It has been a busy few days in the HR Tech Space.  It all began when SAP announced it’s $3.4 billion acquisition of SuccessFactors on Saturday to put the HR Technology industry on notice.  Then yesterday it got really interesting with the surprising news that SuccessFactors acquired Recruitment Marketing Platform company Jobs....

While both acquisitions are important to the industry (SAP probably moreso), the one that really interests us is the Jobs2Web acquisition.  Over the last few years, Jobs2Web and our company, SmashFly Technologies have pushed the limits of what a Recruitment Marketing Platform can be (they’ve changed the name of their platform with the acquisition). We will continue to provide innovation for companies that are looking to more cost effectively hire top talent.

This acquisition reaffirms our belief that the sourcing technology space is growing and is where a ton of innovation is occurring. Companies are coming to the realization that a centralized platform is required to mange all their sourcing & analytics and will become even more critical in the coming years.

Here are a few other thoughts we have from the announcement (I encourage you to read Ed Newman’s thoughts on the acquisitionas well):

• Focus of sourcing technology: There are three major themes that today’s sourcing technology is focused on: distribution, analytics and contact relationship management.  Here is a summary of each:
• • Distribution: You are using a variety of channels in your recruiting today from job boards to social networks to recruitment SEO to resume databases.  You should be able to have one system that enables you to distribute your jobs to all these channels simply & easily.
  • Analytics: You need to have a system in place that enables you to measure & analyze how all the channels you use in job distribution campaigns perform in terms of views, applicants and hires.  All the most important recruiting metrics need to be in one centralized location so you can make sense of the data to make better recruiting decisions.
  • Contact Relationship Management:  Jobs2Web calls it Talent Communities, we call it Talent Network / CRM but no matter what you call it, it’s the ability to build a database of recruiting contacts that you can communicate and engage with.  These contacts can then used for future job campaigns to drive qualified applicants into your ATS, reduce the time to hire and ween yourself off other more expensive recruiting channels.

• Value recognized:  In an interview with Jobs2Web CEO Ken Holec, he mentions how the initial acquisition price expectation was $65-75 million.  To receive $110 million (6-7x earnings, which is high), there had to be considerable demand for the sourcing & analytics technology that Jobs2Web offers.  Another confirmation of the value that sourcing solutions like ours and Jobs2Web provide in the marketplace.

• ATS company reaction: We expect there will be some moves by the big players in the ATS space.  Sourcing is not the strong suit for many of these companies and they will need to find a way to compete with SuccessFactors in selling situations whether through acquisitions or partnerships.

• New Opportunities: Will other ATS companies continue to work with Jobs2Web?  The in-house ability to work with SAP & SuccessFactors customers is a huge win for Jobs2Web but the question remains if other companies such as Taleo, Kenexa & others will want to actively work with a company owned by a competitor.  Some customers may give them no choice but I have to think this is an opportunity for other sourcing & recruitment marketing platform vendors to make in-roads with these ATS companies and their customers.

This is the first major move in the emerging Sourcing & Recruitment Marketing space and will definitely not be the last.  This is yet another data point that validates that the recruitment marketing & sourcing technology space is a game changer and we will continue to innovate with our platform to make it the leader in the space.