SmartRecruiters Unplugged with Interim CEO Rebecca Carr

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[00:01:51] Welcome to the chat and cheese podcast. I'm your co-host, Joel Cheeseman. Join us always, Chad Sewash. And we are excited to welcome Rebecca Carr, Chief Product Officer and Acting CEO at Smart Recruiters. Rebecca, you're welcome. Welcome to the chat and cheese podcast. I'm your co-host, Joel Cheeseman.

[00:02:09] Welcome to the chat and cheese podcast. I'm your co-host, Joel Cheeseman. Welcome to the chat and cheese podcast. I'm your co-host, Joel Cheeseman. Welcome to the chat and cheese podcast. And we're excited to welcome Rebecca Carr, Chief Product Officer and Acting CEO at Smart Recruiters.

[00:02:25] Rebecca, welcome to HR's Most Dangerous podcast. Thank you for having me. She's very pensive. She's like, what am I doing here? This is a fun part of it. Who do I need to fire for this one? Who do I need to fire for this one?

[00:02:36] This is going to be the easiest part of your day, I promise. So, Rebecca, a lot of our listeners don't know who you are. Love Products, Tech Nerd, Ben and HR, way too long. But haven't we all? Amen. Yeah. My whole career was a recruiter, turned product manager.

[00:02:53] Actually in there, by the way, I built Facebook games. Fun story. Okay, you want to hear about that. Hold on. You can hear about that. But business stuff. My first question is going to rock it. So keep talking about your personal stuff. Mama too. Love Pilates. Love Pilates.

[00:03:10] You know, you got it with this industry. Joel loves Pilates too. We're talking teams. We're talking toddlers. We're talking out of the house. We're talking a five year old and a three year old. Oh my God. And you're a CEO. And CPO. I have a great husband.

[00:03:23] Do you sleep? Good God. I do, thankfully, because I moved to the East Coast recently. Nice. And prior to that, I was living in California and operating a European company. And that took a lot out of me. I could imagine. I would say, yeah.

[00:03:37] But now I'm on the East Coast and I have balance and I do kid drop off. And then I don't see them for the rest of the day. That sounds like utopia. All right. I had a jaw drop moment when I was doing some research on you.

[00:03:49] You did research on me. This is going to be fun. You talked about being a long time veteran as are we. You spent time at branch out. Oh, we're going back. That's where we're going. Please. That's where we're going. I love this. This is great.

[00:04:04] I was begging for interviews with branch out back in the day. You were? I didn't want to give you one. Oh, my God. Rick didn't want to give you an interview. They would only talk to TechCrunch or like CNBC. You mean the five minutes that they were alive?

[00:04:19] Talk about what the company did and the epic flame out after the Facebook changes, I guess, for lack of a better word. Talk about your branch out experience. Yeah. Us and identified, we tried hard on that one. You remember them? Oh, yeah.

[00:04:37] Which ironically, Charlie Nelson came over from my identified to smart recruiters and then I came over from jobite to smart recruiters. So we competed again, but in a different context. But anyway, branch out. It was essentially an app within Facebook that was attempting to create a...

[00:04:52] Bring jobs, spam and network. Well, I'll tell you, that was my... No, but it was... Those spoilers. Attempting to compete with LinkedIn. Yeah. Basically, they wanted to have like a professional profile that was in parallel to your Facebook profile. They raised how much money? Oh.

[00:05:09] At the time it was huge. Now it's like Tuesday. It was like a mere 100 million or something like that at the time. Yeah. There was a lot of issues there, but it was an interesting idea actually which was if people are spending a lot of time

[00:05:21] on Facebook, why not bring them jobs? Sure. If there was like an app that felt a bit protected where you could build a profile that was professional and you could share that and apply to jobs, then you could do it all in one experience.

[00:05:35] And in the back end, there was actually essentially like an early CRM that then we sold to big companies, some of whom are at the show. They used to source people on Facebook. Yeah. And so I ran product. Well, okay.

[00:05:50] So I mean, I think that was one of the very first things that we found out in the space that we found out that you couldn't lean too hard on a big platform like with Google's Panda and how that screwed so much SEO

[00:06:03] and this obviously with branch out and then also Be Known. Monster had Be Known. Be Known. Yeah, yeah, yeah. Be Known same time. Sharecropping is a dangerous business for sure. Yeah. Well, the biggest challenge was one, getting people to actually like get out of, I'm in Facebook mode.

[00:06:19] This is like where I'm sharing pictures of my dog and kids. And that's not easy. It is hard. Because you have safe spaces and then you have professional spaces, right? Exactly. And regardless of if it's like an app, people still didn't trust that there wasn't some visibility

[00:06:33] into their personal life. The data was extremely unclean at the time. So this was back in the day when you entered in your location on Facebook. It was like, I live in SF or San Fran or San Francisco. So like the normalization of like every single data element.

[00:06:48] This didn't happen. Hard. So they identified, did it right actually in the beginning. They said, you know what? We're going to focus on like one job profile, nurses because they're on Facebook and they're not on LinkedIn. And we're just going to focus on normalizing all the healthcare

[00:07:02] data that we can possibly get. And they were more successful. Branch out just went a little too broad there and we played that whole like, who would you rather work with? They branched out a little too far. Get it? So let's talk about that a little bit

[00:07:14] because I mean, there's just so many learnings for current startups. For most don't lean too hard on a big brand that could fuck you. Number one, number two, being able to spread the Tam that quick just doesn't make sense. And we see obviously many companies

[00:07:29] that are here today who spread the Tam too quick. So I mean, what do we have to do to learn from history? Because we just keep repeating it. Yeah. Arguably smart recruiters did something similar to mean we brought an ATS to market

[00:07:43] from a free product probably could have focused a little bit more on the industry and the segment we wanted to serve. We went overseas extremely quickly which actually has ended up benefiting coming to our benefit. But as a product leader,

[00:07:57] it's probably one of the hardest things you do. You get a couple big customers right in the beginning that pull you in one direction versus another. You want to make them happy because you need them to reference you. But none of them are like each other.

[00:08:10] Which take you all over the place. Takes you all over the place. It's hard to pick one because there's a lot of risk in that. So we're operating on, especially as a startup, a limited amount of capital. But let's talk about discipline at that point.

[00:08:21] You have limited amount of capital. But I mean it's incredibly important to be disciplined right out of the gate. So I mean, you guys, you didn't but then you reined it back in. We reined it back in. So talk a little bit about that journey.

[00:08:35] Well, I think what we realized was it's important to have an ICP. No. Lesson for the kids. If you'd like some money. I mean, it is, I think for us, it was about one identifying a segment we wanted to play in.

[00:08:52] Like the unit economics of acquiring an SMB versus an enterprise are wildly different, not just at the industry level, but like the country level very, very different. And understanding and unpacking that data is step one. I think we were moving so quickly

[00:09:07] because we were seeing so much inbound. We were just reacting and like actually putting some data around everything that you do and studying it and spending time studying it. Very important. There were things that came out of that analysis that actually shocked us.

[00:09:23] We have massive, massive software and technology brands that use the smart recruiters platform. But when you look at things like market growth over the next couple years, total ticket volume, where they're struggling, where there's the most overlap in product strategy,

[00:09:36] we still see a lot of success in software and tech, but not as much as we do in retail and hospitality. Both are doing theoretically high velocity hiring because tons of people are applying to these big tech brands, tons of people have to apply to retail,

[00:09:50] but actually the level of depth that you need to go on any one feature is wildly different. And figuring out how to balance that successfully is something we've had to do by changing how we structure our engineering teams and the types of resources and dollar allocation

[00:10:04] we put toward each of them. You can't create one product that covers them all. I can't be something for everyone, that's for sure. And frankly it's a strategy that we've only recently started to embrace with embedded partners. And we're not the only ones, Workday

[00:10:18] starting to branch out a little bit more. You heard of them? Yeah, but I'm not going to be the best people analytics platform on the earth. If Vizier wants to white label under the scenes, great. Now I don't have to have engineers there.

[00:10:33] I can rely on an actual best of breed platform there. They're willing to white label. The commercials look good for everybody, including our customers. Well that's their expertise too. Yeah, exactly. And they'll continue to innovate there instead of me innovating now on that

[00:10:49] and then innovating again in four years. Like it's, but that's what I would have to do in order to serve everybody. That's the general product cycle for a core platform though, right? When you come up with like a new quote-unquote product which is really just a feature,

[00:11:01] it goes out, everybody's like, and then four years later it's like, oh, we should probably update that. We should go back to that. Yeah, I mean the market's moving fast enough. We should. Talk about how you're looking at, I guess sort of the economy as a whole.

[00:11:14] You guys like head count wise from what I can tell the last couple years have stayed pretty constant. You haven't had the big layoffs. You haven't had like a major earthquake in terms of head count. No. What has been the strategy

[00:11:27] and how has the bigger economy at large or the marketplace at large directed that? Yeah. I mean we've seen a little bit of a reduction a couple, two years ago or so. We're on the same time a lot of other people

[00:11:40] started doing it but mostly because we divested in certain product areas that we didn't need anymore. Not like your traditional RIF. I think what the refinement of the ICP helped us was right at that moment that we actually said, you know what, we're doing way too much

[00:11:55] and if we actually focus our dollars we're gonna see short-term growth in the segments that we already know we have great product market fit. If we put all our product and engineering resource there we're driving good impact but we were, frankly our business strategy has always been to

[00:12:11] near shore so to speak a lot of our R&D. So our R&D team's actually grown dramatically and continues to grow but in a lower cost market and very high tenure. I'm like proud to say our engineering team is, I think our average tenure is 4.9 years,

[00:12:28] something like that. Pretty good. So there's lots of context, subject matter expertise in a market. We've got over 200 engineers now that are working on that on a company of 500. That's actually a pretty good allocation. So you've pulled back a little bit on sales people.

[00:12:44] Is that a response to less market demand? Are you more efficient around sales? Talk about that decision. Different GTM. Yeah. I think we've... Year of efficiency? Yeah, I mean year of efficiency but like... They're leading the witness. I'm helpful like that.

[00:13:01] Well, I mean you can get into the details of net magic number and all the things that our investors actually want to see. Branch out. I mean the reality is if you play in the enterprise space, you grab a lot of enterprise deals.

[00:13:15] Those are one deal, one core team. You don't need the same volume of reps you might need in like a mid-market play. And if we've got good hunters that know our business and have been with us for a long time, our European team, very high tenure reps.

[00:13:30] They've built good relationships in the market. We did a lot of great account-based marketing. You can do it pretty efficiently. You just need to win them. And you need to win them with good products. So we've invested a lot more in R&D

[00:13:43] to have the good product to drive up our win rates which are good. Yeah, even increased service. So servicing those accounts, you've invested on that end it looks like. Yeah, I mean we've invested in good partners there too. We outsource a good piece of our professional services group

[00:13:59] to the AMS's of the world, the CLO's of the world, that sort of thing. Frankly, that revenue, we're a tech company. It's not interesting. And it might be positive margin, but what's it really doing other than just you're holding costs that you don't really need?

[00:14:14] And especially if it starts branching out and those resources start doing more like traditional customer success, then you have direct impact on your net magic number. So we've started to outsource a little bit more. We're going to continue to do that.

[00:14:26] But yeah, we've invested a lot in retaining our customers and not having a leaky bucket turns out it helps. Hell yeah. It's easier to keep. It's a lot easier to keep going up. A customer than to acquire a new one. So you've been talking about products.

[00:14:42] I had an acquisition of JobPowell. How does that actually, how's that bled into if yes or no into the actual product itself? Joel talking about, you know, year of efficiency. Talk about tech efficiency. How has that helped? Where has it helped? Specifically JobPowell.

[00:14:59] We turned into a product called SmartPowell. We've seen some growth there, but frankly a lot of the acquisitions that we've made, it's expensive and costly to integrate new tech into your stack. There's a lot of enhancements that need to be made.

[00:15:13] Our big sort of big relaunch of the original JobPowell stack with a lot more is what we're working on this year actually. Okay. Okay, listener, how can you help your employees become more productive? I have answers. How about automating manual and repetitive tasks, giving meaning to data,

[00:15:34] then allowing that data to actually drive decisions? And how about matching people to your jobs quicker? Well, wait, the Chad and Cheese has a new LLM? No, Cheeseman. I'm talking about Tex-Colonel. Ah, okay. That makes more sense. What I'm hearing is the groundbreaking concept of,

[00:15:55] wait for it, simplicity. Seriously though, seriously. Tex-Colonel cuts through the complexities like a tortilla chip through some hot nacho cheese. Oh my God. Really? Nacho references already. Anyways, Tex-Colonel brings efficiency and productivity to your operations. Tex-Colonel seamlessly unifies your tools and data to drive efficiencies and success.

[00:16:21] Tex-Colonel is creating new opportunities for your recruitment journey, kind of like adding guac to my barbacoa burrito. Oh my God. How about extracting meaningful insights from data? I mean, that's something. Swiftly matching people with jobs, automating repetitive tasks. Who knew such advanced concepts were even possible

[00:16:45] in the land of human resources? We did, Chad. We did. Dude, wrap it up. I'm a little hungry. Imagine that. Okay, listener, get ready to use today's tech to drive efficiencies and productivity. Visit Tex-Colonel.com. That's T-E-X-T-K-E-R-N-E-L.com. Mmm. Nachos. But, yeah, it's...

[00:17:16] Acquisition in most of the areas of our space would not be my first go-to these days. I mean, there's good products out there, good point solutions, but integrating the people, retaining those people, aligning those customers to your core stack, not the most efficient experience in the world

[00:17:36] or motion. And so for JobPal in particular, it's been, I'd say, could have been more successful than it was. But we're getting there. We're sort of rewriting it. So let's talk about smart recruiters and then obviously talk about where we're at today and moving forward.

[00:17:53] So smart recruiters, literally, and we saw this out of a lot of the core platforms, the greenhouses and whatnot that came a little bit later, a little bit fashion-forward, a little cooler than some of the older platforms. But yet they were still predicated

[00:18:06] on the process methodologies of the old world recruiting. We're seeing new breed. New breed. New breed that's coming out. How in the hell are you guys going to compete with that? Because it's going to be faster. Are you putting paradox and fountain in that bucket of new competitors?

[00:18:21] Yeah, yeah, yeah. I would definitely say that. So how can you actually keep up with that in today's, I mean, because Moore's Law is even speeding faster. GPUs are just killing this game. I mean, how are you going to do that? Well, one thing.

[00:18:36] We need to get out of this hole. I have to own the user experience of everything mindset. I mean, we all sort of went and did it from a product person, by the way. That's revolutionary. Well, I mean, the reality is we serve in recruiting.

[00:18:52] A recruiter might be our core persona, but the reality is most of our users are not recruiters. They're employees, they're hiring managers, they're interviews, they're people that don't care about recruiting until it's time. And the last thing they want to do is log into my ATS.

[00:19:06] I mean, I fought that battle for a long time. Like, well, what if it's more beautiful? No. But that was really what it was mainly predicated on for many of the newer applicant tracking systems is just that it's more sexy.

[00:19:20] We've got rounded corners as opposed to squared corners. We might have some more like, it's prettier colors, a little bit easier on the eye, bigger buttons. So how do you keep up with the new breed? You open yourself aggressively.

[00:19:33] I mean, if I could make smart recruiters fully API-able tomorrow, I would. And I'm on that journey. I mean, for a long time we led the way and we were maybe 30, 40% open to a public API. This year, hope is to get to more like 80, 85.

[00:19:51] To my point on, we can't serve everybody. We can in a world where there's more movement toward gig and fractional work, which means more kind of custom, more personalized experiences. They don't want to build the back office because that's really expensive.

[00:20:06] But if they can control the UI and I can give them a design system, not just APIs, but like components that they can plug and play to build that experience, then I can meet a lot more people where they need to be candidates and hiring managers alike.

[00:20:21] But do you do that? Because that sounds very complex for the normal like HR slash. We rolled out our first version of our design system back in January. Great feedback from partners. You're testing it with the Visiers and the hired scores of the world. Nice. Yeah.

[00:20:39] Nice little tie into work day there. That was nice. I try. Great product. But it needs to just be a part of who we are. And for a long time, we held control over wanting to be even for integrated partners, their experience,

[00:20:53] just like everybody, we're going to be agnostic. Everybody's going to look the same. We're going to control what that UI looks like. We just can't anymore. And so I think opening up that experience and making it easy to plug and play point solutions.

[00:21:05] So like app like experiences for integration, not these like $100,000 custom middleware connector thing of a mobs. Tech is better than that. Like frankly, all of the other industries that surround us from you know, Mar-Tech to FinTech are doing this.

[00:21:23] They have API first products that are successful in the market. For a very long time. Yes. Like we can get there and we have to. We're going to be forced to do that as work evolves. Well, the work days, the bigger core platforms have

[00:21:37] to be forced into that before anybody else can because other ones that really rule the world. So I mean it's hard to force that, is it not? Yes. They will play a big role, but they are too certain.

[00:21:49] I mean this is, I mean David Summers has come out and been very vocal about the fact that they need to open their ecosystem. And frankly, they have been evolving to a certain extent. Remember when Workday Studio was like it? Yeah.

[00:22:02] Like now they do have APIs and they have started to share more and they have been open to partnerships with companies that might directly compete with them in one area versus another if it serves a different purpose, ICP.

[00:22:17] And that kind of collaboration is I think going to make us all better because it's going to force us to come to the table and just frankly have better infrastructure. In 2021 you guys raised $110 million. We did. Evaluation of, oh that's a lot of money. $1.5 billion.

[00:22:35] Obviously talk of IPO surrounded you as well as your brethren in Greenhouse and ICIMS. I'm sure you're tired of talking about the IPO question but give us a current state of affairs with going public. Is there someone IPOing right now? Yeah. Is it a waiting game?

[00:22:51] Is it like what is, is it a holding pattern? Certainly there has to be some sort of a liquidation event when you raise that kind of money. I mean sure. I think you raise that kind of money. There's expectations from investors. That's natural.

[00:23:03] It's a horrible time to IPO. We're certainly not having that conversation. Do I think that there's going to be a lot of market consolidation? Yes. Do I think that acquisitions like Hired Score by Workday or a Domino that's going to fall, like tip the market? Yes I do.

[00:23:20] Okay. That's normal. That's what you expect in recessions like this. Does smart recruiters come up in conversations around the world? Of course. This is actually a moment when most of the vendors on this floor get the most phone calls.

[00:23:35] It's a question of who they are, can they pay, the price that they need to pay. Is there a good cultural and product fit that's actually going to be the right strategic decision for the buyer? Yes. I think there's a couple options there on the table that

[00:23:52] could exist for many of us. The elephant in the room, which Joel just totally passed over, is the botched acquisition that we talked about. As we know and you don't have to validate or confirm, that was with Isems. Okay. A little head nod. That's okay.

[00:24:09] Don't do that to her. I said, okay. If that's what you think. I think it might have been a shrug. I'm sorry. Like maybe. I will pull back. Anyway. So I mean that would have been a liquidation event.

[00:24:23] Somebody told me the other day that I was being that B. Marie and us were going to merge. That was another one that's been flying around. That would be the dumbest thing anybody could ever do. But I tell you the amount of rumor that exists in this

[00:24:36] space though is exceptional. Yeah. It's like giving a cat a bath. But this one's not a rumor. So when we're talking about liquidation events, I mean you guys and I mean many of the unicorns slash unicorns are out there looking for at least partners. Yeah.

[00:24:56] To the very least. So talk about that IPO I think is not even a conversation today. Not for any of us. I mean, but great acquisitions start with great partnerships. Period. And we're in a moment as I mentioned where we're starting to

[00:25:12] look at a lot of embedded partnerships across the industry. And some of them are going to take off and they're going to be great and there's going to be a natural moment there. And we are very good about sort of picking the partners that

[00:25:25] are going to match our customers that are going to that are going to serve them good value that are going to be great tech collaborations. And if some of them work out, I'm sure I'll have that conversation and I'd be stupid not to

[00:25:38] frankly given where the moment is. But when that moment comes, it will come and it hasn't come yet for smart recruiters. So are you struggling to attract the talent you need today? Do you lack visibility into where your recruitment ad dollars are really going? There's a better way.

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[00:26:31] Visit us at AcquireROI.com and start transforming your talent acquisition today. So you've had your crystal ball out a little bit. You've talked about API focus. You've talked about consolidation. Take out the crystal ball on smart recruiters.

[00:26:45] What do things look like at the company in say two, three years? I think it's a hard one to answer. It depends on where we see growth I'd say in the next six months as a leading European ATS.

[00:26:59] We offer something that a lot of multinationals haven't been able to get from best of breed. We could grow if we continue to double down in some of those markets and still be a key player in your Amia for sure. Amia. Yeah.

[00:27:14] I mean, that's where now more than half of our revenue comes from and we're seeing a lot of growth in APAC. There's a lot of point solutions that serve a single country. Yes. But when you start crossing borders there aren't a lot of best of breed solutions.

[00:27:28] That sucks. That's hard. It's hard. That's hard work. It's extremely hard and there's been a lot of North American players that have tried it and failed. Yes. And I actually think the fact that we're successful there makes us very attractive to a lot of big North American

[00:27:45] companies as a partner, just a tech partner or a strategic partner long term. Right. And so I think you're going to see some growth from us overseas. That's where we've invested a lot. I think that that could service really well from a partner

[00:27:59] perspective and might be an interesting carrot for someone. But it's my crystal ball is we'll see. I mean, we'll see. That's the only way to go to Europe is to acquire a successful company. Except if you were us for some reason or you have a

[00:28:15] French founder like me. I was going to say, okay, so that being said, the great segue. So Jerome was very hands on. An amazing dude. The founder. A very aesthetic dude. Sure. Loving dude. Is he kind of like a guy?

[00:28:30] He's kind of like your go to guy now. I know he's chairman. Yeah, he's chairman. Yeah. Is he like a go to guy still free? Because you've been at smart recruiters for a while. You left and you came back. I did. Right.

[00:28:43] So tell me about that because that's an interesting relationship. Yeah. Well, I remember the first time I met Jerome. My employee number is 19. Me too. Yeah. It was back in 2014. He's a visionary. He's he is. He loves this space.

[00:28:57] He has a passion for the problem and I do too. I left because I needed to see how another company ticked. I think that's background company background checks. Another unicorn that she just another founder led French founder led. Yeah. Wee wee. Wow.

[00:29:18] Somebody has a profile, but he has a type. No, but I actually at checker. I worked in their incubator group building adjacent products to background check and I did a they're a payroll product. So it was cool. Nice. Good experience came back because I really missed recruiting tech.

[00:29:34] Like it's just what I know and what I love and there's a lot of problems to be solved here. Yes. Jerome is absolutely still involved, still has a big vision, great like support system and mentor for me. But it's a I still have all the other board members

[00:29:50] that are operational. I'm sure you know. No, I mean he's he's very supportive of the vision and the focus that we've provided this company very excited about some of the partnerships that we're pursuing and still a big contributor to the conversation for sure.

[00:30:08] That is Rebecca Carr everybody, CPO and CEO. Man, I could talk for hours. There we go. Woman. I know. I know there are some listeners out there that want to know more about smart recruiters. Where would you send them? Smart recruiters dot com. Love it.

[00:30:25] And I don't think we said AI once in that whole interview. Did we not? But we said branch out about 28 times. All I got to say is I hope that soon they take the interim off. And we can just have the CEO role so that you can just

[00:30:39] run. I appreciate it. We would love to be able to see that. We're rooting for Rebecca and with that another one is in the can. We out. Live from Unleash in Las Vegas. We out. Thank you for listening to what's it called? A podcast. The chat. The cheese.

[00:30:59] Brilliant. They talk about recruiting. They talk about technology. But most of all, they talk about nothing. Just a lot of shout outs of people you don't even know. And yet you're listening. It's incredible. And not one word about cheese. Not one cheddar. Blue. Nacho. Pepper Jack. Swiss.

[00:31:21] So many cheeses and not one word. So weird. Anywho, be sure to subscribe today on iTunes, Spotify, Google Play or wherever you listen to your podcasts. That way you won't miss an episode. And while you're at it, visit www.chatcheese.com.

[00:31:42] Just don't expect to find any recipes for grunt cheese. So weird. We out. As I chat with people who have expertise in various areas of business, you'll enjoy the lively conversations that are focused on providing you with the ideas, tips and suggestions you need to realize greater success.

[00:32:22] Get what you need for your business when you need it from the people who have the answers. Accelerate Your Business Growth is part of the Evergreen Podcast Network and is available on Apple, Spotify or wherever you listen to your favorite podcasts.