How Recruiter.com CEO Miles Jennings grew to $20M revenue and 50 customers in 2021.

hey folks my guest today is evan sohn he's the chairman and chief executive officer of recruiter.com an on-demand recruiting platform that combines ai and video job matching technology with the world's largest network of small and independent recruiters evan you're ready to take the top oh that was great that was a great description i don't know where you got that from but that was good who gave me that my gosh sleek and smooth great delivery wow i must have an awesome corporate communication person that's fantastic evan how long have you been doing this when did you guys launch um so i became ceo in uh june of 2020 i became chairman of the board in may of 19 uh in march of 2019. the company uh url's been around for a while but this all really came together in march of 2019. okay what was it before that so it was always recruited.com right so it's a great name but it was really more of a marketing organization like a media company really focused at news for recruiters uh it had various training tools and resume distribution um really just fantastic seo but it was really more of a destination site for recruiters and still is it still is a destination site for all things recruiting uh what we started to do in march of 2019 was really start to monetize this huge community of recruiters and uh and hr professionals and talent acquisition professionals that really came into the platform mm-hmm well tell me tell me more about that so some of the most successful you know freight waves is a good example media business plus major sas play and they work really nicely together you start off as a media business right so let's quantify that and then go into 2019 how many uniques was the site getting in 2019 uh we were probably getting four million dollars of organic seo on a monthly basis when qualified in terms of unique views uh difficult to quantify that's a lot it's a lot you know i usually like in the dollars i'm a dollars guy man yeah that's fine with me so four million and free seo per month yeah you know so something like three to four million dollars of organic traffic on a regular basis so again very good traffic that's monthly though right not annually that's a monthly traffic so tremendous traffic we rank number one or number two and tons of things we have all this traffic and um the goal what i really saw the opportunity to do was to really reinvent the recruiting industry so the recruiting industry is 120 billion dollar industry huge giant industry uh fragmented across you know so many different ways and sectors but the reality is nathan there's two ways to hire you either do it yourself you use zip recruiter indeed linkedin etc or you do it yourself and you sorry you do it yourself or you hire someone to do it for you and if you've got a higher dude for you you would use the classic headhunter and they would charge you you know 20 to 30 of the salary to get to place the person etc that model really has not changed in decades uh and it's now time for a variety of macro reasons uh to actually change it and what we really do is we help companies of all sizes startup companies to fortune 50 companies hire talent by either giving them fractional on-demand gig recruiters on demand so think of us as fiverr uh for recruiting or talent acquisition you need a recruiter to help you recruit financial people for the next three months pay that person on an hourly basis uh not no success fee when they place a candidate do it get the right person at the right place at the right time with the right skill set and pay them for their services that's what the gig economy is all about and that's what we do plus we also have as you mentioned you know an incredible tech stack to ensure that the recruiters are doing a great job and these tools actually stand on their own we have like 50 plus clients today that are just subscribing to our software to build pipelines of candidates and how many how many how many how many brands are paying for just the sas tool 50 over 50 yeah okay 50. and is this like a premium like enterprise pricing what are they on average per month no uh they're paying anywhere from a thousand dollars a month okay two we have some people playing like 10 000 a month depending on the scope of what they're looking for we really combine ai search and email marketing into one platform so we have you know you sound like a great numbers guy nathan we have a 160 million profiles indexed in our database okay okay full diversity all searching everything and so we use our tools to find the right person to find the right group of people and then we run campaigns literally like marketing campaigns to get them to raise their hand to say i'm interested so how else evan how else are you making money today so 50 customers out of grand a month is only 50 grand a month in mr i know you're doing yeah we're actually yeah we're actually so many of them are paying a lot more than that so our software is probably doing about 200 000 a month in software okay a little over a little over 200 000 a month in recurring monthly revenue on the software side we run marketplaces so we have job boards and marketplaces like zip recruiter and indeed uh we're generating money there how much there um another you know 150 200 000 there uh our on-demand business is growing incredibly well we're doing uh really nicely there how much got over over a million dollars a month okay and what's that model i just don't know that model that model is like upwork or or you know you pay us we we take a fee and pass the rest of the one millions your fear that's a total gmb through the total total money now and it's been growing it's over a million right okay so you know it's but evan but but to be fair here i mean 12 million in gmb are on-demand is actually fairly low for a marketplace why is that not higher yeah we're growing 25 quarter of a quarter so why not faster i mean this is a very hot space right everyone's hiring why isn't that why isn't there 100 million going through your on-demand platform i uh i would agree um we are we're uh we have a tremendous demand and we're we're balancing out the answer that you ask is as a small public company and we're a nasdaq company we won nasdaq about four months ago um we are really focused unfortunately on profitability also so it's not just about growth it's really about growth and profit and so we invested about a million dollars into our business last quarter we could have invested 20 million into and grown our sales and marketing and delivery our biggest investment was really in talent delivery ensuring that we can deliver talent faster um and that's that's our throttle point now and so we're trying to do this in a balanced fashion hit profitability and we'll get there early in 22. what the percent what percent are you taking on on-demand model about 20 to 25 percent okay so you basically have three business lines each doing about 200 to 250 000 a month in revenue so you're doing 700 grand a month in revenue total something like that oh so you're taking out the you're looking at a gross profit number the other business that we have is correct many of our we have a direct hire business so often when you're are using an on-demand recruiter as a company you'll say gee i really love that recruiter can i hire that recruiter yes companies are using us as a tribe buy and that generates another another couple hundred thousand dollars in business yep so trailing 12 months again public company or 12 million bucks in revenue something like that uh 11.8 yeah that was actually trailing 12 from our q1 numbers our q1 numbers were 4.3 million so even that on a run rate was about 16 million i you know times it by four we we gave guidance that we're growing 20 uh 25 quarter of a quarter so if we did over 5 million last quarter that brings it to about a 20 million run rate and you know we're again we're very pleased with our overall growth because we're really balancing our growth with the the need to be profitable yeah what percent i i can look this up too but you'll be quicker to ask you what percent of company do you own fully diluted basis evan stone personally yeah about four percent how did you get involved did they recruit you as a ceo like just to introduce the ipo yeah no um i was brought in by one of the original investors in the company um about three years ago to sort of help out my background really is in technology operations platforms reinventing different industries and uh you know one of the they brought me in and i'm like you have a company that owns recruiter.com if it's not a billion dollar company someone someone's making a mistake totally let's go fix it yeah so you own for you're in four percent personally i personally own four percent yeah yeah yeah how much did the company raise before you came in um very very little like under 5 million probably less than that yeah okay so here's a very interesting question i mean 40 million market cap by many you i imagine we are the most we are the most undervalued company on nasdaq so what do you think you should be valued at today i would say no less than no less than 80 to 100 million and why why is that so you look at the comps right you could say that we run a marketplace like zip recruiter and indeed and they're trading at or sorry zip recruiters probably trading at you know five six times revenues um run rate revenue you look at our our rod business our on-demand business and fiber is trading at 22 times you know that revenue so even if it's at you know even if it's at 200 000 250 000 a month in gross profit that should be trading at 22 times our sas software which is more like a docusign business operation software trades at 22 times revenue even our direct hire business which again typically is valued low is still very very low relatively speaking so if we're doing you know if we're doing a 20 million dollar run right now on revenue we're only trading two times revenue that is incredibly low my guess is even on the low side we should be trading at you know five times revenue probably even up even at this stage again you know i think i think the headwind for us is that we're a startup company on nasdaq you know and most companies are not startups on nasdaq it used to be that people were startups on nasdaq adobe microsoft all started at startups on nasdaq most companies now are like oh airbnb you know who cares if you're losing money it doesn't matter grow grow grow you know i think that we have to demonstrate uh a maturity as a startup company to actually deserve the the market the market here's here's what i don't understand though here's what i don't understand i mean look we just had pete lamson on we've had colin day on we've had you know all these people on art pop us a bullhorn right this is a very very hot space and so when you look at what k1 did in april what's job fight jazz hr nxt thing right and what they even bought that and did that deal at why is nobody just taking you private and rolling you into you know vistaprint right sorry vista equity with items or bullhorn you know yeah no i i agree look the challenge of being we were an over-the-counter company first and i don't know what that means so a pink sheet company right so we were an ootc company when i got involved i think it's been a lot of fun sort of the journey from an otc company to a nasdaq company it's got it's got some headwinds associated to it but um you know we're all here for the long haul we're building i feel like you're trying to tell me something about telling something translate that why does vista and k1 why do private equity firms don't like an historically otc company um no reason i i think that just the the headwinds on an otc company is that no one knows who you are yet you know when you when you when you uplift when you do a traditional ipo right uh you're bringing on large investment banking firms they're giving the coverage that you need they're giving you the support that you need etc i think when you a spec we will read about specs the spax is an artificial way to go public because a spack already has sort of the following the volume the ownership etc and the coverage etc when you're a small company it's difficult to make a lot of noise in the micro in the microspace that's really it and many funds have limitations on they can't buy a company that's under 200 million dollars in market cap why don't you go raise 50 million bucks and and it's a little premium to your current price and you take this public and now you own 60 percent yeah so the the answer is that we do not want to do anything dilutive right now so i could raise money tomorrow if we wanted to as a company or as an individual as a company no i think you should raise it individually team with a private everybody and take it private take the whole thing out yeah i thought about it um months ago this is a lot of fun you know we're going to be we want to deliver lots of value to our shareholders yeah but i don't believe you i mean you own four percent of a 40 million market company it's 1.6 million which is like nothing for you considering your background you've got to be i mean there is no logical person that wouldn't want to take this private and own way more of it and run with it the answer is like i i i know you want me to focus on the stock price i don't i focus on running a great company and delivering great value you know we're at the epicenter of the job industry i'm on cnbc once a month talking about the job market you know all the stuff will come i am incredibly optimistic that all of our value will be realized and we're going to have a great story you know as a public company we're having a great story as a company delivering great value for great clients and i'm not uh i'm very very confident our ability to do that i like the liquidity aspects i really do like the liquidity aspects of a public company there's something very very nice about that um that you don't get when you're a private company i've been both yeah um and i think that the uh you know we're all up for the challenge i have a great team of people around me how many people on the team right now the the company's about 75 people okay how many engineers uh we have a great cto okay um and he's got a good team of people both the combination of in-sourced and outsourced and we have product people really just uh you know our big investment now is not you know there's no more r in terms of r d there's d as in making it easier development making it easier scaling better etc we're doing a lot more volume on our searches now um there you go we're going to be a great story we we are a great story and we're just an undervalued company on nasdaq yeah yeah no i just you know when everything's undervalued especially when four percent have great information rights like you do i'm going you know what before the market does see what i see and values it full i love going 70 i'll tell you what's interesting we have very good our investors have been around for a while they're not selling right they're they're looking to make sure that this is a you know a very this is not a two times a 2x you know my long-term incentive plan is tied to multiples of the stock price not 10 20 percent like real medical fair fair fair all right anything else we should know about look i i think that companies of all sizes now have are waking up and realizing that they have this insatiable appetite or they should have an insatiable appetite for candidates for talent and uh thinking sitting back going i'm running a great company i'm not gonna lose people uh is you know that's not a that's not a post-pandemic thing we saw 4.3 million people quit in august that is not going away that we are in a new economy i call it the job hopper economy that's where we are and uh talent acquisition is really at the forefront of all these things as companies of all sizes need to hire a talent and they need to change the way they do it to really prepare for you know the next millennia all right all right hey real quick last question here do you feel like you have cap arbitrage because of the media brand i just looked at your alexa rank it's actually not that great i mean 75 000 that's actually not like the top 10 you know one percent site anymore like it used to be yeah um so what was the question again do we do you feel like you can get customers cheaper than competitors because of your media brand but then i i stepped back to say wait a second the media brand isn't quite there anymore you're not you don't break down traffic we actually get lots of inbound leads we're working on qualifying them better uh but our biggest customers are all people that hate our website really like it's pretty incredible yeah very cool all right let's wrap up with the famous five number one favorite business book uh now i'm reading uh extreme ownership number jaco number two is there a ceo you're following or studying uh ceo i follow or study uh steve jobs number and i would say you know linkedin's founder right blitz scaling is like one of my favorite books yeah reed hoffman's a good one number three a favorite online tool you use to scale the business hubspot number four did you always use hotspot or you switched them recently uh we the company always did always use hubspot and you're happy with it big fan big giant fan hub spot all right number four how many hours of sleep to get every night uh five five to six and situation married single kids married happily married uh almost 27 years wow three kids 22 2016. holy mack how old are you evan i i will be 54 in three days oh happy early birthday that's great pretty much thank you yeah your your press team goes hey happy birthday go talk to nathan for 20 minutes all right that's my birthday present yeah last question something you wishing you when you were 20. so i didn't hear you say it again something you wish you knew when you were 20. um i think the value of having really good people around you i think when you're 20 you get a little cocky thinking you could do it all and the the reality is you know you really always need a good team of people and you need people that are smarter than you that are more capable than you but also push you push you to be better than yourself and i think that i didn't know that i started my first company when i was 21 so i didn't know that at 21 and uh it's nice to really be surrounded by a fantastic team today guys recruiter.com founded in 2015 was a major major media business up through 2019 getting over four million dollars of free traffic effectively just because of the strength of domain name they've been pivoted to more sas products now three different revenue line items job boards sas and on-demand products doing call it 20 million bucks an ar run rate according to the last earnings call team of 75 as evan looks to scale the business i would argue undervalued 40 million market cap you look at others in the market in this space i'd say 100 million minimum we'll see what happens though evan thanks for taking us to the top thanks nathan one more thing before you go we have a brand new show every thursday at 1 pm central it's called shark tank for sas we call it deal or bust one founder comes on three hungry buyers they try and do a deal live and the founder shares back end dashboards their expenses their revenue arpu cac ltv you name it they share it and the buyers try and make a deal live it is fun to watch every thursday 1 pm central additionally remember these recorded founder interviews go live we release them here on youtube every day at 2 p.m central to make sure you don't miss any of that make sure you click the subscribe button below here on youtube the big red button and then click the little bell notification to make sure you get notifications when we do go live i wouldn't want you to miss breaking news in the sas world whether it's an acquisition a big fundraise a big sale a big profitability statement or something else i don't want you to miss it additionally if you want to take this conversation deeper and further we have by far the largest private slack community for b2b sas founders you want to get in there we've probably talked about your tool if you're running a company or your firm if you're investing you can go in there and quickly search and see what people are saying sign up for that at nathan lacka dot com forward slash slack in the meantime i'm hanging out with you here on youtube i'll be in the comments for the next 30 minutes feel free to let me know what you thought about this episode if you enjoyed it click the thumbs up we get a lot of haters that are mad at how aggressive i am on these shows but i do it so that we can all learn we have to counter those people we got to push them away click the thumbs up below to counter them and know that i appreciate your guys's 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