Major Singapore HR firm makes first startup investment

Photo credit: Glints

Another corporation is joining the startup game. HRnetGroup, a publicly-listed Singaporean recruitment firm with US$276 million in revenue in 2016, has made its first investment in a technology startup. The investee is Glints, a recruitment service focusing on young professionals and graduates.

The latest funding appears to be strategic in nature. “The deal also gives HRnetGroup deeper access into the fast-growing Indonesian market which sees over 2 million young Indonesians entering the workforce every year,” the press release says. Two-thirds of its 300,000 registered users are based in Indonesia.

According to Glints CEO Oswald Yeo, HRnetGroup is investing US$378,000 in his startup, with existing investors topping up another US$151,000. This brings Glint’s lifetime haul to around US$3 million.

The founders have all deferred university education to focus on the company, though its COO Looi Qin En has left.

Glints had about 320,000 visits last month, according to SimilarWeb, up 50 percent from four months ago. Most of its growth came from Indonesia.

According to its income statement for the financial year 2015/2016, the startup’s revenue grew over seven-fold year-on-year to about US$383,000, while its cost of sales grew at a much slower pace. It saw a gross profit of US$321,000 while keeping its advertising spend (not including marketing staff) under US$100,000. This is a good sign as it might indicate a scalable revenue model.

However, its administrative expenses, consisting mostly of salaries and directors’ fees, ballooned three times during that period, resulting in a net loss of US$232,000 for that financial year. The startup declined to reveal its latest numbers.

Opportunities in recruitment tech

While the jobs classifieds space appears to be crowded, with a bevy of sites including Linkedin vying for attention, not many startups are tackling the recruitment industry head-on.

A survey of Crunchbase data shows that the mature HR startups in the US are either marketplaces, HR software, or employment benefits providers. The picture in Asia is similar, with the biggest HR-related funding rounds going to marketplaces in China, Tech in Asia’s data shows.

But with automation and artificial intelligence touching every industry in the future, the recruitment industry will evolve too. In Southeast Asia, GetLinks, 100offer, and Glints are some examples of nascent startups that employ a hybrid classifieds-recruitment approach (disclosure: Tech in Asia runs its own recruitment service).

Glints’ new Talent Hunt product uses an algorithm to sieve the top candidates for a vacancy. Its in-house recruiters then do an extra round of curating before delivering them to clients. The company collects 15 percent of each successful hire’s annual salary.