The Exchanges

Q I see. Okay. And then, so how do you make money? Obviously traditional recruiting firms take 20, 30% of first year salary. I assume you have some form of arbitrage against that.

A Oh, well, we don't, uh, charge on, uh, say the first year salary, or we don't have that kind of model, uh, primarily because, uh, you know, we're not sourcing candidates. We are more of an assessment tool, and we fall after the sourcing stage. Uh, we have a, we are SaaS solution, so we have a per recruiter seat kind of model. So we charge for a recruiter seat. Every recruiter seat comes with a certain number of assessments on a monthly and annual basis, and then depending upon the size of the organization, their needs, we kind of customize the plan. So we start as small as one recruiter seat, can go up to hundreds of recruiter seats.

AI assessment note: “we are SaaS solution, so we have a per recruiter seat kind of model.”

Q And can you sort of describe them? Are they all sort of what you would expect? They're sort of the PayPal's, the Google's, the Facebook's of the world, or is there any sort of surprising cohort cohort that's using you?

A So, uh, well, I wouldn't say it's surprising now. It was surprising probably three, four years back when we, uh, when we would get customers who were typically into, uh, say engineering. When I say engineering, I'm not talking about software engineering, you know, hardware engineering, or, uh, banking segment picked up tech pretty soon. So, uh, actually before I answer that, you know, a mega trend that has taken place is obviously, um, uh, software, software is eating the world, and most of the businesses today are primarily software businesses. And we saw why the, you know, the tech companies were an obvious suspect. For us. Uh, but then we started seeing, you know, an airline company like a Boeing, uh, hiring or using hackers or, or GE in the healthcare space using hackers. So we saw a lot of different segments who were trying to build out their tech competencies in house, started building dev teams internally. And then obviously, you know, they had to build that recruiting machine and that's where hackers comes into the picture.

AI assessment note: “we started seeing, you know, an airline company like a Boeing... or GE”

Q And so there's a big debate right now happening in a CSM community on if you give CSMs quota based off the expansion they drive, or if that's just expected and there should be no quota component to their, their salary. How have you structured it? Do your CSMs get quota?

A No. So, uh, we don't give them expansion quota, so we're in the latter category. I personally believe that CSM should be responsible for driving product adoption, building a customer champion, and making a customer responsible. Expansion will happen naturally, uh, if, if all those three things are happening. Now, what happens is if you give your, uh, CSM a revenue quota, then they are only worried about revenue in the sense, even if, you know, 20 of my accounts are churning, but two big accounts can compensate for the revenue loss, they'll go for it. And you, as a company, I don't want that. I want every customer is important to me. So we incentivize them on retention and then give them additional incentives on top of your quota if you drive referrals. So referrals is independent. That's like your, you know, additional cherry on the cake, but your core incentive structure is predicated to a comprehension.

AI assessment note: “No. So, uh, we don't give them expansion quota”

Q That's right. Yeah. Now when you add up, well, actually, sorry, before I ask more questions about today, let's get some backstory here. We sort of jumped right in there. What year do you launch the company?

A Uh, so, uh, you know, we, uh, we started the organization way back in 20, towards the end of 2012, 2013, and the core motivation for us to do Hacker Earth was very simple. You know, I, I, I'm a computer engineer, software engineer by, by education, and, um, you know, we saw, um, we felt that the way recruiting is being done today, it's highly arbitrarily, uh, not, not based on skills, and often recruiters as well as developers themselves are taking wrong decisions in terms of which opportunity to go after. Uh, and, you know, being engineers at heart, we wanted to solve that problem, so that's how we kind of got into it. There's a small anecdotal story. Uh, a good friend of mine who was top of a batch, uh, you know, top of the, uh, class, didn't get through, uh, some of the top companies, and we were shocked, uh, that, you know, we were all thinking, this is the guy who's gonna get into Google, Facebook, and he just didn't get through because, uh, you know, the recruiting process or the interviewing process is, in some sense, broken, and that was the, you know, the motivation for us to kind of start Hacker Earth.

AI assessment note: “we started the organization way back in 20, towards the end of 2012, 2013”

Q Wow. Interesting. And what, what is sort of like now putting back on your founder hat and like, Hey, I want to grow revenue in hacker earth mode. What is the key metric for you guys? Is it number of assessments, number of customers, number of companies? What is it?

A So for us, it's the number of, uh, admins that we onboard to the, on, on the platform, uh, and, and that obviously gets tight. So there are two ways you could do. One is, uh, you look at growing your accounts once you land them, and that can typically happen in mid-market and enterprise, or the other is you go after a larger customer base and say, you know, I'm going to acquire 10,000 SMEs, and each one of them is going to give me two admins each. Uh, so today, uh, you know, we, we're not really segmenting our approach because the product is So, maturely built out that I could fit it to a small SMB, you know, I just got off

AI assessment note: “for us, it's the number of, uh, admins that we onboard to the”

Q Interesting. I just realized we're over time. So last two questions here before we wrap up. Burn. Obviously, Burn's critical in a SaaS company, especially during COVID. You want a longer runway. How are you and your founders thinking about Burn, and how much are you burning today, would you say, Net?

A So, uh, you know, burn is obviously, like you said, a very critical element, particularly given the current scenario. Um, obviously when COVID hit, um, our, our expansion, business expansion kind of took a hit. You know, we were all, we've been, we've been fairly successful in retaining our accounts and kind of maintaining the run rate that we were at compared to the last year, but future business expansion took a little bit of hit. So we, uh, immediately kind of, you know, uh, prepared ourselves for a lower burn. That is, you know, in terms of, uh, cutting down on, on marketing expenses and so on and so forth. But in general, uh, my perspective on burn is your burn should never be out of control. Uh, obviously to grow SaaS business, you need to spend, right? So the way I look at our, uh, journey, it has been more of a step function. So you invest, um, and you know, you reach that level. So you kind of break even, and then you say, again, I'm going to invest. And that's what we've always done. So again, we are in that stage right now. We aim to hit break even by the end of this year, and then we start reinvesting back into the business.

AI assessment note: “We aim to hit break even by the end of this year”