Companies like Identified, Gild, and HireVue are aiming to help recruiters, who are flooded with resumes, run a more efficient and accurate hiring process.
Job boards make it easy for companies collect resumes and get the word out about job openings. However, job boards also make it easy for applicants to apply for many jobs at once. The result is that recruiters, HR teams, and hiring managers are left to sift through an overwhelming number of resumes, many of which do not match or are largely unqualified for the open position. These solutions also do not help recruiting teams discover so called passive candidates – those whose skills may fit a particular job requirement but who are not actively seeking new employment.
Now, funding is being directed towards an increasing number of technologies that source, screen, and assess job applicants with the aim of quickly and efficiently separating the good candidates from the bad as well as easily targeting passive candidates.
Examples of the technologies include the following:
- Assessment technology used to score the ability of a coder based on their activity and influence on sites like Github
- Matching algorithms that help determine if the candidate will be a fit in the company culture based on personality assessments
- Searching technologies used to screen the online resumes of hundreds of candidates to find specific skills needed for a particular job
- Social recruiting applications to target and engage candidates on sites like LinkedIn and Facebook
- Video interviewing platforms used to minimize cost and time and maximize flexibility with the interviewing process
From Q3’12 to Q2’13, these applicant sourcing, screening, and assessment technologies raised over $97 million in funding via 33 deals. YoY deal growth over the past two years has been over 83%, while over the past five years, YoY deal growth has been over 75%.
Notable deal activity includes the following:
- $21 million in Series B funding to Facebook sourcing company Identified
- $11 million in Series A funding to social recruiting sourcing company Work4 Labs
- $8 million in Series A funding to coder assessment company Gild
Q1’13 had the largest volume of deal activity over the last five years with eleven deals, but Q2’12 had the largest total funding at $41 million. Most of the funding in Q2’12 came from the HireVue and Work4 Labs deals.
Specifically looking at funding Q2’13, Chequed.com, a predictive employee performance company received $2 million in seed funding, while Entelo, a company that helps recruiters search for the best software engineers and designers across the social web, received $3.5 in Series A funding from Menlo Ventures and Battery Ventures.
Over 86% of the deal activity to the applicant sourcing, screening and assessment industry went to early stage funding rounds. Specifically, seed/angel rounds made up over 59% of deals, while Series A rounds made up over 27% of the deals. Some examples of seed/angel financings include $1 million to DecisionDesk, $0.75 million to TrueAbility, and $0.2 million to HireIQ Solutions.