Five things I’ve learned building an online staffing business
Building Relode has been the most challenging and exciting business endeavor I’ve ever attempted. What excites me most is how much demand there is for a new solution. Staffing is an industry that has been stuck in the stone ages, and no one has really challenged the existing agency model. Every customer I’ve ever met in my career has a love/hate relationship with their staffing suppliers and there’s very little loyalty. The relationships rest solely with the account managers, not with the agency. As an industry, we really have no product, our product is the people we employ and deploy.
Successful companies must focus on building a meaningful brand and delivering value to their customers. In order to accomplish this, they must attract and retain top talent. We’ve all seen the same story play out time and time again. A large customer hires a new HR executive who is determined to eliminate agency spend, job orders to staffing firms dry up, spending on contractors soars when hiring managers become desperate and internal recruiting teams fail because they don’t have enough resources. Eventually, vendor management systems (VMS) are implemented, service and satisfaction decline, incumbent agencies go away and are replaced with new ones. Then the cycle repeats.
Staffing is a simple business—you must have good jobs and supply good candidates to win.
Here are the top five things I’ve learned while building Relode:
1. Technology alone is not the answer.
Customers are ready for change, but they are not ready to commit to an all tech solution. They are familiar with the agency model that provides white glove service and delivers interview-ready candidates. Many of these clients are still working off pen, paper, and spreadsheets and barely use the expensive ATS that they just installed across the enterprise. Relode’s not trying to remove the human element from staffing, it’s just enhancing it with the right technology. Making all involved more efficient, faster and better while saving millions.
2. Top recruiters are burnt out and tired.
Recruiters are tired of the cubicle and out of touch recruiting managers who used to recruit with a fax machine and yellow pages. Recruiters dream of working for themselves, building their own agency, or working virtually from the beach.
3. Building software is complicated and expensive.
We’ve made significant investment in software over the last few years, and some of it has gone in the trash. You can’t just outsource to a developer to deliver a product you’ve dreamed up. It’s about doubling-down on what’s working and getting rid of what’s not. It’s a continuous iteration of the product that never ends. Software’s never finished, it’s just deployed. You must have a great development team, embrace change and exercise patience, while simultaneously going as fast as humanly possible.
4. Burning the ship is scary.
Human nature says to return to the boat and go where it’s comfortable and safe. I’ve had this feeling many times while building Relode. What I’ve learned is that if you truly are committed to disrupting an industry, you must go all in and not look back. You will fail many times, but you must have enough resolve to overcome those set-backs and try again.
5. Technology can and will eventually eliminate over 50% of the recruitment process.
Over time, it will reduce the need to have buildings full of recruiters and related infrastructure. I’ve built two staffing firms employing hundreds of recruiters in buildings, but with this model, recruiting only occurs when people are in their seat, logged into an ATS and calling candidates. Here at Relode, we’re building a 24/7 virtual recruiting machine without the limitations of brick and mortar. We’re on our way to creating a marketplace with no boundaries and no limits.
It’s not going to be easy, and we certainly don’t have it all figured out, but I now see a path to making thousands of hires each month on our online marketplace while driving 25-50% savings to our customers. If that doesn’t challenge the existing agency model, then I don’t know what will.