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TTL LookBack V1: Connecting With Investors to Propel Technical Innovation

Welcome to Talent Tech Labs Lookback. We spend a lot of time exploring the Talent Acquisition Ecosystem and Marketplace and while every TTL Trends Report focuses on a different theme, we occasionally like to look back at some of our greatest hits.

As we take a glance back at our  V1 Trends Report, we covered an array of topics ranging from our ecosystem, a look inside TTL, to meeting with TA and HR companies. We are honing in on one particular interview, our director Jonathan had the opportunity to meet with Corey Greendale of First Analysis. We uncovered the intel and research from Corey as he covers topics from successful investments, HR trends, talent acquisition and investment portfolios.


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Interview

TTL Executive Director Jonathan Kestenbaum sat down with Corey of First Analysis, a firm specializing in research and investment in SaaS, education technology and talent acquisition technology, to talk about good technical investments and how emerging organizations can stand out. Interestingly enough, investment research and reporting are only half of what Corey Greendale does. He also manages a $100 million venture capital fund that makes investments in companies that are in specific industries with good long-term growth characteristics—usually technology related. The fund’s most recent investment was in Recsolu, a Chicago-based company in the talent acquisition space. Recsolu is primarily focused on recruiting talent right out of college to more than 50 Fortune 500 companies. Corey shared his insight and thoughts on the exciting world of talent acquisition technology and what it takes for him to consider making an investment in your company.

TTL: Corey what makes a company a good investment for you?

COREY: At a high level, we look for companies with recurring revenue and strong customer retention rates. We target companies that are growing at least 25% year-over-year. In terms of stage, we like to see sufficient revenue to demonstrate market traction, and we target investing $3 million to $10 million as a lead investor or as a syndicate partner with value-add perspective.

TTL: So growth and revenue determine a successful investment?

COREY: Certainly those things matter a lot, but growth rate at the time of investment is rarely sufficient to guarantee a good outcome. You need to have the right people in place: management that can steer the ship when it inevitably hits choppy waters. That’s why the quality of management is an extremely important consideration in our investment decisions. You need people who can not only build a great business but who are capable of evolving with it. We also look for companies that play in large markets and that are disruptive to those markets. They need to have offerings that are sustainably higher-value or lower-cost than what’s currently available in the market.

“There’s a definite advantage to companies who adopt and implement HR technology to help them find and attract the best talent.”

TTL: Do you find it interesting that your number one criteria for investment is a great team, when those same companies are on a mission to improve the HR experience altogether?

COREY: I think it reinforces the idea that teams are incredibly important. I think it’s true whether you’re investing in companies or you’re a company investing in your own human capital. People matter more than anything else. Technology is important, but people are the key differentiator. We understand that at an investment level.

TTL: What does your investment portfolio of companies currently look like?


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COREY: It’s a diverse group. In our most recent fund, we have three HR-related investments. In addition to Recsolu, we’re investors in UniversityNow, which disrupts the learning and development space with its low-cost high-quality accredited degree programs. We’re also investors in Chrome River, a leader in the travel and entertainment expense management space. All three of those companies fit our investment criteria well, with very strong teams, and all three are growing rapidly.

TTL: You are very focused on talent acquisition. Why?

COREY: We believe the war for talent is real and that it’s going to accelerate, particularly for skilled talent. As we discuss in detail in our Talent Acquisition Technology white paper, demographic trends suggest the youngest part of the workforce will shrink in coming years, suggesting companies will need to enhance their recruiting toolbox in order to attract the best talent. The ongoing shift to an information economy also puts a premium on skilled labor in areas like software development. We believe companies that adopt and implement effective HR technology to help them find and attract the best talent will have a competitive advantage.

“People matter more than anything else. Technology is important, but people are the key differentiator. We understand that at an investment level.”

TTL: What trends do you see in HR?

COREY: The quality of the workforce is increasingly moving up the chain of employers’ strategic priorities. The economy is on the upswing, suggesting it will become even more difficult to find good talent. I see more companies – big and small – taking HR more seriously and investing more of their time and money in the area.

TTL: Do you see a gap between HR and technology?

COREY: HR has tended to lag other business areas in adoption of technology. For example, a number of providers have interesting talent analytics offerings, but analytics haven’t been adopted as widely in HR as they have in some other business areas. As labor moves to the top of the strategic priority list, we think that will change. Two of the key trends we expect to accelerate over the coming years are the use of analytics to better manage the workforce and the adoption of more consumer internet like interfaces for HR applications, which we think will improve the usage and effectiveness of those systems. We think we’ve just touched the surface of those two opportunities, and expect they’ll drive significant benefits for companies that adopt them, and significant growth for providers of such solutions.

Conclusion

It’s pretty clear that good investments are crucial to your company and you will need a strong team to help you create a good turn out. Corey discussed the importance of quality workforce, growth and revenue and your company team. Inspired yet? Want to discover more about investments, HR and talent acquisition? Head over to Talent Tech Labs website to get more industry insight and sign up for our blog. Want to explore more into TTL’s Think Tank and industry research? Download our latest trends reports and while you’re there jump into our series of trends reports covering topics from Real AI, Vendor Marketplace, Employer Branding and more!

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Published on Nov 6, 2017

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