The resources-stretched mainstream media are always a sucker for the latest ‘internet entrepreneur’ hoping to put a dent in the traditional recruitment industry. If you are a young female entrepreneur with the older blokes in private equity backing you, then all the better.
This week former Bain & Company associate-turned-entrepreneur Bridget Loudon was the beneficiary of these sorts of soft free kicks with Fairfax Media giving her and her business, Expert360 (‘an online matchmaking service for executive consultants’) the sort of write-ups that PR firms absolutely love.
Both BRW and the AFR devoted plenty of uncritical column centimetres to a business not yet two years old with (unverified) turnover of around $1 million from an unspecified number of completed assignments.
Fairfax Media describes the business thus:
Expert360 is an online freelance marketplace but unlike more general competitors such as Freelancer.com, oDesk-Elance and Airtasker, it concentrates on freelance projects for senior business consultants. Expert360 uses algorithms and staff input to produce a shortlist for time-poor businesses seeking experts.
Hmm, I thought this is exactly how most recruitment agencies operate when clients request consultants/contractors? Maybe it was the use of that multi-purpose technology word ‘algorithms’ that suckered the journalists.
It is also revealed that ‘Expert360 is starting to cut in on the wobbly middle tier of the executive recruiting industry’.
On what evidence this claim is made, we are not told other than Ms Loudon’s quotable quote that ‘People have just gone nuts for it.’
Then we are told that, according to Peter Wilson, the chairman of the Australian Human Resources Institute that:
Expert360’s commission is far lower than the consulting fees charged by the likes of traditional headhunters. Not only does Expert360 take less than the usual 20 per cent of the consultant’s salary, Wilson notes, hirers-turned-employers also need not stomach the 30 per cent “poison pill” recruiters traditionally charge if a client wants to employ the consultant at the end of the contract.
Really? So our industry ‘takes’ twenty per cent of what Mr Wilson seems to suggest ‘belongs’ to the consultant.
Wow, that’s a very one sided way to view what a recruiter does.
How about mentioning that the recruiter actually worked his or her backside off (probably for many hours) to find said ‘consultant’ a paying assignment at a rate that the consultant agreed to. Then the recruiter negotiated an agreed rate with the client, that included a fair return (ie margin) for finding, paying and managing said ‘consultant’.
Then we are told that if a recruiter does their job so effectively to the level that the consultant they found for the client is worthy of a permanent job, we have the gall, according to Mr Wilson, to charge a ‘poison pill’ (how this is an appropriate metaphor is beyond me) of 30 per cent. I would be fascinated to know how many recruitment agencies or search firms in Australia received a 30% temp-to-perm fee in the past financial year.
At least the AFR journalist (Ky Chow) spoke to a traditional recruiter (Michael Markiewicz, CEO of Carmichael Fisher) and printed his response (well, one sentence of it at least); the BRW journalist (Caitlin Fitzsimmons) did not.
Maybe I am a bit simple but by the time I had read both articles, I was no clearer as to exactly how Ms Loudon’s enterprise was significantly different to a traditional recruitment agency.
The cynical side of me might suggest because Ms Loudon is young, female, good looking, an ex-management consultant and has an ‘internet business’ based on ‘algorithms’ that she provides a user-friendly package for resource-poor journalists.
This is no criticism of Bridget Loudon. Good on her. If I was in her position, I would be doing exactly the same – doing everything I could to generate some free publicity, especially in the mainstream media. It’s (yet again) the journalists that facilitate this sort of story, and their employers that decide to publish it, that dishearten me.
Given our industry has recently been subject to a spate of one-sided and generally negative stories, it’s not hard to see to see how ‘real’ journalism has been replaced with easy-to-manufacture outrage or PR-prompted feel-good stories about an industry’s supposed Next Big Thing.
On the positive side, I was encouraged by this BRW article earlier in the year that took a harder edged and more realistic look at the downsides of internet based job marketplaces.
Let’s hope these sort of articles are not going to become less common as publishers look for more ways to grow profitable output with the same or fewer resources.
In the meantime can the mainstream media please stop giving soft free kicks, and start applying some journalistic rigour, to ‘internet entrepreneurs’, especially in the recruitment industry.