How The Muse CEO Kathryn Minshew grew to $10.9M revenue and 600 customers in 2024.

good morning everybody my guest this morning is Kathryn Minshew she is the CEO and founder of the muse dot-com a career platform used by over 50 million folks to find a job learn professional skills or advance in their careers and by hundreds of companies looking to grow their employer brand and to hire now Katherine is a Wall Street Journal and Harvard Business Review contributor and she's spoken at MIT and Harvard along with the Today Show and CNN she's been named the smart CEOs future 50 innings 35 under 35 a Duke alum Katherine worked in Rwanda with the Clinton Health Access Initiative before founding the muse and was previously at McKinsey & Company Katherine are you ready to take us to the top thank you for making the time so tell us first for those folks that are not familiar what is the muse and specifically what's your revenue model how do you generate money yeah so the muse was founded to be the most trusted and beloved place for people to navigate their career what does that mean it means to be function essentially like a marketplace we have over 50 million people who use the site every year to find a job get to that next step talk to a career coach get advice learn a skill anything that's related to taking charge of your career and sort of living the life that you want and then on the other side we have over 600 companies from Facebook Dropbox slack to HBO goldman sachs marriott businesses large and small and we help them with hiring an employer branding so the way I like to think about it is you know the sort of old way of doing things was a company could just put up a job description and expect that some of the most talented people in the world we're gonna line right up to come in that's no longer the case if you want really great people you've got to compete for them because everybody else wants them to and so we help these companies figure out first of all what is the story what is it that they have to offer great candidates how do they survey their top people and understand what are the core elements of their employer brand their value prop to employees then how do you tell that story through photo and video through amuse profile we have a lot of different ways companies can do that especially kind of you've gotten these great stories from employees sharing those to a broader audience and then finally having to distribute that so how do you make sure that anywhere a company's trying to hire they have the ability to reach those candidates and to get more context and assets in front of those people to help them decide whether working at Goldman Sachs or New York life or Facebook is the right place so should we think of you more like a LinkedIn recruiter or like a media brand that makes revenue from impressions so it's a I don't know if you've heard the sort of word going around New York Tech these days but it's a sass enabled marketplace that's probably close we do compete fairly directly at times with LinkedIn with indeed with Glassdoor but interestingly we do also in some ways work well with them like we've found a lot of companies that will use their news assets and the reviews platform and embed it or link it to some of these other platforms and it makes the entire kind of some work better than the individual parts and so for those that are not familiar with a sass enabled marketplace right help us understand and give examples in specific in your business right what part is the marketplace and what part is the sass component yeah so most companies sign up for an annual subscription to the muse and that can be anything from you know four to five figures for an SMB or a small mid market company all the way up to six figures for a major fortune 1000 makes the average Kathryn that's a good question so right now the average is between twenty and thirty K okay but the the enterprise number of enterprise deals is rising quite a bit more quickly than our mid-market business so I think you will continue to see that go up we're also we look at sort of average by category um in that case you have associate very different things based on the employee account do you mean like a financial sector category versus a no because we work with businesses of all sizes within a specific industry more like the the employee count of a company our legacy mid-market or enterprise so when your satirising it says it's not by industry it's by team size industry has other effects on the site but the biggest one in terms of contract size is simply how large is your company how big are your recruiting needs somebody that has 50,000 employees it's going to be radically different than somebody with 500 employees that's crazy that everywhere in between so back to your question about a SAS enabled marketplace essentially we have these businesses of various sizes that subscribe to the muse it's an annual subscription and through that they get a range of different tools they have the ability to literally have a profile on the muse site and hire from our community but also we give them a number of tools edible sort of widgets for lack of a better word I need a better word for that and measurement and analytics dashboards that allow them to understand how they're doing across different pieces of their recruiting funnel and optimize not just the recruiting they're doing on the muse which is the marketplace component but on their own career site through their own social channels etc so the marketplace is literally on the news com where companies can post job listings and profiles and we have again this sort of audience of millions that might apply directly but for us we realized that we were essentially wanted to build some of these products that we started out focusing on their existence within the marketplace and take those to a much yeah to a much broader audience and actually I'll give you one example quickly we have a business we're working with that has I want to say they have between 50,000 and 150,000 employees I should know exactly but who are we talking about can you share no I'd rather that's okay some of our larger clients are sensitive if we don't get there approval you know to you know talk about them in the press I can also be more candid if I if I haven't identified the client they are recruiting for really sought-after talent they need to build up data science engineering of course a wide variety of sort of technical and product related positions they're having trouble competing with some of these newer and more digitally savvy companies and so not only are they recruiting via the muse and hiring people through our channels but they have a pre-existing social media presence of tens of thousands they have a talent community but they're not doing a lot with but has I think something north of a hundred thousand members so how do we not only help them recruit through the Mutis because we've got a great population a lot of women a lot of Millennials a lot of digital natives but how do we also then help them take those lessons and apply it to these existing channels but they may have built up previously as a fortune 1000 company but they're not optimizing and and officiating from really effective and so are these ways any marketplace right everyone talks about chicken-and-egg right and all the analogies for you specifically did you did you get the traffic you know the fifty million people coming first with content or did you launch as kind of a platform that's really sexy company profiles and then say oh my gosh we have to figure out to get traffic here we started with the individual users the people although in this sort of span of the company's history they were both started favored early so when the amuse when the muezzin issue a launch to 2011 sort of late 2011 September we just had career related content tools and resources for individuals and we didn't roll out our first company profile until we had a hundred thousand people a month using the site and you make not making any money at that point B or is it ad driven no no no we've never had on the site okay I think banner advertising has no place your guys's site is too beautiful to be destroyed by this vomit it's so let me ask you the question though right so you you went several years then before you introduced this revenue model how did you support yourself where'd you get the cash from yeah so we actually had a hundred thousand users a month in about six months okay so it was not all that much time the early cash came from my savings account yeah so when I started the business my co-founder and I kind of looked at our bank account so we said alright based on expenses and things we need to make you know set aside for the business this is how long we can last and we got really close to the end was that when catherine was at scamming we was at a scary and actually scary position for you or had you dearest it was terrifying can you quantify it like how much did you have in savings and how much did you put in like I mean were you literally at the brink well so when I left McKinsey I had twenty five thousand dollars savings and I was thinking about possibly starting a business but I didn't have an idea I was in love with yet and so I got this offer to move to Rwanda and work for the Clinton Health Access Initiative on vaccine introduction and that was essentially a net neutral offer so what they said was we'll give you the flexibility of only working for us for six months and we will give you this incredible incredible experience but they said as a result we will pay all of your expenses fly you there housing food etc but we're not going to pay you a proper salary above and beyond that it'll just be sort of met neutral and they were a non-profit and I said that sounds great I would much prefer to have the flexibility and not have the cash and how old were you at this point Kathryn 25 okay I think 25 so few years out of college I'm McKinsey you get this offer 25 in your bank account a great experience you take it exactly I will say when I started at McKinsey I had almost nothing in my bank account but I lived as if I was making half of my salary because I knew that I wanted to do something that might not pay a lot of money I wasn't sure whether it was moving to Africa whether it was starting a business whether it was something else entirely but I've always thought that savings are freedom and so I said look you know I'm making 65k a year and I'm gonna live as if I'm making you know how cheaply can I live in Manhattan which by the way is not easy to do it's not easy I'm soda water I'm still soda water exactly but you know what like every every time you do that you're putting away money for your future and that's how I looked at it so I had 25k when I came back from Rwanda I still had about 25km 24k because I got a little bit of traveling and I started working on actually a business that was pre news but it was a very similar idea we created a Content platform for professional women and that was where we laid a lot of the groundwork and said wait a second there's this huge need for individual candidates who are thinking about it sorry not even candidates humans people that are thinking what do I want out of my career how do I be a better manager can I put an emoji in a workplace email and does that make me seem young or junior or as a casual and fun and how do I think about navigating and sort of workplace rules and so we were building up this content site and we realized that firstly people were incredibly hungry for what we were offering and secondly that there was an opportunity to do something with employers that would feel so much more human than what was honestly frankly the case of the most classic job sites like an in deed or these other things with no story or emotion absolutely I mean even today in most cases you are confronted when you go to those sites by a giant link search shop yep you have to type something in and you'll get three thousand seven hundred and twenty four results and they all look the same what sort of fix I mean I'll get off my soapbox but I am offended that for so long but that was adequate for one of the most personal and important decisions in someone's life which is what are you doing with your life what are you doing with your career and anyway I will go all the way down the rabbit hole but I really felt like there was an opportunity to change that so I'm so much of that 25 Katy to put in the business so I spent about 20k on living expenses with the first company which was effectively research and services I didn't spend it on research I spent it on rent and food and hang for a metro card so I think around New York but I had about 5k left and to make a long story short we had there were four of us that started that first kind of project slash business started as a project became a business we had two very different visions and so Alex and I my current co-founder to this day so to split off the other two took that and made it kind of something different took it in a different direction and we started the beetus and I had about 5 K left which frankly was terrifying because firstly I was spending my living expenses we're cheap as I could possibly get them I had moved out to Brooklyn how about ever still probably $1,800 all-in so you're three months runway exactly and rent was half of that everything else was like blood sweat and ramen and and so yeah we but we felt like we had to start with the users so we put up the user side of the platform of the marketplace first and we attract is what is this just Catherine is this is you writing no it's funny I didn't start the muse because I knew all the answers I started it because I knew all the questions and I needed the answers so I wrote very infrequently in the beginning but I sourced a lot of the best advice and I know how to find it so we went out and tapped a broad community we didn't have any money we were selves much less writers at that point but we said look we can build an audience and we are building an audience of mostly women who are thinking about what is that next step in my career and if you have expertise or you want to help other people follow the path that you followed then we'd love to invite you to contribute to the site and so the first version of the site was we probably had about 50 articles or so career advice skill building links out to other resources and we launched our first job listing about a month later it was a test we did it with a little known so the compilot start-up called uber that had about 50 employees at the time and we decided to see if we could get them some hires from our platform do you make money off the hire like a typical recruiting firm does so in that first arrangement we were supposed to we don't anymore it's just the SAS platform ok in that first one I think we made 600 dollars off of the sort of you know email and sort of work that we did and then there was a I afraid of it's 2000 or 2500 dollar success fee unfortunately uber made 2 offers from the muse and both people turned down those jobs so we didn't get the success money but big caliber of people who came through was so high that we felt like we had proved we were honest so fast forward to today this is 2011 you started it you have to to v2v co-founded by the way do you split 50-50 no how'd that how'd that conversation go um it was honestly not bad I mean here's the thing so there were three of us in the early days Alex and I were kind of all in full-time and that Melissa was a she had been at McKinsey with us she was accepted to a PhD in cancer biology and we were trying to convince her to put that PhD on hold to come and do the business and we ended up deciding what is she had a smaller percentage and she actually worked on the muse and did her PhD first year full-time then put the PhD on pause was full time on the news for a year and now is back doing her PhD not active in the business but I'm actually in her wedding as a bridesmaid that's amazing yeah she's she's so she's coming it's still in the cap table then yes yeah got it and then Alex and I we had gone full-time and taken on risk in slightly different ways so I mean it's a tough conversation anytime you're talking about equity it's not something I would do for fun ever gosh no the same time you know we both we both came to it with we want to work together mm-hmm we want to make this happen we want to get somewhere that feels fair to both of us no it's never gonna feel perfect right but it needs to feel tolerable to do it with us and so it's it's close to be even but there was small differences based on again how much risk how long each of us had Vince would without another full-time job because we left our roles at different times and that's great we have Katherine we have a few minutes left so again equity there's someone that was early with you have a very small portion and then you guys basically split the rest basically equal with some tweaks to make it fair talk to me about funding you raise capital how much yeah so we raised gosh first about a 100k in January of 2012 plus we got into Y Combinator so that came with about a hundred and seventy thousand dollars that was our first seed funding it was very hard one and we ended up over the last couple of years raising over twenty eight million dollars so we've had a little better luck with fundraising but the sort of first three and a half years of the muses life were were pretty lean it was seed funding bootstrapping making revenue here and there our product we've charged for four employers from the very beginning because we didn't feel like we had a choice to go with a freemium model that said we've always wanted it to be free to individual users so that was really important to us and then we raised a ten million dollar series a in spring of 2015 and then sixteen million dollar series B last spring /summer so so it's almost a year from that last race so you're either in fundraising mode right now or indeed has a 50 million dollar offer on the table to acquire you what one is it so we're in we're in gracious are you far you break even or close to it no but we've been sort of closer or farther at various points and we have a fair amount of control based on how fast we want to grow what we want to invest in whether we want to let that gap get further or narrower and I think that your burn rate is that the gap you're talking about exactly there's lots of different ways to build a business so I'm kind of skeptical of people who claim to have found the one true path but I think for us it's been really helpful to have structure the business in such a way that you know our customers pay for a fair point of our growth and we can use venture capital really to accelerate not to sort of suppose yeah exactly yeah how many employers are you working with today is paying customers you say active that I'm either I'm gonna read into that and say either some people have started and then stopped or they're just it's a seasonal business so if they've stopped why have they stopped the ones that weren't happy yeah so business yep we actually we basically know sometimes when somebody's getting acquired we didn't realize this pattern at the beginning but we will regularly have companies especially again tech companies not the company companies that will send the email out of the blue we think that they're very happy and they'll email out of the blue and say I need my profile to come down and we used to just freak out because we thought what's wrong turn yeah the service turn and inevitably you know four to twelve weeks later they get acquired so that's a reason we also in fairness because the UM by the way that's valuable information if you're an investor I know yeah sometimes we just we have our suspicions yeah and then of course because our product is you know it's a marketplace it depends to some extent some employers are better or worse figuring out how do they actually you successfully market themselves to candidates yep so occasionally we have companies that are like you know we only want to hire iOS developers and some companies do that very successfully on the news and others really struggle in it honestly it depends like can you make a case for why an iOS developer with a lot of good options would want to come work and your business if you can great they're out there if you can't you're gonna have a hard time 600 customers times an average selling price of about 30 grand per year puts you at somewhere above 18 million is that am i doing the math correctly I don't comment on our active revenue like we have a wide range of kind of customer sizes and types so yeah you'll have to wait till the next reporter scoop to figure out whether you're right or not you guys will have to come on and watch the YouTube video and judge Katherine's smile when I ask that question to figure out what the real number is Katherine let's wrap up here with the famous five number one what's your favorite business book all the time I also read a book called traction recently by a guy named Gino Wickham in which is anyway such an odd name and stuck with me that I really enjoyed about some of the basics of running a business and it's for small businesses but I think it's interesting for people that are scaling as well and you've just launched your new book tell us about it real quick yeah it's called the new rules at work it came out the week before last with crown business penguin Random House super excited reviews have been great it's essentially a a to see guy into the modern workplace so how do you figure out what you want to do go out and get that job and then succeed manage up delegate be more productive all of the things you need to do to sort of effectively navigate the 21st century workplace the new rules of work will linked on the show notes number two Katherine is their CEO you're following or studying right now oh my goodness I you know I follow and study a huge number of CEOs no one that's sort of above all I would say everything from I think let's see Jennifer at Rent the Runway is to doing some super interesting stuff right now Elon Musk is probably on everyone's list there's a company called and Ella Jeremy Johnson the CEO he's fantastic and very biased and I don't know that's probably three I'll leave it at three okay and then number three a five here your favorite online tool like acuity scheduling oh so I love boomerang Biden which lets you pop emails out of your inbox and bring the back and then I'm gonna cheat and give you a second which is pocket because I love I'm a voracious reader I absolutely and I'm just very curious like I I just love to stuff I love knowing things and of reading thinking discussing and yet it can be really distracting in the middle of the workday when a great article gets emailed to you or something so I save it to pocket and it just automatically uploads to my phone and then I can read it on the subway or an airplane or something like that number four Kathryn how many I was asleep to get every night okay it varies I actually I need more sleep I am NOT one of those people like I could get by I'm four I'm really unhappy if I get less than about six and a half yes so I try an average you know between six and a half and seven and a half some weeks they do better some weeks I do it worst and then take us home here with the last one take us back to your 20 year old self what do you wish that Kathryn knew I wish she knew it was okay to be different I stressed out a lot about being you know a bit of an odd duck growing up and I wish she knew that everything worth doing is hard and so persistence and grit are probably two of the most useful things and I think really grateful to the way I grew up and have a ton of money but really figured out how that kind of just handle you know situations as they're dealt will keep on going and that's been so helpful and so I think 20 year old Catherine would have enjoyed knowing that it's gonna work out okay there you guys have it from Catherine founder of the muse it is okay to be different everything will work out okay again came out was working Mackenzie sixty five thousand dollar salary saved up about twenty five grand because she was really smart imagining expenses then went on an amazing journey with the Clinton Foundation out in Rwanda doing great work came back launched the company put about five grand and which is basically all she had could he spent the other 20 grand on living expenses in New York the Muse is now again growing super fast over fifty million active folks there annually again connecting with brands and brands creating great company profiles over six hundred employers are using the muse again average selling price for those contracts to work with the muse between 20 and 30 grand for specific cohort per year and again launched in 2011 Katherine thank you so much for taking us to the top all right thanks so much