What kind of business is talent auction?

Recently, the recruitment field is very hot, and various products have sprung up. Among them, I am most optimistic about two model innovations: one is blue-collar employment based on LBS; the other is the auction model for mid- to high-end talents. This time, I will share with you the logic behind the talent auction business.

What is a talent auction?

Let me first explain what a talent auction is. In the past, when we recruited, the recruiter would post a job notice and the job seeker would submit a resume. A talent auction is actually a reverse recruitment: the job seeker posts a resume, the recruiter offers a position, salary, and requires an interview.

There is a job seeker privacy issue here. There are two ways to deal with it. One is represented by the popular Hired.com abroad, which raises the entry threshold for recruiters, such as only allowing YC-invested companies to view it. The other is represented by our cute and human JobDeer.com, which uses anonymous letters of introduction instead of resumes. After the candidate confirms the company's request, he or she sends a complete resume and contact information.

In fact, both methods work well, but the difference in the recruitment threshold also determines the difference in future development, which we will talk about later.

Why didn’t there exist talent auctions before?

Talent auction is a new business in China. It did not exist before because its model is based on the sell-side talent market that has only emerged in China in the past two years.

In the past, the talent market was a buyer's market, with enterprises being the biggest. When a job posting was posted on a recruitment website, resumes came in like a whirlwind. Two piles of resumes were collected, one pile of unlucky ones was thrown out first, and then a few were picked out from the other pile, one, two, and three. But this situation has changed greatly in the Internet industry, especially for popular positions such as programmers, product managers, and designers - that is, no one is submitting resumes. The recruitment managers of various companies should have a deep understanding of this.

The entrepreneurial boom is in full swing, and capital investment continues to be active. On the one hand, the core backbones of large companies have been seriously lost. The Sina Cloud team I worked for before had a total of about 30 people, and four startups have emerged from it in two years. On the other hand, these newly established companies have to recruit a large number of people. The new wave of startups themselves have investments, so their investment in talent is not necessarily lower than that of large companies. With the same salary as large companies, they look forward to the possibility of startups, which may even be more attractive than large companies.

This change in supply and demand has rapidly turned the Internet talent market into a seller's market. As a result, websites designed for recruiters in the JobBoard mode are increasingly difficult to produce results among those who do not have to worry about work. Some recruitment websites have a good user experience and amazing mobile versions, but the resumes they receive are useless. Why? Because they are talented, they are willful. They are greeted by headhunters every day and have friends and colleagues recommending jobs at any time. They don't need to go to a website where fresh graduates and senior engineers are treated the same.

What is the competitiveness of talent auctions?

In the first three months of operation, I always thought that the competitive advantage of talent auctions was that they provided a better job search experience. Indeed, the auction model would have dedicated talent consultants to serve job seekers, and there would be career planning and follow-up on interview progress and results. These services were also well received by our customer base, and Hired.com was making a fortune from this.

But I always feel that it seems not enough to become a core competitiveness. Frankly speaking, similar services can also be provided by headhunting companies. Although there are good and bad headhunting companies now, brand headhunting companies like OfferCome are still competitive.

Until one day when we were interviewing candidates, one of the candidates said something that made my eyes light up. He said, "I came to the auction not for the salary, but for the opportunity."

Yes, the auction model can provide not only a better experience and higher salary, but most importantly, it also provides unprecedented possibilities. This is the biggest difference between the auction model and the traditional recruitment model.

If a candidate goes to a recruitment website and submits several resumes, he will have at most a few opportunities; in the auction model, he will have as many opportunities as the number of companies that send him interview invitations.

To explain it with the long tail theory, for job seekers, recruitment, headhunting and networking recommendations only deal with the popular top, while the auction model completely covers the entire long tail. When there are enough recruiters, the success rate of candidates finding jobs on this platform will be higher.

This is the core competitiveness of the talent auction model - using the long tail to highlight all potential opportunities, and then candidates choose their favorite ones, thus turning work from a simple job to earn money into an interest that is difficult to give up and rise to a lifelong career.

The curve above shows the percentage of successful recruitments in the past few months. As you can see, the success rate has increased significantly as the number of recruiters has increased. In order to achieve the long tail, we need to lower the entry threshold for recruiters while ensuring authenticity, and help candidates gain more possibilities. This is also where we part ways with the Hired model.

So what does the auction model mean to employers?

In the short term, the auction model raises the price of talent without providing any other benefits.

speed

Indeed, for non-popular talents, they are still in the buyer's market, and there is no need to recruit through auctions. Traditional recruitment channels can be used. However, for popular talents and urgently needed talents, it is often difficult to recruit suitable talents for a long time. At this time, the advantages of the auction model are very obvious: the candidates have undergone strict pre-selection and are in the recruitment period. Once the other party confirms, the recruiter can get the resume and interview immediately. For teams that have just completed financing, the entire team can often be organized in a very short time, and the cost is much lower than that of headhunters.

Confidentiality

A byproduct of the auction model is confidentiality for the recruiter. If it is a secret project of a large company, then all current recruitment sites are not suitable. However, the auction model does not have this concern because only the person being auctioned can see the corresponding job information.

More suitable talents

Surprisingly, not all candidates will choose the company with the highest salary. They often have no financial pressure and prefer to choose the company they are interested in. Many startups also take advantage of this to snatch food from the mouths of large companies such as BAT and recruit many cost-effective partners.

In the long run, although the auction model is still in its infancy and is only effective in popular positions in popular industries, it can only serve as a supplementary channel; but as the talent market becomes increasingly seller-oriented, we expect that within two years, the auction model will begin to change from a supplementary channel to one of the main channels. The earlier the recruiter enters this channel, the more dividends they will gain during the growth period.

As a winner of Toutiao's Qingyun Plan and Baijiahao's Bai+ Plan, the 2019 Baidu Digital Author of the Year, the Baijiahao's Most Popular Author in the Technology Field, the 2019 Sogou Technology and Culture Author, and the 2021 Baijiahao Quarterly Influential Creator, he has won many awards, including the 2013 Sohu Best Industry Media Person, the 2015 China New Media Entrepreneurship Competition Beijing Third Place, the 2015 Guangmang Experience Award, the 2015 China New Media Entrepreneurship Competition Finals Third Place, and the 2018 Baidu Dynamic Annual Powerful Celebrity.