not one of them for a number of reasons. For example, its a very competitive market with well established players, our disruption / differentiation is not around the underlying technology and we need to show traction

Thirdly, cost of development. With todays development tools, outsourced development in Eastern Europe / India it is possible to get a product developed for very little cash. Limiting our resources will also allow us to focus and prioritise our development

Our focus over the next 6-12 months will be on building a great product that solves a real problem for employers, getting them to sign up and getting their feedback

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April 7, 2010 at 2:51 pm Leave a comment

The competition is fierce

The size of the recruitment market attracts a large range of competitors, from small niche executive search firms, to internet job boards, to large software vendors.  Here are some thoughts on interesting companies in the market… most US based:

  • Linkedin – I think of it as the global online CV database and professional network map. Incredible potential to leverage its data (e.g. selling it to recruiters) as well as the audience (reach for job postings)
  • Bounty Jobs – an innovative marketplace for employers and recruiters. Increases the transparency for using recruiters but has challenges scaling as it requires a sales force
  • Broadbean – a job post distribution service that allows employers to easily post their jobs to internet job boards. Started in the UK but looking to grow in the US
  • Jobvite – a VC backed US startup leveraging social media to target candidates. Potential to really disrupt the market
  • Taleo – a large SaaS talent management solution provider. Focussed on larger enterprises

All of the above businesses are well funded and represent the range of innovation and opportunities in the recruitment market.  Sometimes I think about these guys and wonder why I bother… then I remember, they were here once.

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November 26, 2009 at 10:36 pm 1 comment

The strategy & vision Part I

Recruitment is a very competitive market and to cut through all the noise it is important to differentiate. The vision is to build a business that helps employers “find and retain the best talent, whilst saving them time and money”.  We are not looking to be another online job board or a recruitment consultancy / agency.

The development of the business has three key phases, outlined below:

  1. Customer acquisition through differentiation – offer employers an invaluable tool for them to manage their recruitment processes with the “social web” at its core
  2. Prove monetisation – help employers cost effectively source talent, optimising their spend across all recruitment channels: job boards and agencies
  3. Scale and leverage data – develop an open platform that other parties can integrate with and use the aggregated data within the platform

These phases are clearly very abstract and could probably be applied to many web businesses. The challenge is in the execution

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November 26, 2009 at 10:12 pm Leave a comment

Let’s start at beginning

I’ve been looking to do my own tech startup for a while and after some time working with startups, I’ve learnt a few things:

  • Find a big market to support a big company
  • Management TEAM is critical
  • Focus on execution and a clear route to market

Initially, when thinking about “my” startup, I was thinking about the big idea… I thought about things from dating 2.0 to e-commerce loyalty programmes.  However, I quickly learned that any idea I had there were already people (usually much better placed) thinking about it and doing it… Therefore I focussed my attention on finding the right people to work with.

With this in mind I have spent the last 12 months networking with the brightest entrepreneurs… during this time I was able to meet a very talented and visionary CTO of a reasonably successful web business. He had been incubating a web app to help SMEs manage their recruitment process – a product born out of his own frustrations managing hundreds of emails from applicants and agencies.

To cut a long story short I offered him some feedback, we built a rapport and decided it would be good to look at the opportunity together.  The ultimate conclusion being that I would help setup this business with a view to running it going forwards. The proposition has also evolved since but more on this later.

I am now a part-time CEO. Scary thought!

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November 26, 2009 at 6:29 pm Leave a comment

Why a recruitment startup?

For the record, I have never worked in recruitment and my only experience of the sector is being recruited by headhunters.  All I do know is that in the UK it is a £26bn market of which £2-300m is spent online (largely through job boards).

Other attributes of the market:

  • Very fragmented – by sector, company size, role-type (exec through to temp)
  • Large number of “people” driven processes drive inefficiencies
  • Software / technology is immature

Based on the above characteristics it is my opinion that this market is an attractive one to launch a disruptive web-based solution.

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November 26, 2009 at 6:08 pm Leave a comment


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