How subscriptions built this job board into a niche leader

In this episode of JobBoardGeek, we talk to Andy Hibel of HigherEdJobs, the leading job board for careers in academia. Andy talks about how HigherEdJobs got started - including a number of revenue-free years. Jeff Dickey-Chasins of JobBoardDoctor and Steven Rothberg of College Recruiter learn about the role that annual subscriptions have played in both satisfying employers and helping the site succeed. Jeff and Steven also discuss the current rosy financials from publicly-held job boards, and whether this will continue - or not.

Transcript

0:00:33.0 JD: Hello everyone, and welcome to JobBoardGeek, it's the podcast about the business of connecting candidates and employers. I'm Jeff Dickey-Chasins, the JobBoardDoctor. I am your host, and today I'm here with the gregarious Steven Rothberg of College Recruiter. He's the co-host. Hey, Steven, how are you? 

0:00:52.0 Steven Rothberg: I am really good today, Jeff. Nice to be here with you and our mutual friend will be joining us later, and I say friend with a heavy dose of sarcasm.

0:01:03.0 JD: Yeah, well, you've got a history with him as do I, and in fact, the person that we're talking about is Andy Hibel of HigherEdJobs, he'll be coming on in a little bit, and he's literally a fount of wisdom as well as a podcaster himself. So anyway, before we get into that Steven, I wanted to talk about something that actually came out today on my blog, which was a bunch of news about job boards doing very, very well, recruit holdings, HR division which includes Glassdoor, Indeed, 51job, SimplyHired, Workopolis, etcetera, etcetera, is hitting about $6.2 billion, ZipRecruiter just saw a third quarter revenue increase of 81.3% to $227 million, Upwork's gross services volume is up to $1 billion, which is kind of crazy. And then the Ringier Group, which is based in Switzerland and has a number of job boards, is also up to $972 million in 2021. DHI, DHI with Dice, which always does kinda mediocre-ly, is actually seeing the growth of their first quarter revenue to 28.7%, which is really quite good. Red Arbor down in Brazil is doing great, they went up 40%, etcetera, etcetera, etcetera. So hey, hot times in the job board industry and kinda no surprise, because the market is very, very constricted and hot right now for labor, so companies are willing to spend whatever they have to spend to get people.

0:02:39.0 JD: But the question that I have, which probably everyone in the industry has is, how long is the party gonna last? Have they already start moving the chairs around and someone's gonna be sitting down on the floor in a few minutes, or it's just gonna keep going on for a while, or is it just going to taper off over time? My personal belief is that this is actually going to keep going on for quite a while, because the fundamentals that are driving it, which is a lack of people to fill the jobs really hasn't changed, and at least in North America, particularly the US, the things that would make it change like massive immigration, a big jump in the birth rate, etcetera, etcetera, none of those are happening, and they're certainly not gonna happen very quickly. Europe is struggling with a lot of the same thing, so that's my take on it, but Steven, you're kinda different, you're bi-national, what's your take on it? 

0:03:33.0 SR: I'm kind of different. Boy, if I had a dollar for every time somebody that I know and love told me that I was kinda different. So reading your e-newsletter this morning, it reminded me in a weird way, and go with me on this, of when you go to New Orleans and you realize it's really, really hard to find bad food in New Orleans, every restaurant is just great. And I think right now in the job board world, call it marketplace or whatever you want, there's some of that going on that every job board practically is doing well. And we've talked to a couple that are still struggling, and there are always gonna be some organizations in just about any industry that are going through difficult times, maybe going out of business for one reason or another, but overall, these are definitely golden times. It also struck me that, is it been 20 years now that we've been hearing the job boards are dinosaurs and job boards are dead? 

0:04:30.0 JD: Yep.

0:04:31.0 SR: And it is just not correct. Now, one thing I disagree with you about is, I don't think that there's a lack of people in the labor market, I think there's a lack of appropriate matching, there's a lack of employers offering positions and pay that people actually want. If you paid people enough, they're going to go into those jobs, they're gonna come out of working part-time or working gigs, and they're gonna go back into the regular labor force. And I think there's been a tremendous reluctance by employers to do that. We just published a blog article last week on stickiness, the stickiness of the labor market, and I think it was pretty instructive if employers paid enough, they'll see more. So I agree, I think these are good times, I think we're gonna continue to see these good times where... I think at the beginning of this, not at the end of this.

0:05:22.0 JD: Yeah. Actually, I don't disagree with you on what you said, I tend to be somewhat cynical about the ability of employers to react in a positive way, in a broad-based way. Individual employers I think do adjust and raise their compensation, try to become more attractive in tight times, but a lot of employers just think, yeah, it's always been this way, why should we change? So yeah, I agree that what you say is also true, but I guess we'll just see what happens, that's always my response anyway, every downturn that I've run into since 1981 is like, wWell, we'll just see what happens. So today, we're very lucky to have someone that we both know quite well, Andy Hibel, of HigherEdJobs. I first met Andy face-to-face in an airport hotel a long, long time ago, and have had the good luck to see him on a regular basis ever since then. Welcome to JobBoardGeek, Andy.

0:06:20.0 Andy Hibel: Thanks Jeff, thanks for having me. Nice to see you, Steven.

0:06:23.0 JD: Yes. And Steven and Andy know each other even longer than I've known Andy, so I don't know if that's good or bad, but that's the way it is. So, Andy, why don't you...

0:06:35.0 SR: Good for me, bad for Andy.

0:06:36.0 JD: [chuckle] Right, right. Yeah, that's what everyone says about you Steven. So anyway, Andy, why don't you give us a little bit of background in terms of how you got into the job board industry and what your background is and how HigherEdJobs got started.

0:06:52.0 AH: Sure, I'll try to be brief. I feel like I need to offer a disclaimer for anybody who's listening. A conversation with the three of us is usually something that most people have a difficulty navigating so...

[chuckle]

0:07:04.0 AH: I'm gonna try and make this as simple as possible. Kinda the best way to describe my career path would be I'm an estate and tax lawyer, that's my training. I'm an accidental entrepreneur, that's where HigherEdJobs come in. And I'm extremely reluctant podcaster.

[chuckle]

0:07:22.0 AH: So that I would kinda give the trajectory of my career. Basically, I was working at a big 10 university along with my co-founders, John Ikenberry and Eric Blessner. And it was the mid '90s. We all had had a rough time finding our first position in higher education, working in fundraising. And we set about trying to find a better way to find a job in higher education. Didn't necessarily think it was going to be something that would become our lifelong careers, but thought it would be something that would be nice supplemental income to our professional positions. And here we are 26 years later doing the same thing.

0:08:01.0 JD: Yeah, I kinda took over your life, didn't it? 

0:08:03.0 AH: Yeah, very much so.

0:08:04.0 JD: Why don't you tell us a little bit... I mean the name of your site is pretty self-explanatory in some ways and not totally in others. Why don't you tell us a little bit about who HigherEdJobs targets and give us a feel for some of the services that you offer.

0:08:18.0 AH: It's actually interesting, as Steven and I have met many people simultaneously over the years. And lots of times people get confused what College Recruiter and HigherEdJobs do. And while we both might be on campus, to say that we're both on campus is about where the similarities end. Steven's audience is working with college students. We're working with the faculty and staff that serve those students. So we're looking at anything from a professor or any sort of academic position to anything that's administrative.

0:08:47.0 AH: So right now I was with a number of university presidents. For the first time in 26 years we're talking about a lot of infrastructure and physical plant employees, getting people in those seats. There's not been a lot of instances where universities have been concerned about recruiting positions that would traditionally be filled with good talent relatively easily. It doesn't usually reach the president's office. Now it has. But people are often surprised to find out that we also have those positions.

0:09:18.0 SR: And I think particularly... And I am really proud to be a part of this community. When you look at equity issues through the pandemic, there's been a lot of questions of what can be done, how it can be done thoughtfully, how can we bring folks in. And between the challenges in recruiting throughout the university, combined with the change and how a lot of folks are working on campus, but also the way a lot of folks are still working in the same way throughout the pandemic. It's actually been a really difficult time to lead for a lot of academic leaders to figure out how to appropriately address all the challenging and competing, in some ways, missions of what the university wants to accomplish and the type of organization it wants to be. And that's definitely been a challenge over the past couple years for a lot of colleges and universities.

0:10:06.0 SR: They're not immune to the labor force issues that are affecting the rest of the economy. That's interesting. One of the many things that I really liked about Jeff's vision for this podcast, for the JobBoardGeek podcast, was that he wanted to ask our guests to share information about their business models or practices that were pretty different, or unusual at least. And one of the things that I've seen over the years from talking with you Andy is that HigherEdJobs has, and I believe you call it your labs, kind of like this other way of experimenting with maybe a new pricing model, new technology, a different approach to serving your customers. Maybe you can share with our listeners why you have a lab rather than just throwing stuff up on to the main site, pros and cons to doing that, because I do think it's fairly unusual.

0:11:00.0 AH: And maybe before I do that, maybe laying a little bit of a foundation of how we operate, because I think we operate very similar to how we operated back in 1996, which is now extremely different from how a lot of other folks operate. We're more of a job board in the sense of we're paper posts, we do not aggregate jobs, we do not broadcast jobs, what you see is an infrastructure that is its own. The number one reason for that is our model has worked. It's traditionally delivered quality candidates to our employers, and that's been kind of a cornerstone of our success.

0:11:38.0 AH: At that cornerstone we have an unlimited subscription where we have 1200-1300 colleges and universities that are subscribed on an annual basis to post as many jobs as they can for a single price. And that's kind of been our model that kinda drives our content, drives our engagement with our employers, and in turn also drives our engagement with a broader audience of job seekers and people in higher education. With that, we kinda go about things a little bit differently.

0:12:07.0 AH: When we look at the model and trying to explain to our customers how it works and why it works, and we've had good success doing that. If we're trying to do something a little bit different, universities tend to like to stay with the tried and true. And people who are looking for jobs at universities tend to want to have their needs catered to kind of a little bit different of a job search or a little bit different of a career experience that they have as opposed to the for-profit world.

0:12:34.0 AH: When we start looking at things that change from that basic model, what we're trying to do is find places where we can add value to our core model without upsetting any of those fundamentals, so we'll try different ways of going about that and experimenting that way. Some work and some produce some benefit to us and to our audience, others don't. And it's done so in a safe way. To be honest, at least for me, after 26 years of doing that, it also kinda keeps some of the work interesting. We work with between 4000 and 5000 universities a year. That's a lot of universities to have specific needs for and for what we do in our day-to-day, it's a pretty big task to accomplish year after year.

0:13:17.0 SR: Well, Andy, one of the other things that I know about your organization in terms of how you guys function is on the leadership side, you actually have, for all intents and purposes, three leaders, the three founders, and it seems like that's a huge plus in a lot of ways, and sometimes it's not such a huge plus. You wanna talk a little bit about that? And how it ended up that way? 

0:13:38.0 AH: Yes, we have a polygamous leadership model... It's a different way of going about it. I think for us it works well. I think from a creative standpoint, having all of us with equal voices, but very different voices, it really helps us come at a problem in a very different way than a lot of other leadership teams might do it. And I think that's been a big source of our strength. And some of the management issues... And I'd say it's just a handful. It can prove challenging, but I'd say at this point, we have a pretty good sense of how we'd like to manage collectively, where we have a comfort level doing things and it's worked well. What I would say is, Eric's the youngest of us, quickly pushing up against 50, it's very different than managing a job board in your 50s as compared to your 20s, particularly when you still have some visions of yourself as a 20-year-old job board owner, but I would say, for the most part, the wisdom that comes after these years has probably also enabled us to be able to get through some of those places where it's harder with that model to manage.

0:14:47.0 AH: I think that you'll probably also address that while I'm here in Chicago, John and Eric and their teams are out in State College, Pennsylvania, we're 600 miles apart, that happened in year two of higher ed jobs, I moved Chicago, got married, not moving back to State College when the business took off and we've worked through it, so it was kind of weird when the pandemic hit, the idea of working away from each other really wasn't hard. I see John and Eric regularly, but it's not like I walk into an office with them every day. I think that was actually a lot of practice for being able... When March of 2020 hit for us to be able to pivot and just kind of be okay with it, we use a lot of the tools between the three of us that now the company was using on a regular basis.

0:15:37.0 JD: So you mentioned the pandemic, and I'm kinda curious too, we've asked this to a lot of the guests that we've had on, in terms of the effect that the pandemic had, what did it do for higher ed jobs? Was it short-lived or was it something that was more deep and systemic? 

0:15:52.0 AH: I think a lot of universities right out of the gate thought, Hey, we're gonna be back on campus in six to eight weeks, we can deal with this recruiting thing later, and that was a very, very, very disconcerting feeling for us. I don't think we reached complete and total panic mode, but it did produce a lot of consternation. I think we quickly saw our big... So university budgets are usually renewed as of July first, the vast majority of universities, and so much of those subscription renewals are actually geared with the fiscal year, so with those subscriptions we knew come mid-May to beginning to mid-July, we have a large number of subscriptions that were coming due, and that was kind of our stress test. No, 2020 was not as great as previous years, we typically renew subscriptions on 97% or 98% rate, much to Jeff's grin, but that rate went down, I think to 92%, 93%, 94% in 2020. So yes, we lost some, but it wasn't like it was... We got through the July renewal season and had fairly good confidence that, okay, this is not gonna be a great year, but the fundamentals of our business remain the same.

0:17:05.0 AH: Actually, I think the bigger way we were affected is we expected to bounce back, but we didn't... We kind of got a bounce back that when it bounced back at us, it came back so much harder that we weren't ready for the demand that came in once it bounced back and 2021, we spent a lot of time rethinking how we wanted to do things and ourselves dealing with the labor market and trying to recruit, and I think we finally feel like we kind of have a grasp on it, but I say that feeling like I'm knocking on wood and I don't wanna jinx it, and I'm sure John and Eric will be listening, cringing when I say that, but I feel like it's pretty good.

0:17:43.0 JD: I wanna jump in real quick here, and Steven, I know you wanna ask a question, but I just gotta jump in here as the job board doctor and make a comment on this renewal number issue. Andy's absolutely right, their renewal rate is way too high, and I say that because when you have a renewal rate that's significantly higher than 90%, you're not charging enough money, and I think almost every client that I've ever talked to, I always say, you should be charging more. I don't make ridiculous demands that they triple their price or something, but when you have a product that's on a renewal basis and you're renewing close to 100%, there's probably a lot of room for price increasing there, because even if you're renewing at the 90%, 92%, 93% rate, that's great, but I hate to leave money on the table anyway, so... Steven, you had a question, I believe.

0:18:32.0 SR: Yeah, no, that's interesting, Jeff, you do wanna have a very high renewal rate, but what I'm hearing you say is that if it's too high, when you get into that virtually 100%, it might mean that you're... Maybe 80% of your customers would be willing to pay 20% more.

0:18:49.0 AH: Exactly.

0:18:52.0 SR: So you end up with a lot more revenue, I think what job board owners need to also take into account, is it's not all about the money, I think that that perspective is from a financial statement perspective, what does our income statement look like, what does our balance sheet statement look like. But most entrepreneurs, and I think we would all agree with this, we don't just go into it looking at the dollars, it's also about the lifestyle, it's also about improving the communities. And so a high renewal rate can also indicate that we're doing a lot of good in other areas, maybe we're just happier, that we're less stressed and we're willing to take less money to get there, but...

0:19:31.0 SR: The question that I had for Andy is about that subscription product. A lot of our listeners are going to be primarily transactional and employers coming out to their site, whipping out a credit card, buying a job posting for a $100, $200, $300 and month after month after month, you have to sell to them to get them to renew. What was the foundation? Where did your subscription product come from? Whose idea? Why did you go down that path? And I would think that you're thankful that you did because it seems like it's a real cornerstone of your success.

0:20:06.0 AH: It's kind of funny. It reminds us of the first sales person who we hired way back when and kind of joked that we didn't really hire him. It was a friend from development, his name is Paul Oliver. And Paul kind of showed up one day and said, "Hey, I'll work for this." And we said, "Okay, but come and sell." And at the time that Paul started to sell, he did a really good needs assessment but we only had one product, and that was the subscription. So he would do this needs assessment, and then at the end of the needs assessment, he'd say, "Well, I have the right product for you." And he'd sell the subscription. And he was good and the subscription was a good value. It was really, really nicely done and very thankful, Paul's quality of customer service and salesmanship was so important at that stage.

0:20:50.0 AH: But the subscription actually was our only product to start, period. At day one where... We gave it away for free for two years and we kept our day jobs, we kept our expenses to a minimum, and we got several hundred universities using it for free. It was easy. They posted all of the jobs. We had an easy system to do it. We didn't have to do much work and it worked. So to say there were some big strategic way to do it, we got a lot of jobs. We got it at a very small transaction cost and we were able... Because back in that day, you weren't purchasing traffic from people, you were trying to do the two-sided market of getting jobs there. So job seekers would come and people to post jobs so they could get applicants. And that was kind of our way to kind of light the fire, if you will.

0:21:41.0 AH: I'd like to say, Steven, yeah we thought about different models strategically and we were so smart we came up with this. I think as time went on, we understood that we converted those people from free to paid over time after about three to four years. We realized that the subscription had a different place and as other products now relate to it, it yeah, it is our cornerstone, but it is by far not the only product we sell now like we did back in the day.

0:22:07.0 SR: Yeah.

0:22:08.0 AH: And I can quickly respond to Jeff, just real quick. On the renewal rate, Jeff's been a wonderful consultant and collaborator with us. But it's one of the things if you are gonna hire him, the first time you'll pay for that advice. But the repeated times of hearing that we haven't charged too much, I believe he was generous enough to give us that advice for free on a very regular basis after the fact.

[laughter]

0:22:35.0 JD: Yeah, it's probably so. I talk too much as everyone on this podcast knows. But well, listen Andy, it's been great to have you on the podcast and congratulations on the continued success of HireEd jobs. If any of our listeners want to get a hold of you, what's the best way for them to do that? 

0:22:51.0 AH: I'm gonna ask listeners for... If they do want to get hold of me, what I'd really love to hear from people... So we're doing a playlist, Jeff, as you know, on our podcast of good songs for job search and for careers, because every job search deserves a good soundtrack. And Jeff, you put two amazing songs on that. Welcome to the Working Week by Elvis Costello. See the album behind you and then also, you put career opportunities by The Clash, great song. But if people have songs that they think we need to put on that list, please, we love to hear from you. Reach out to us at podcast@hireedjobs.com and let us know what you think and if you're looking to reach me, that podcast email actually goes to me as well so, I'll be able to pick up whatever you want to send there. But I really appreciate being on here. Always love getting time with the two of you and appreciate that you guys are creating the time to put this podcast out because I think it's a lot of value.

0:23:47.0 JD: Well, thanks, Andy, I appreciate that. And yes, definitely check out their podcast. Andy has done some good things on that. In fact, he had me on the podcast and I'm not gonna say that was the best one episode yet, but it was one of the best. So anyway, thanks for coming on. And Steven, if anyone wants to get a hold of you, how do they do that? 

0:24:08.0 SR: Well, they're definitely not gonna do it at a Chicago Blackhawks game, because that would be really painful for me to be there, and that's another story. Just Google and Andy Hibel, Steven Rothberg, Chicago Blackhawks, and you'll see what I'm talking about. But they can email me steven@collegerecruiter.com, and 100%... Our listeners should also be subscribing to the HireEd Jobs podcast. The content is quite different, quite complementary. And I find that 90% at least of what you guys talk on there. Talk about on there is not strictly about HireEd, it's about finding a new career path or interviewing or if you get ghosted. And these are issues that exist in all industries. But you guys do a fantastic job Andy, thank you.

0:24:58.0 AH: Thank you for that. The team is fantastic. Kelly, Mike and Monica really... We really put our heart and soul into it so I really appreciate that.

0:25:07.0 JD: And I have to say that the recording quality is better than JobBoardGeeks.

[laughter]

0:25:12.0 JD: But we're trying to get better. So, that's it for today's episode of JobBoardGeek. Please be sure to subscribe on Spotify, Apple, whatever particular feed that you particularly like because we're on them all as far as I know. My name again is Jeff Dickie-Chasins, the job board doctor. You've been listening to the only podcast that focuses on the business of connecting candidates and employers. That's it for today. And we'll see you again next time.

[music]