A new recruit to the Smedvig portfolio: Why we invested in Adzuna
Smedvig Capital recently invested £8m in Adzuna, one of the world’s leading job search aggregators.
We are delighted to have backed founders Doug & Andrew, experienced entrepreneurs who have grown Adzuna to an established business across 16 countries, attracting over 10m visitors a month.
In this article I’ll explain why we are excited to be backing Adzuna as they continue to expand internationally.
A brief history: the shift from offline to online to PPC
The recruitment advertising industry has undergone significant transformation in the last two decades. Traditionally, employers or recruitment agencies would place advertisements in offline media such as newspapers, paying a fixed fee, fixed duration per listing.
In the late 90s, new, tech-enabled players such as Monster and Reed disrupted the existing market by shifting the concept online to ‘job boards’. The underlying fixed fee, fixed duration listing model remained the same.
Job boards remain dominant players in the industry today, and even offline listings represent a £300m market in the UK alone (1). As the online job recruitment industry has matured, new business models have emerged. Indeed launched in 2004 as the first ‘job board aggregator’. Indeed began by scraping listings from job boards to become the most comprehensive source of job listings for a job seeker. Indeed then sold the traffic it generated back to job boards on a ‘pay per click’ (PPC) model. Indeed are able to provide traffic to job boards in a cost effective way because they are able to drive high volumes of free traffic to their site through an effective SEO strategy. New job search aggregators such as Adzuna have emerged as the industry has embraced aggregation as a cost-effective source of traffic.
The picture today: a complex and fragmented online jobseeker journey
Jobseekers use multiple methods to search for jobs online. A survey found that in the UK, the most common method was job search engines such as Adzuna, but that Google, Social Media (most frequently LinkedIn), and generalist & niche job boards also feature heavily (2).
There are multiple routes that lead job seekers to a specific role.
Google recently launched ‘Google for Jobs’ in the US. A similar concept to Google for Flights, jobseekers googling ‘store manager jobs in [x]’ will now be offered a dedicated search panel with job listings & filter options. It is expected that the platform will launch in other geographies, including Europe in the near term. As we’ve seen, the online recruitment journey is highly fragmented and Google for Jobs adds an additional path for the job seeker.
Delivering ROI: Complex for Employers too
Focusing on the end employer, what does this fragmented and constantly evolving jobseeker landscape mean for them?
In-house recruiters use multiple different channels for job recruitment, most commonly, job boards, their own career sites and LinkedIn. These channels are either managed in-house (increasingly common) or through the use of a recruitment agency.
Employers are cognisant of recruiting costs and it is therefore important for job advertisers to establish the channels that provide the best ROI; a good quality pipeline of candidates for a reasonable price. Job boards are therefore focused on delivering this traffic for end employers.
Adzuna: capturing the attention of job seekers and delivering value to job boards
Adzuna has a highly successful model for delivering low cost jobseeker traffic to job boards; generate volume to the site through SEO and partnerships, and offer compelling tools to engage jobseekers & brand build.
Adzuna offers compelling products to jobseekers that aid with job searching and are highly valued;
- “Value My CV”, Adzuna’s most recognisable tool uses jobs data to estimate a salary range for an individual’s CV based on their past experience,
- “Jobsworth”, a tool that uses historic salary data to estimate the expected salary range for every job listed on the site,
- Fully comprehensive list of live job ads, easily searchable through salary, location, job title and category.
Adzuna’s strategy has meant that the business has been able to expand rapidly and capture market share from existing job search aggregators. The business is now active in 16 geographies globally and generating more than £1m in monthly revenues.
As a testament to Adzuna’s strong reputation in the UK, the business was recently awarded the Department of Work and Pensions £2.5m p.a. contract to replace the UK government’s job search platform, Universal Jobmatch. (3) Adzuna will now power the service that connects millions of job seekers with thousands of employers across the UK. With Adzuna’s technology underpinning the site, the new platform will have improved search function and usability, helping to drive job applications.
The future: driving further innovation
It’s clear that the industry has undergone significant disruption in the past and continues today to evolve and be disrupted by newer technology.
Adzuna is well placed to capitalise on the current trends shaping the industry. The strong team & management at Adzuna, coupled with the leading technology and product set, creates a defensible position in the industry. We at Smedvig, very much look forward to partnering with the business over the long term as the team drives international expansion efforts and becomes the force for disruption in the industry!
References:
(1) Enders, UK Classifieds and Recruitment category outlook
(2) Job Board Doctor, 2016 Global Job Seeker Survey
(3) http://www.cityam.com/282046/post-carillion-give-uks-small-firms-chance
