Hcareers

Hcareers – CEO to drive growth for trade sale of online media company

 

Background

Hcareers was a Canadian Job Board specializing in the hospitality industry. It was started by a group of investors from the hospitality business, and had grown well to become a $1,000,000 a year turnover business. However, it was one among many, and the shareholders wanted to bring in managerial expertise to work with their trade knowledge and build the company for trade sale and enable them to realize the return on their investment.

The mixture of a great core business, shareholders with clear goals, and knowledge of where they added value and where they needed outside managerial help was appealing to me.

Strategy / Business Model

The job board business model is radically different from most businesses and especially food manufacture. Job boards were at that time valued on market leadership, and their fiscal value was a multiple of revenue not profit.

As with most advertising businesses, whoever has leadership has significant built-in advantages:

  • Advertisers, in our case hotels, want to advertise where the most relevant job seekers are, and will pay a premium for this. Therefore the market leader finds selling ads easier, and can achieve higher prices.
  • It is also easier and more fiscally efficient to get job seekers to visit your website regularly, as you have more job adverts than anyone else.
  • The variable cost structure of the business is also unique, in that many of the costs are relatively fixed, making incremental sales highly profitable. The web site has a fixed cost whether it has one job advert on it or one million. Marketing to jobseekers is a relatively fixed cost again regardless of volume of job adverts.

Therefore, we had a shareholder base that understood the benefits of outside professional business management, a valuation basis that rewarded revenue growth, and a business model with significant profitability on incremental volume. The base strategy agreed by the board was maximum revenue growth with $1m profit.

The key success drivers for Hcareers were:

  • Adding sales resource effectively to tap into what was practically an unlimited market.
  • Investing in marketing to communicate to job seekers that we had the most relevant jobs in the hospitality industry.

 

Implementation

As we worked through the process, we stuck to some key strategies:

  • Building a significant sales operation, as we had a massive potential market in North America, and every dollar of extra revenue added more than that to our valuation. We increased the sales operation from 10 people to over 120 at sale. These people were split by industry type, and within that by customer type, to ensure focus on the markets we wished to penetrate.
  • Balanced investment of profit between sales and marketing, based on the understanding that these two issues are interrelated and need to grow in tandem.
  • Continued marketing investment in our core benefits – “The Most Jobs & The Most Job Seekers”.
  • We structured the business with different goals by division, dependent on our market position within each market.
  • Our budgets reflected rapid growth and investment, and targets and bonus schemes made up a critical component of the budget process.

Leadership / People

We created a highly motivated sales led company with high bonus driven remuneration available, and lots of fun activities to drive the required energy. We reviewed the progress of each division monthly with management, and we celebrated successes with the whole company monthly. Through this we achieved a highly driven and targeted sales and marketing operation.

 

Outcome

Hcareers became the largest hospitality job board in the world, with growth rates consistently over 45% a year, while maintaining a small profit. We also achieved clear market domination with the most jobs and job seekers. Hcareers was sold to a major merchant bank in the US for a multiple of its revenue, providing shareholders with 28 times the capital invested.

 

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Testimonials

"As a leader Mark has the gravitas to quickly gel and align a team towards a common goal. This comes from his ability to identify key drivers and then build strategy that maximizes return. His thoughtful & steady leadership style is the foundation for surefooted growth of an organization. November 17, 2009."

Darren Dickey, Director of Business Development, onTargetJobs

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