According to an Ibisworld report, the online recruitment sites industry is estimated to have grown at 15% CAGR from 2015 to $10 billion in 2020. The growth in the industry is attributed to the improved job market conditions in the last five years. Santa Monica-based ZipRecruiter is an AI unicorn in the market.
ZipRecruiter was set up in 2010 by Ian Siegel, Joe Edmonds, Ward Poulos, and Willis Redd. The company began its life on a kitchen table in Ian Siegel’s house. Prior to setting up ZipRecruiter, Ian had worked at a few other startups. His experience at companies like Stamps.com and CitySearch taught him that entrepreneurs needed to find one thing that differentiated them from the others.
The idea behind ZipRecruiter came to him because he was tired with the hassle of having to post job openings to multiple boards to reach candidates. He was looking for that “magic button” that could help him post job openings on multiple job boards and help him gain access to a viable talent pool. With his other co-founders, he set up ZipRecruiter as a side project to help small businesses distribute job postings at an affordable cost. What began at his kitchen table is now a leading online employment marketplace that leverages AI-powered smart matching technology to actively connect millions of employers and job seekers. It claims it is a matchmaker for the job seeker and the employer, helping them find the right fit.
ZipRecruiter has more than 1,000 employees today spread across the US, Canada, the UK, and Israel. It has over 200 engineers on its staff and 50 of them operate out of an R&D center in Israel. The company is leveraging advanced algorithms to help recruiters and candidates find the right opportunity. It has worked with more than 1.8 million businesses including some Fortune 500 players. It witnesses more than 25 million job seekers on its site on average each month accessing over 9 million active job postings.
ZipRecruiter was bootstrapped for the first four and a half years of its existence. It earns most of its revenue by offering subscriptions to employers to let them list openings, or for services to enterprise customers who pay for traffic on a pay-per-click or pay-per-applicant basis. Even before it raised its first round of funding, ZipRecruiter had clocked more than $50 million in annual revenues.
Since 2014, the company has raised $219 million in funding from investors including Industry Ventures, IVP (Institutional Venture Partners) and Basepoint Ventures. Its second and latest round of funding was held in October 2018 when it raised $156 million at a valuation of $1.5 billion. ZipRecruiter does not disclose its financials. It has been profitable since 2014.
ZipRecruiter is not the only player trying to set up a match between the employer and the employee. There are several other competitors who use AI-based tools to find the right match. It is up against companies like Hired, HackerRank, Andela, and many more who are also using various forms of evaluations and algorithms to find the right match for a job. Competition is intense even within the job board segment. And, that segment has also seen consolidation in the recent past. Last year, Glassdoor was acquired by the Japanese player Recruit Holdings for $1.6 billion. ZipRecruiter is hoping to stay independent for now.