Melbourne-based Web start-up 2Vouch yesterday launched the first public beta of what it dubs its "social recruiting platform".
2Vouch aims to help companies find great staff faster and cheaper through enlisting the power of peer referrals, according to the company's founder and chief executive Riges Younan, who outlined his firm's ideas in an email interview with bootstrappr.
"Over a decade of executive recruiting experience has clearly shown that referrals are the best source of talent," he said late last week. "Many firms have informal internal employee referral programs and many professionals have received calls asking, 'Hey, I'm trying to find an XYZ person, do you know anyone?'."
It's an area that Younan knows well; he has over 12 years of executive search and recruiting experience in Sydney, Melbourne, London and New York, and has been responsible for launching five start-up recruiting offices for various firms.
However, the CEO said, the process, technology and tracking of such referrals was ad-hoc and inefficient. This is where 2Vouch steps in.
"We decided to help solve the problem ... by building a Web-based system that uses referrals, social networks and rewards to bring employers and recruiters together with 'passive candidates' automatically, quickly and cost-effectively," he said.
Passive candidates are workers who may not be actively looking for a new job, but could be open to one if the right opportunity came up.
For workers, 2Vouch offers cash rewards for referring people they know to job opportunities. The front page of the site lists, for example, a referral reward of $1,400 for a computer game programmer. The system also allows successful referrers to donate some of their wins to charities like the Salvation Army or the Heart Foundation.
For recruiters, it's free to list job ads on 2Vouch, with the start-up promising wide distribution of job listings through blogs and social networks. "Customers only pay when they hire or place someone," said Younan. "We also provide a 110 per cent money back guarantee if the person doesn't work out."
Younan said 2Vouch was self-funded to date and could continue to rely on its own resources while it proved the viability of its model, although it was currently talking to investors ranging from angel groups to Australian and offshore venture capitalists. The start-up's goal is to build a successful business, in the process disrupting the online recruitment market currently dominated by the likes of Seek.
"If we do that successfully, an exit will cross our path at some point," Younan said.
The other major force in the start-up is general manager Jeremy Samuel, a start-up veteran with three previous companies under his belt and skills in marketing, sales, project management and consulting in the IT and telecommunications sectors.
The executive also happens to have an MBA and a Masters in Cognitive Science. Younan said the pair decided to work together after Samuel had been referred to the CEO.
2Vouch currently has the equivalent of five full-time staff, and an advisory board including IT industry veteran Martin Nicholson and start-up consultant Phil Morle of Pollenizer.
Like the Australian start-up I covered last week, MyPerfect.com.au, 2Vouch has a strong business model.
The company's approach of broadening and formalising the referral idea most large companies have is a good one, and there is plenty of room for them to skim a few dollars off the top if it takes off. Even a small number of successful referrals would start to bring in revenues.
In addition, the online job board market is clearly headed for a shake-up in just this direction. The likes of Seek.com.au, MyCareer.com.au and CareeOne.com.au, with the big budgets that their backers can afford, have been ruling the roost for too long with their traditional models that have simply converted the traditional newspaper job advertisements into online equivalents.
The double-punch pair-up of two veterans (Younan and Samuel) is a good one, and the addition of Morle is likely to make sure any investor in the company feels safe.
Bootstrappr found signing up to 2Vouch quite easy. A nice touch was the fact that Younan's own email address is used to email new users to confirm their new account. This is a very personal touch that other start-ups would do well to emulate.
It's hard to evaluate the referral service without a real-life example, but for now the technology looks good, and the site is designed well.
However, the start-up does face some challenges. For starters, the online jobs market is already crowded: not only with giants like Seek but also small, specialised firms like NowHiring.com.au. 2Vouch will need to invest a significant amount in marketing the service (probably in a variety of mediums from word of mouth to mainstream media) to gain traction.
There's going to be a lot of legwork ahead for Younan and his team, as online accommodation site Wotif.com — which has a not-too-different model for hotel room inventory — must have had to do in its early days.
Even with these challenges in mind, 2Vouch still has enough to win it our second tick of approval.
bootstrappr opinion: BOOM