Q: Hi Taras, kindly state the name of your company and whether you are a VC/ Private Equity / Angel.A: Talent Equity Ventures, VC/SuperAngel Fund
Q: Do you have any HRtech companies in your portfolio and if so, which ones.
A: Yes, we are an HR tech focused fund. Entelo, RolePoint, SmartUp, VCV.ai, etc.
Q: Which is your favorite technology to invest in today and why – Advanced AI sourcing tools, recruiting tech, Screening, HRIS, talent managing, tech to support contingent workforce or others?
A: Today I very excited about three areas of HR tech:
• Contingent workforce and “total talent”: historically contingent workforce has been treated differently than permanent employees and that changing now as those to workforces are merging.
• Conversational interfaces and chatbots: that is a hot topic nowadays as companies start to see the value in using chatbots to a) provide better candidate and employee experience and b) save their recruiters and HR time.
• Performance management tools: most companies I talk to are now in the process of re-inventing their performance management practices and tools that can support that are in high demand.
Q: We see more and more HRtech applications developed for small and middle market companies – Is this a trend you feel is catching on and if so why?
A: SME market is a hard one because of the acquisition cost – you still need to spend a lot of time and resources to acquire and convert customer leads, however your average contract value tends to be much lower compared to the enterprise space. Finding the balance here is really hard.
But this market segment definitely has advantages over the enterprise – sales cycles are shorter, less bureaucracy in the procurement procedure, integration and implementation is easier, less resources required for support, etc.
Q: HR professionals are frustrated with HRTech founders for not consulting with them early in the process and listen to their pains. Startup founders don’t do so as they are concerned with exposing their ideas too
early in the process. What is your experience with startups that you are familiar with and what is the best way to go about it, in your opinion?
A: I strongly believe that ideas are worth nothing and it’s all about execution, so I am trying to avoid startups that are afraid to expose their product early on.
I think a startup founder should be working very closely with a small portfolio of clients (but for sure not with ONE single client) to discuss their ideas and test the product in real environment.
We only invest in products that have clear and straight forward business application.
Q. It seems many investors are concerned about investing in HRTech, can you explain why in your opinion this concern exists? We witnessed the LinkedIn acquisition by Microsoft, MYA’s latest $11.4M round, Woo’s $7M. Would you consider this as a renewed interest in HRTech?
A: I do not think this is true. Actually, HR tech financing is on the rise and we do observe an increasing amount of deals in this space.
Q. We welcome your opinion on any other HRtech issue you think requires more attention from all sides – HRs, Founders & investors.
A: I think HR tech founder should be thinking more about how they scale their sales. It’s not enough to build a scalable product, you also need a scalable sales organization in order to grow.
Thank you Taras, for your thorough answers and for your time!