Good morning, dear readers! (Web visitors, you can find an easier-to-read version of today’s email here.)
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Top News in the A.M.
Apple is facing a potential setback in China after much-anticipated introductions of its new iPhone models were delayed, reports the New York Times.
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Hired CEO: “We’re on a Clear Path to $1 Billion Plus in Revenue”
Some people think great hires come through networking. Hired, a two-year-old, San Francisco-based company focused primarily on technical talent, thinks much more of the process can and should be automated, and it’s seemingly on to something. More than 1,100 employers – from American Express to Secret — are now using its platform and it has facilitated more than $3.3 billion in job offers, it says. As tellingly, most of a $15 million round that Hired raised earlier this year remains untouched in the bank, according to the company.
Should boutique agency recruiters be nervous? Maybe. Many still use tech minimally, throwing people on phones and email, while Hired tries wringing every inefficiency out of the process through data analysis, providing high-touch experiences on top.
Certainly, it’s a big market to disrupt. U.S. companies alone pay out $124 billion each year to recruiting services. We talked yesterday with Hired’s CEO, serial entrepreneur Matt Mickiewicz, to learn how he’s trying to nab a piece of that pie.
There are lots of recruiting startups. What are some big differentiators that companies and prospects should know about Hired?
We’re basically flipping the funnel. Traditional recruiters sell into companies and get client contracts. We’re focused on candidates and building a consumer brand, so when you’re ready for a new challenge, you come to us because you know you’ll get offers from a spectrum of companies with minimum fuss.
How are you reaching these elusive engineering job candidates?
Thirty percent is through paid advertising – like sponsoring online developer communities and hackathons and meetups. Thirty percent is through organic sources and 30 percent comes through direct referrals.
How many candidates have you placed?
We don’t disclose that number but it’s multiple people per day.
How are companies paying you to find them?
There’s no initial cost for employers. It’s a pay-for-success model and employers can either pay 15 percent of [a new employee’s] base salary, which is typically around $20,000, or they can pay 1 percent per month [of that person’s salary] for up to 24 months, amortizing the cost across the life span of the employee.
That’s [roughly a third] more money for you.
In recruiting, traditionally, all the cost is front loaded, but the value is delivered over time. So if you’re growing fast and hiring 10 people a quarter, that’s a lot of money in up-front expense. With the 1 percent plan, companies can better manage their cash flows. It also aligns our interests. In the traditional model, if a person leaves after eight months, the company is still on the hook [for the recruiting fee]. If that happens with our model, the company [stops paying us].
What makes you so sure you’re finding the right matches?
We filter for quality – whether [candidates have] attended top schools, worked for top venture-backed startups, contributed to hackathons – and typically accept just 5 percent of applicants. We also screen for intent, meaning how likely it is that this person will go on interviews with companies based on how long they’ve been with their current employer, how realistic the candidate is . . .
Where is Hired today? Give us some metrics.
Six months after raising our Series A, we’re on an eight-figure annual run rate, which is crazy. Our employee count is 57 [up from 25 a year ago], and we’re now opening a new office every six weeks and becoming profitable [at that office] within 30 to 60 days. It’s a great product-market fit.
You have offices in in San Francisco, Seattle, L.A., and New York. Where do you go next?
We’re scaling out in the U.S. and internationally, so Boston is opening this month and we’ll be in London by the end of this year.
You talk a big game about customer service. What’s an example of going above and beyond for a job candidate?
If someone flies an engineer to New york but doesn’t reimburse that person right away, we’ll pay that bill ourselves.
You previously cofounded the fast-growing freelance marketplace 99Designs, among other companies. Think Hired will be the biggest company for you?
Yes. We’re solving a problem at scale and it works. We’re on a clear path to a billion dollars plus in revenue.
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New Fundings
365 Data Centers, a two-year-old, Emeryville, Ca.-based provider of data center services, has raised $16 million in Series B funding from earlier investors Crosslink Capital and Housatonic Partners. The company has also secured a $55 million credit facility from Fortress Credit Corp. GigaOm has more here.
Airway Therapeutics, a three-year-old, Cincinnati, Oh.-based biotechnology company working to prevent a debilitating lung condition in premature infants, has raised $4.6 million in Series A funding led by CincyTech, with participation from Cincinnati Children’s Hospital Medical Center, Queen City Angels and private investors.
Apropose, a year-old, Mountain View, Ca.-based software startup developing a web design analytics platform, has raised $1.875 million in seed funding led by New Enterprise Associates and Andreessen Horowitz, with additional support from Tableau founder Pat Hanrahan and Nicira founder Nick McKeown.
Elastic Path Software, a 14-year-old, Vancouver-based company that builds commerce software, has raised 5.35 million in Canadian dollars ($4.9 million) led by BDC Venture Capital IT Fund. Yaletown Venture Partners and unnamed individual investors also participated.
EShakti, 15-year-old, Chennai, India-based online women’s apparel retailer, has raised an undisclosed amount of Series B funding, reports VCCircle. Investors in the round included IvyCap Ventures and IDG Ventures India, which invested in the company’s Series A round.
Festicket, a two-year-old, London-based startup whose site provides users with packages including festival tickets with accommodations, has raised $2.7 million in Series A funding led by Wellington Partners and PROfounders Capital, with participation from previous investors Windcrest Partners, Playfair Capital, and Jacques-Antoine Granjon. The company had raised $680,000 in seed funding last year. TechCrunch has more here.
Harpoon Medical, a year-old, Stevenson, Md.-based company that’s developing a guided surgical tool for beating heart mitral valve repair, has raised $3.2 million in Series A funding led by Epidarex Capital. Other participants in the round include Maryland Venture Fund and the Abell Foundation.
JimuBox, a year-old, Beijing-based peer-to-peer lending platform, has raised $37.19 million in Series B funding led by Chinese smartphone maker Xiaomi and Shunwei Capital Partners, reports China Money Network. Matrix Partners China, Vertex Venture Holdings (a wholly-owned subsidiary of Singapore’s Temasek Holdings), Magic Stone Alternative and earlier investor Ventech China all participated in the round. The company has raised at least $47.2 million to date, shows Crunchbase.
Livongo Health, a new, Palo Alto, Ca.-based consumer digital health company that has developed an (FDA-cleared) interactive blood glucose meter, has raised $10 million in Series A funding from General Catalyst Partners. The company had previously raised seed funding from 7wire Ventures, which is run by Livongo’s CEO Glen Tullman and his longtime partner Lee Shapiro. The Chicago Tribune has more here.
Looop, a year-old, Melbourne, Australia-based mobile-friendly platform to enable small- to medium-size business to deliver training online, has raised $2 million seed funding from undisclosed education investor. TechCrunch has more here.
Poxel, a five-year-old, Lyon, France-based biopharmaceutical company that’s developing drugs to treat type-2 diabetes, has raised $12.9 million in funding from the venture division of BPI France.The company, whose previous investors include Edmond de Rothschild Investment Partners, has now raised roughly $50 million altogether.
Soneter, a four-year-old, Atlanta, Ga.-based company whose sensor technology detects water leaks in the home, has raised $6 million led by the GRA Venture Fund, with strategic investor Flextronics International participating.
Telogis, a 14-year-old, Aliso Viejo, Ca.-based company whose software tracks commercial vehicles, has raised an undisclosed amount of funding from Fontinalis Partners, the Detroit-based venture firm. Last October, the company raised $93 million Series A round from investors led by Kleiner Perkins Caufield & Byers.
Tinder, the two-year-old, New York-based mobile dating app, is in talks to raise a big round of funding from Benchmark in a deal that would value the company at between $750 million and $1 billion, according to TechCrunch’s sources. A big gating factor: Tinder’s relationship with IAC, which owns a majority stake in the company.
Twitter, the eight-year-old, San Francisco-based microblogging platform, is tapping debt markets with plans to raise as much as $1.5 billion to invest in acquisitions and expansion, reports Bloomberg. Much more here.
Veracode, an eight-year-old, Burlington, Ma.-based company that makes cybersecurity software for large companies, has raised $40 million in new funding led by Wellington Management, with earlier investors including .406 Ventures and Atlas Venture participating. Veracode has now raised $112 million altogether. BetaBoston has more here.
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New Funds
Advent Venture Partners, the 33-year-old, London-based venture capital and private equity firm that focuses on both life sciences and tech sector investments, has raised $146.3 million for its newest life sciences fund, according to an SEC filing that shows a $194 million target.
AngelList is expanding globally and launching new vehicles for accredited investors to back what amount to indexed AngelList syndicate funds for the top deals on the platform, reports TechCrunch.
Darwin Ventures, a 10-year-old, fund-of-funds focused on early-stage venture capital, is aiming to raise up to $100 million for a third fund-of-funds according to an SEC filing flagged yesterday by peHUB. So far, shows the filing, the firm has raised $21.4 million for the effort. Darwin raised its last fund, a $94 million vehicle, in 2008. It closed its debut fund with $40 million in 2004.
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IPOs
Virobay, an eight-year-old, Menlo Park, Ca.-based clinical-stage pharmaceutical company developing treatments for neuropathic pain, autoimmune disease and fibrosis, has filed to go public. StrictlyVC is running a little behind this morning, but you can see its S-1 here.
Xenon Pharmaceuticals, an 18-year-old, British Columbia-based drug maker focused on rare diseases, has also registered to go public. You can see the filing here if you’d like to know who owns what.
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Exits
Lift Labs, a 5.5-year-old, Bay Area company that that created tremor-canceling technology for patients with Parkinson’s disease, including a spoon that makes eating easier, has been acquired by Google for undisclosed terms. The firm’s employees will join Google X lab.
Movirtu, a six-year-old, London-based startup whose software enables companies to avoid paying costs incurred by employees using their devices for personal use, has been acquired by Blackberry. Terms of the deal weren’t disclosed. According to Crunchbase, Movirtu had raised at least $5.5 million, including from TLCom Capital Partners. Business Insider has more here.
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People
Kurt DelBene, a former Microsoft executive who spent six months this year helping to fix some of the glitches associated with the Healthcare.gov site, has joined Seattle-based Madrona Venture Group as a venture partner, the firm said yesterday. The Seattle Times has more here.
PunchTab, a nearly four-year-old, Palo Alto, Ca.-based loyalty and engagement program, has appointed Mike Mansbach as CEO. He replaces founding CEO Ranjith Kumaran, who will “take an active role on the PunchTab board,” says a release. Mansbach previously spent roughly a decade at Citrix as a VP of enterprise marketing, global sales, and, most recently, customer care. Before founding PunchTab, Kumaran cofounded the file sharing and online data storage company YouSendit (later renamed Hightail). StrictlyVC talked with Kumaran last winter about how much tougher it has grown for startups to draw Series B funding.
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Job Listings
The Kaiser Foundation is looking for a pre-MBA investment associate to help out with its $600 million endowment. The job is on Sand Hill Road, in Menlo Park, Ca.
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Essential Reads
Facebook is testing a feature that lets you schedule the deletion of your posts in advance.
Marissa Mayer’s day of reckoning at Yahoo is fast approaching.
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Detours
More than half the U.S. population is now single, up from 37 percent in 1976, when the government began tracking such things.
How crossword puzzles are made.
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Retail Therapy
The 2016 AMG GT S, with actual “race” mode. Coming next spring.