In this episode, we sit down with Chris Forman, founder of Appcast and the guy who apparently figured out how to keep his sanity while building a recruitment tech juggernaut. Spoiler alert: it involved avoiding the startup graveyard of “too many ideas, not enough sense.”
We cover—Appcast’s humble beginnings as the industry's "rail builder," its glow-up via Stepstone’s acquisition (with "Daddy Warbucks" Axel Springer footing the bill), and the drama of the Bayard acquisition. Was buying Bayard a stroke of genius, or a Hail Mary pass to make Stepstone’s IPO look pretty? Chris tells us what’s what—and might even admit to annoying a few agency partners along the way.
But it’s not all corporate chess. We dive into why the recruitment industry still struggles with the basics. (Seriously, why are we still overcomplicating “Does this candidate actually meet the job requirements?” with PhD-level nonsense?) Plus, Chris weighs in on why recruitment tech leaders might be facing their own "Blockbuster vs. Netflix" moment.
Oh, and there’s a listener question that hits the nail on the head: What even IS Appcast? An agency? A media company? A tech wizard wearing a recruitment cape? Chris dishes out the real talk on why Appcast is breaking the mold—and maybe some budgets—while shaking up the recruitment industry.
Expect snark, surprises, and maybe a cheese joke or two (because apparently, Chris has a thing for dairy farms). This episode is perfect for HR pros, tech geeks, and anyone who loves hearing founders spill the tea on the behind-the-scenes chaos.
PODCAST TRANSCRIPTION
Podcast Intro: Hide your kids. Lock the doors. You're listening to HR's Most Dangerous Podcast. Chad Sowash and Joel Cheesman are here to punch the recruiting industry right where it hurts, complete with breaking news, brash opinion, and loads of snark. Buckle up, boys and girls, it's time for the Chad and Cheese Podcast.
[music]
Joel: Oh, yeah. This is the Chad and Cheese Podcast. I'm your co-host, Joel Cheesman. Joined as always, my co-pilot, Chad Sowash is in the house, as we welcome Chris Forman, founder and current/outgoing CEO of Appcast. Chris, welcome to HR's Most Dangerous Podcast.
Chad: It's the only way he'd come on the show.
Joel: Yeah. He's going out in a blaze of incompetence on coming on our show. [chuckle]
Chris Forman: No, guys. As I consider all the things that have happened in my career, I realize that there was a giant puzzle piece missing.
Joel: A void. [chuckle]
Chris Forman: And before, there was an emptiness. And so before I step away, I had to make sure that I checked all the boxes and...
Chad: There's a hole in his heart.
Joel: As he is laying on his bed of cash, he's thinking, "What does my life need?"
[laughter]
Joel: What am I missing in my life?" A little Chad and Cheese time.
Chad: "I don't have enough idiots in my life. I need some Chad and Cheese."
Joel: Well, Chris, some of our listeners will not know you, may not even know Appcast. Give us the elevator pitch on you and the business before we get into the Q&A.
Chris Forman: Yeah. My name is Chris. I've been married to Angela for 31 years. We live on a dairy farm in upstate New Hampshire. Yep. Yep. Cows. And we have Guernsey cows, which, the cows right here, my grandfather raised them in Northern Ireland. And, let's see here, what else? We got four kids, two married, I'm a grandfather. We got two boys in the army. We got one 16-year-old left at home, and she's fantastic. And, life is good. We moved to New Hampshire 31 years ago because I married up. Angela is way smarter than me. She...
Chad: Join the club, my friend.
Joel: Yep. Exactly.
Chris Forman: Went to Dartmouth Medical School, which is now called the Geisel School of Medicine. Do you know who Dr. Geisel was?
Chad: No.
Chris Forman: Dr. Seuss. He went to Dartmouth.
Chad: Oh, stop it.
Joel: What?
Chris Forman: Yeah, Dr. Seuss. And so when he died, his wife... Do you know what it cost to get a school name at Dartmouth named after you?
Joel: No.
Chris Forman: $250 million.
Joel: Oh my...
Chris Forman: So anyway, it's now the Geisel School of Medicine. And when we moved up here, pizza was still ethnic food. So, I was like, "Babe, I love you. We're gonna be here for four years in one day." And that was 31 years ago. And now Angela is making cheese and keeping people healthy and...
Joel: When does the Forman Library open up at Dartmouth? Is that...
Chris Forman: Oh my God, no.
[laughter]
Joel: Now that we know the price tag.
Chad: You missed the big one. He made the connection between smartness in our audience with Dr. Seuss.
Joel: There you go.
Chad: He's already threading the needle.
S?: You're not gonna fall for the banana in the tailpipe.
Chad: What's your favorite cheese? You guys make cheese? What's...
Chris Forman: Yeah. So just to be clear, Angela's the farmer and she's the cheesemaker. She makes ricotta. Angela's family is Italian. So if you think about an Irish guy and an Italian, the fights are fantastic, there's all sorts of sparks flying in the air.
S?: I'm happy.
[laughter]
Chris Forman: Cheese update. So she makes ricotta, also makes cannoli, unbelievable cannoli. And my job...
Joel: Oh.
S?: That's winning.
Chris Forman: Yes, winning. Is I go and I sell this stuff at the farmers' market.
Joel: Oh, nice.
Chris Forman: So for the last couple of years, you couldn't get me on Thursday afternoon...
Joel: Do you have a pair of overalls?
Chris Forman: No, no, but I can dress it up.
Joel: The CEO of Appcast at a farmers' market selling cheese.
Chris Forman: Yeah, yeah. It's great. I'm good at it, man.
Chad: Dude, he's in New Hampshire. That's all upscale shit there. It's all upscale.
Chris Forman: I'm good at it.
Joel: That's true. New Hampshire. Well, give us a bit on Appcast.
Chris Forman: I will. But here's one thing. The jobs marketplace... If you're in jobs marketplaces like the jobs business, it's been a tough couple of years, guys. If Appcast and Angela's compounded annual growth rate over cheese sales, I probably wouldn't be retiring. And, there you go. Then maybe we would be doing the library at Dartmouth. Appcast. Appcast is the fourth business in recruiting technology that I've been a part of. It's been a fun one. Founded in 2014, investment thesis was pretty simple. Pay for performance job ads are awesome, unless they're not awesome. Meaning that it's easy to buy a posting that's a duration-based ad, and you give 300 bucks or 500 bucks or a thousand bucks and you get what you get, don't be upset.
Chris Forman: With pay for performance, if you don't manage your campaigns and how much you spend, everything can run away, you get a whole ton of applicants that are on easy-to-fill jobs, none on the hard-to-fill jobs, you throw your budget into a trash can and light it on fire. So we decided to build software that made it easy for recruitment marketers to buy and manage performance job ads. And one of the amazing proof points of occasionally blind squirrel finds nut, the business didn't pivot, it's doing the same thing that it has done for a decade, just at a bigger scale, so now we're just over 500 people. And by objective measures, we buy more job ads and optimize more job ads than anyone else in the world.
Joel: Are you on other places than job sites or, are you on association sites and news sites and that sort of proprietary information, that's your secret sauce?
Chris Forman: Well, it's actually, it's not the... Everybody thinks it's the sites that are proprietary, it's not. This is a funny story. Two years ago, our head of marketing, Heather Salerno came to me and said, "We've been telling people for a long time that our job ads get distributed to 10,000 different sites. Have we checked that lately to make sure that it's true?" And I'm like, "So Heather, are you saying I'm full of shit?" And she's like, "No, no, but sometimes you're expansive."
Chad: But kind of. But kind of. Yeah.
Chris Forman: "So can we check it out?" We ran the data, and this was in 2022. We found out that we ended up getting job ad traffic from 31,000 different places that year.
Chad: Wow. Crazy.
Chris Forman: And we didn't even know it because there's something interesting about the job's ecosystem is, is it tends to be relatively incestuous, like job ads go in lots of... Yeah, yeah, go to different places.
Joel: No shit.
[laughter]
Chris Forman: So yeah. But besides the traditional job marketplaces that we all know and love, there's lots of association sites, but also search, social, so this, the software is smart enough to know that when you've tapped out at a particular level, you can't get more of the type of person that you need, then you start to incrementally go to channels that are more expensive or... So here's... You guys wanna know the secret of why all this stuff really works? It's not the distribution list.
Chad: Sure.
Chris Forman: All right. We track... This is roughly right. It's got an 8 in front of it. Over 80% of the job ads that we buy for employers, we track not just to the apply, but to the hire. And so that signal... So, somebody clicks on a job... We have no idea who the applicants are. Somebody clicks on a job, they go to an applicant tracking system, they apply, we put a tracking code into the ATS, we get that tracking code back, and all that it tells us is candidate is dequeued, candidate is still in the process. Rockstar. And we actually can have it, give us seven different statuses if we wanted them. But it's a... That simple concept is hard to do, but it's a water filter. So when you're hiking, I... Angela and I like to go hike in the White Mountains. There's some long hikes.
Joel: What's hiking? Sorry. What's hiking?
Chris Forman: Yes, I know, it's heavy pack uphill.
Joel: Is that like a quick walk up a hill? Yeah.
Chris Forman: When you run into real hikers, they actually say, "Oh, you're going for a walk." And that typically means you're walking 30 miles up 10,000 feet of elevation. But there are places where you run out of water and so you gotta pull water out of a stream and you don't wanna do that. Giardia is no fun. And so you have a water filter that just pulls the water on out.
Joel: Yeah.
Chris Forman: It is so distilling, because here's the deal in the job ad world, almost every job ad click gets bought by somebody. Okay. The game is buying the right ones. There's that old saw that if you're at a poker table and you don't know who the mark is, it's you. So, in essence what the software that the folks have built is really good at making sure that our clients buy the right traffic and then let others buy the other stuff.
Chad: We'll start thinking more forward-thinking in a minute.
Chris Forman: Yes.
Chad: But I wanna talk about, I think it's important that we take a look at how you started the company and then go to market. 'Cause...
Chris Forman: Sure.
Chad: As we talk to startups and other companies that are out there, they have huge missteps where you guys created the rails for ad agencies to be able to get into this market. So, what was the whole thought process behind that? Because you could have gone direct. You are now, but you could have gone direct at that point, direct to brand, but you didn't. You were like, "Look, we know that there's already infrastructure that's out there, they're called recruitment ad agencies." Right? Then you built the rails for them. Talk about that a little bit from a go-to-market standpoint and why that made so much sense, 'cause obviously it worked.
Chris Forman: Yeah. A lot of times when folks talk to entrepreneurs and they think about why companies are successful, the conventional wisdom is, oh, it's the team. You get the right people in the room and all of a sudden everything happens.
Chad: You're gonna say dumb luck. You're gonna say dumb luck, I can hear it. [laughter]
Chris Forman: No, no, I'm not, but for me that was clearly the case. But if you take a look at the data, timing. If Appcast was founded a year earlier, or a year later, I don't think we would've been as successful as we happened to be. There was this perfect storm of the rise of pay for performance advertising, as well as the desire within the recruitment advertising world to create more fragmentation. So, if you're an advertising agency and all that you do is you buy one thing for your clients, what's your value? If that's all that you do is you are like, "I just go and I buy this, like this one box," and give you the box, clients are like, "Well, okay, well, maybe I can do that by myself." In advertising agencies, it's actually you get rewarded by bringing new ideas, as well as bringing, I guess to use the investing metaphor, a balanced portfolio. You're not putting all your stuff into one stock. And there was this, one of the things that happened when pay for performance came along is it led to this incredible explosion of job sites that were buying and selling traffic from each other.
Chris Forman: And so, they were looking for a solution that would allow them to create higher value products for their customers. And for us, we had this thesis, but it was to build scale, it was a chicken and an egg. You needed money in the system for job sites to wanna integrate and play ball. And you also, to get money in the system, you needed job sites to play ball. And so, it was fairly logical from a startup standpoint, "Okay, we build something, let's go find folks that have a lot of money to spend whose interest are aligned with ours, and were interested in helping us build it." And that's what happened. And so, it made sense. But besides ad agencies, there's been a series of companies over time that adopted programmatic that were transformative. The gig companies came on in. First it was ad agencies, then gig companies, and then all of a sudden you got into e-commerce supply chain. As soon as COVID hit and all, everybody needed to buy stuff in boxes, all that money flowed. And it's interesting, almost at each time, one was starting to wane, the other one would pick up. And so, it was an interesting kind of bridge.
Joel: Why do you rob banks? Because that's where the money is, I think is what he's saying.
Chris Forman: There you go.
[chuckle]
Chris Forman: Yeah.
Podcast Intro: I'm just curious, Chad and I talk critically about job boards fairly frequently on the show. One of us made more than the other. I'm curious, what's your take on the state of the job board business?
Chris Forman: Well, before I came up to the Upper Valley...
Joel: He's choosing his words wisely, I can tell. [chuckle]
Chris Forman: No, I'm gonna... This is an old Forman saw. I was a journalist on Capitol Hill. And the first press conference that I went to, I stayed up all night, I thought up my questions, it was just some podunk congressman's press secretary giving a briefing.
Joel: Yep.
Chris Forman: And I asked the question, she looked right at me and said, "That's a great question," and then proceeded to answer the question she wanted to answer, not the one that was asked. So, let's take a look at this through a couple of lenses. One, the state of the job board industry is it's been a tough couple of years in marketplaces. If you take a look at the publicly available data from publicly traded companies that are in this space, the hangover from the COVID go-go years is real. Whenever there's a retrenchment like that, the good idea fairy gets kicked out of the office and everybody gets back to work. And so, I think what you've seen over the last couple of years is a re-focusing on really figuring out what drives value for clients and doing a lot of that. You've seen big companies in this space decide to go do something and then pull it back or change it. And a lot of that is because it's like, "Hey, these aren't the go-go years where we can expect to grow 20% every year on the top line. We need to make sure that we take care of our customers. We need to make sure that we do the right things by jobseekers."
Chris Forman: So one is, I think there's been a distillation of focus on performance and real business value versus getting out over our skis. Two is, Buffett always says that you never know who's swimming naked until the tide goes out. Well, the tide has gone out and there's been a flight to quality. So, a lot of people that were endeavoring to innovate ways to fill pipelines aren't in that business anymore. And so there's, people's money has been flowing to the people that actually deliver value. Three, the needs of customers, at least at the enterprise level, have changed. So, if you are looking back in the '20s, or 2020, 2021, 2022, the overwhelming business problem that big companies had was volume. I called it the fog spoon business requirement. The only qualification was fog, breathing. And now, that's not the case. It's snap towards efficiency, and you're seeing organizations need less focus on what matters and what delivers value, and rethink their buying patterns. So, those are the big ones. And...
Joel: If the industry was a stock or you buy, sell or hold, let's keep it simple.
Chris Forman: Oh, buy right now. 100% buy. Yeah. Yeah. The overall demographics are on our side. Demands are on our side. And so, there's an argument that says AI is gonna disrupt the need for human capital. That tends to be an...
Joel: Everybody.
Chris Forman: Yeah. That tends to be an argument that's made by people that went to college that work in conference rooms.
[laughter]
Chris Forman: No, I'm... Well, I'm serious. I think that there's always this huge bias towards...
Chad: With a professor before their name. Yeah. Yeah.
Chris Forman: That's right. It's like, okay, well, guess what? An AI can't hammer a nail, or fix a toilet, or at least serve a good hot cup of coffee with a smile. Anyway. But... So that one lens is what's going on in the market and demand and how the organizations are responding. I think you're gonna see some consolidation. Okay. So, if you take a look at what...
Joel: Seeing it now.
Chris Forman: Yeah. JobGet and Snagajob, that was...
Joel: CareerBuilder Monster?
Chris Forman: Yeah, CareerBuilder Monster. Again, you're having a flight towards quality, the stuff that it needs to work through the system is working through the system, and capitalism is a full contact sport.
Chad: Well, I think they ran into innovator's dilemma to some extent, because they didn't continue to innovate, they just sat on the pile of cash that came in. And Indeed flanked Monster and CareerBuilder and Snagajob got flanked by a bevy of other organizations. It's one of the things that we see a lot, not just in our space but in many other spaces. How are you and the kids over at Appcast, how are you going to stop that from happening to you?
Chris Forman: Don't smoke your own press release. And trust me, it's really nice to smoke your own press release sometimes. Yeah.
[laughter]
Chris Forman: That's the point that I was making about people getting back to reality here, is that everybody was brilliant and everybody was smart in 2022 in our space. And now, it's a lot harder to go make a buck. And so taking care of the basics, interestingly, that starts with delivering measurable value. So, when we think about what we do for our customers, performance is number one. Not relationship, not any... It's, we need to be able to show provable performance. Number two, responsiveness. This is an old-fashioned thing, but when a customer picks up the phone, it's, "Yes, ma'am." And you pick up the phone on the first ring and you carry that metaphor through, it's a competitive market. And then the last thing is, is not being not nice. We're all people and it's nice to work with people that you like. And sometimes people just aren't nice in business environments. And I think that's one of the things that people like about Appcast is that, generally speaking, we compete like nobody's business. We play sticks up hockey. We're nice guys and gals, and so that works too.
Chad: So you'll give somebody a bloody lip, but then give 'em a hug after the match, that's what you're saying?
Chris Forman: Yeah. Again, I live in Northern New England, so all my kids were hockey players. We absolutely will check somebody into the board, 100%, and hard, but we don't get thrown in the sin bin very often. And so, that's part of the game. And there you go. One of the things I've relished is coming on the Daily Mail of job boards and talking to you guys about... You guys are pretty tough on Indeed and Stepstone. And...
Chad: Let's get to that. Yes.
Chris Forman: Can I share my perspective on this? All right.
Chad: Oh, please. Oh, please.
Joel: He wants to vent for a little bit.
Chad: Oh, I love it. I love it. Yeah.
Chris Forman: So, Indeed, let's start with Indeed.
Chad: Sure.
Chris Forman: These guys are really, really, really sharp. You talked about organizations that sometimes are very successful, then sit on a bunch of cash and smoke too many of their own press releases and don't necessarily keep up. The reality is, is that the partnership that I and we have developed with Indeed has been good and strong, but they... It's also an environment where sometimes our interests align, sometimes they don't align. But if you ask me who are some of the sharpest cats in this industry, it's these guys. They're thinking around the corner more than most anybody else I know. And so, one of the things that's coming up now is they've created... I talked about the value of Appcast is knowing every click, whether or not it converts to an apply and then to a hire. Indeed's going in the right... In the same direction. They're building pipes to be able to do that. And that's happening at Stepstone as well. But there's only a couple of organizations in the world that have the chops to go do that type of stuff. And if you take a look at where this industry is going, you just have to look at any of the publicly available decks that are out there, everything's moving towards the hire. Why? It's a $33 billion a year business and job ads globally. It's a $330 billion a year if you take a look at this more broadly from staffing. And so I sometimes think that you guys might be a little bit tough. And too...
Chad: It's our job.
Chris Forman: Yeah, I know, I know. Listen, the fourth estate has responsibilities and I get it. As an old journalist, in fact... Oh, hold on. Maybe my press card is here someplace. But...
[laughter]
Joel: He's got his press badge from 1992. Yeah.
Chad: He's gonna pull out a sag after a card next.
[laughter]
Chris Forman: Anyway, I got it. I can't find it.
Joel: Blockbuster membership card. Where's that?
[laughter]
Joel: Where's that, Chris?
Chris Forman: But the... And I get that. And honestly, you guys serve... I'm not joking when I talk about the power of the fourth estate and the role that journalists play and, forcing industries and executives and policymakers to think differently. I think you guys do a really good job, sometimes a little Daily Mail-ish, but good. But now let me talk... You bust the chops out of my friend and boss, Sebastian Dettmers. And...
Joel: Here we go. [laughter]
Chad: We gotta talk about Indeed first. Just because you're sharp, you're a genius, doesn't mean that you're not gonna use that genius for evil, okay? They're squeezing... There's so much shit that they could be doing that they should already be doing. And I mean, you guys too, we should already be a cost per quality candidate. There's no reason for that. If you can go all the way down to the hire, which I will love to have a discussion around why it's stupid for us to actually go cost per hire, because we don't control, other than getting the candidate to the front door. And you want to be able to take responsibility for a shitty hiring manager? That's the dumbest thing I've ever heard, Chris. And then, going back to what Indeed could be doing and they're not doing, they're squeezing the industry. That's all they're doing.
Chris Forman: I disagree.
Chad: Okay. I appreciate that.
Chris Forman: And, while I know some of our customers are unhappy with some of their partners, whether it be Indeed or LinkedIn or Stepstone in terms of like, "I don't like paying this bill." I get that. If you take a look at performance data around what delivers the most efficient value for enterprises in the United States from a hiring standpoint, in the vast majority of cases, it's Indeed.
Chad: I'm not saying they're not dominant. They're using their dominance in a very bad way. That's what we're saying.
Chris Forman: I'm making a different argument. What I'm saying is the data says, they deliver... If they were selling trucks, these would be the longest lasting, most affordable trucks in America. So the data says their product is really, really good. Now, will businesses use leverage if they have it? Of course, I'm not going to apologize or make a distinction there. But here's the other thing I'm gonna say is, Chris Hyams is one of the most ethical, straightforward people I've ever met in my entire career. And I do believe that leaders matter in companies. And so, I've had lots of conversations with him over the years and none of them have been about leverage and driving revenue and power, it's been about trying to do some good work. And so, take it for what it's worth. We're both named Chris, which clearly means that we have a deep relationship. Both of our first daughters are named Emma. So clearly, lots of checkboxes here. But they innovate, they skate hard, they have a product that delivers exceptional value. And the guy that's responsible for running that place is a good dude.
Joel: Now, Chris, if you're gonna go there, let's be a little transparent. Indeed gets a lot of your spend, yes?
Chris Forman: Yeah, because it earns it.
Joel: Okay. Not that you're doing it for a financial gain, but defending them and also, we should let the listeners know that they get a lot of...
Chris Forman: They're close partners. They're close partners. Yeah, but here's the deal. It's like, one of the things that we're doing in the ad agency business, you guys know this, that if you are buying media on behalf of clients, there's a standard commission, it's 15%. You do that. And then, this is an industry-wide practice. Incentives that come at the end of the year rebates based on how much you sell of somebody's stuff. We've never done those. We don't take them. We refuse them. It's in our contract. And so, it doesn't actually matter to me. The money's gonna get spent. The money will get spent because customers have a need. Whether it's Indeed or it's somebody else, I truly don't care. And...
Joel: I just want the listeners to understand that there's a lot of, you said incestual earlier. So...
Chris Forman: Yeah, yeah. Yeah. We're the largest buyer of Indeed, I think in the United States. And so I get it.
Joel: There you go. Okay.
Chris Forman: But I also, we're starting to get to know each other.
[laughter]
Chris Forman: I can be pretty direct.
Joel: No, it's great. It's great.
Chad: We appreciate that.
Joel: Let's talk Stepstone.
Chad: Talk about Sebastian.
Chris Forman: Oh, yeah. Come on. I'm gonna talk about Sebastian.
[laughter]
Chris Forman: Because I respect Chris, but Sebastian's a friend of mine and you guys are pretty hard. So a few things, all the things that I said about Chris, I feel about Sebastian, but he also is just one of the most genuine, nice people. He's also like a complete nutter, awesome power dork. He runs this giant business. He writes books. In fact, best-selling business book.
Joel: Große, it's a dark German book.
Chris Forman: In Germany. Yeah, yeah. [0:24:34.7] ____ It's kind of English and Deutsch, so it's kind of, you know, a slave.
Joel: Big work, something, yeah.
Chris Forman: Yeah, so it's about demographic stuff. He writes mathematical proofs and papers for fun. This guy is just like your best friend from high school...
Joel: I don't know. Are we that tough on Stepstone? I know we have fun with them.
Chris Forman: No, you're not. No, no, you're not. I'm just busting your chops.
[overlapping conversation]
Joel: Indeed we're generally critical, but yeah, Stepstone.
Chad: What I've said on several occasions is I can't understand why a more evolved tech like Appcast is being controlled by a job board.
Joel: Oh yeah.
Chad: That just to me seems backward. It's like dropping a V12, which is Appcast, a V12 engine and a horse and buggy, which is Stepstone. So that to me is what I couldn't understand. Whether he was president or CEO or it didn't matter, it was just the dynamics of they were over you guys. And to me, that didn't make any sense because from an infrastructure and a long-term vision standpoint, we're not going heavy into the duration market, we're going into performance. We're going performance.
Chris Forman: Let's talk about that for a second.
Chad: Yeah.
Chris Forman: So, when we sold in 2019, we sold a big chunk of the business to Stepstone. All right. And the employees, Angela and I kept the rest. And then we created a deal where we could sell the rest of the stock. There's no contract for me to stay. And this is my first rodeo. So, this stopped being about a paycheck a while ago.
Chad: But you love this shit.
Chris Forman: But there's also a reason why I became an entrepreneur. All right. I don't like working for knuckleheads. Right? I mean...
Joel: We don't either.
Chris Forman: Right. Exactly. Your life is too short. So, I'm still here. Now, why am I here? There's two reasons, but one of them is Dettmers. Okay. When you say Stepstone is over Appcast, that is a completely and utterly wrong definition of the relationship.
Joel: Oh, good.
Chad: In the umbrella of how the businesses actually are structured, we're saying Stepstone isn't over Appcast.
Chris Forman: Stepstone owns all of Appcast stock. So...
Chad: Okay.
Chris Forman: And Stepstone is owned by Axel Springer, and Axel Springer is owned by KKR and all these type of stuff. But, what I heard in the question was, "Hey, there's this old-fashioned business and now they're the ones that are owning this thing and that's not cool... " It doesn't work that way. We've got a group of people that spend a lot of time collaborating and sharing ideas. We have total freedom to go do what we wanna do because it's just a different business. And so, I got four kids and the whole, "You're not the boss of me, I'm the boss of you." That...
[laughter]
Chris Forman: It's not junior high. I would also say that the discipline of running a marketplace business is very different than the discipline of running our business.
Joel: I would assume so, yes.
Chad: Especially in Europe. Europe is an entirely different dynamic, entirely crazy different dynamic than the US is.
Chris Forman: And if you take a look at what Stepstone's marketplace business and you look at the marketplaces that have grown in the United States, we've got really big, maybe comedown, all that type of stuff. The dynamic with the Stepstone marketplaces are different, incredible growth, doing really, really well. And so, it may be fair to say that a marketplace business is not the newest business model, but I would argue that in terms of execution and whether or not they're operators, what makes Indeed great? They're operators. What makes Stepstone great is they're operators and they do it really well.
Joel: Why Stepstone? Why 2019? And for critics that say you left money on the table in that deal, what would you say to them?
Chris Forman: Well, and the last part of it is, is that I rolled the vast majority of my ownership and so the business became a lot more valuable. So, it turned out to be a pretty damn good thing.
Joel: Okay.
Chris Forman: And part of the reason why we did 2019 is there was some cap table dynamics, some venture firms wanted to have a big success, it turned out to be a great success for them. And so, there's always reasons why you do a transaction. And remember, I told you that I don't like having knuckleheads tell me what to do.
Joel: Yeah.
Chris Forman: Stepstone aren't knuckleheads and they gave us complete and utter freedom. So in essence, there was, it's like a friends with benefits kind of deal here. We got the deal done. It wasn't a private equity firm, which I'm allergic to, and they've been great and allowed us to be incredibly independent.
Joel: They're not [0:28:55.6] ____ shy's and cops. That's good to know.
Chris Forman: No.
Joel: It's good to know.
Chris Forman: Yeah. Zergut. Yeah.
Joel: Zergut.
[foreign language]
Chad: Joel got his standard Deutsch in for this one. Okay. So let's... So yeah, I get it, Dettmers is a very smart, very good guy, understand that, still understand the dynamics. So when we're talking about all this fun stuff, then you had an acquisition of Bayard in July of 2023.
Chris Forman: Yeah.
Chad: So, big question. And you probably heard us talk about it. Obviously, Recruitics acquisition of KRT, Radancy's acquisition of Perengo. Did those types of moves really force this to happen? Did it force your hand to be able to go in this direction? Okay.
Chris Forman: No. Actually, the reason why we did the acquisition was our customers told us that we needed to.
Chad: How so?
Chris Forman: We specialize in big, big, big companies. So, we don't really sell to people that have less than 2000 employees and most of our customers have 10,000 or more. And when we would be talking to these large companies about using our technology to manage their recruitment marketing spend, the reality is they said, "You guys do a great job. This is awesome. Awesome. We love it. We know that you guys are the best in the world at, let's say, optimizing job ads, but we got 20% of what we do that you guys don't do." And there's some other folks out there that do the whole thing, and they may be less good than you are on this part, but it's one throat to choke. We can just give them everything that we need to do.
Chad: Yeah, but you had all the throats at one time 'cause you were working directly with all the other advertising agencies. So why piss them off and becoming a competitor?
Chris Forman: Well, at the end of the day, we endeavor not to piss anybody off, and I don't think that we did. And I think that we... You can go talk to the folks in the ad agency business.
Chad: Oh, we have, Chris, we have. [laughter]
Chris Forman: We were very straight up and we didn't hurt... We didn't... We have a lot of power, we never use that, and we're all still very good friends. But I believe that Appcast can be not just a good business, and not just a good big business, but a very good, very big business. And the reality is, is that for us to get to that level of scale, you need to work directly with big employers.
Chad: Well then also, at least we've heard, that Stepstone's poising for IPO, grab a portfolio grab like this seems smart to make everything look a little bit more, a little pretty too.
Chris Forman: I don't know and nor could I comment on anything about things in financial.
[laughter]
Chris Forman: But what I... So...
Chad: Okay. Sorry. Sorry.
Chris Forman: The reality is, is that we needed to gain expertise. The clients that Bayard had were blue chip and world class. And then, the other thing is, is just an incredible group of people. As part of our reorganization here, we've elevated a bunch of people into very, very senior roles. And one of the folks that we pick, Andrea Abbott, she's now our chief customer officer, and she was the head of customers service at Bayard. She's just world class. And so we picked up an incredible group of colleagues, great customers. We filled in a patch of weakness for us from a product standpoint. And it's really led to an acceleration of our growth. And it was good. But trust me, all my hair nearly fell out trying to incorporate a 100-year-old company into us and...
Chad: I can't even imagine.
Joel: So I'm hearing, going back to your original statement of diversification, if you were a money monitor. So, I asked you the state of the job board business. What's the state of the programmatic business? Some of the criticism is, it's a race to the bottom. There's so many players. It's just how much margin can you squeeze out of this? The experience isn't great, if I'm citing another criticism with a lot of sites. Which I don't know if you have much control over, but even just some research for this, before this call, I went to CareerBuilder and I clicked on a job that I know was you. Before I clicked on the job, I had to put my info into CareerBuilder. When I clicked on the job, it ultimately took me to a corporate site and took me back to... The point is, I don't think the jobseeker experience is awesome in the current ecosystem of searching for a job. So I wanted to get your take on the state of programmatic, what's it gonna look like in three to five years? How do we improve the user experience? Or do you think it's not broken?
Chris Forman: The user experience for jobseekers is still godawful. It's gotten mildly better with native apply capabilities and also an understanding on the behalf of some employers that there's a direct correlation between jobseeker experience and overall recruitment marketing efficiency. You know like that bing bang boom thing where you have to log into one site, go to another site, they push you over, that's actually, that's the marketplaces themselves doing that type of stuff and that's outside the control that we have. Theoretically, we could have a contractual requirement that says that you don't redistribute our ads. Policing that is sometimes hard, and with some we do that and because they tend to do things that are not great. But with others, it's kind of the coin of the realm a little bit. So there clearly needs, work needs to be done there. On the programmatic side, there's, I think you need to bifurcate programmatic solutions for SMBs and programmatic solutions for enterprises. Really what...
Joel: Say more.
Chris Forman: You can be a job site without being a job site. Let's say I go, in the SMB space, I wanna go and create a little site where you give me $200 and you post your ad with me. I don't run a marketplace. I just take your ad and I go and distribute it to a whole bunch of different places and get people to apply to those jobs and deliver you the applications. That's what I mean by you can be a job site without being a job site. That's super crowded, low barrier to entry, who knows, it's not a space that we're in because it's just not differentiated whatsoever. When you get to the upper levels of using software to buy and manage your performance advertising, there's only a handful of players that can do it. You've got most of the major ad agencies in the United States, a handful in Europe, mostly in the UK, and you've got a couple of pure play providers like us and others that do this for a living.
Chris Forman: But if... It's, the comment that it's super crowded, it's less crowded than you would think. There's not a lot of people that show up on big RFPs or make it down selected when you're dealing with big, big, big companies, just because there's a depth that comes with it. Where's programmatic going? It's going down funnel, 100% down funnel. I agree with you. It is about the idea of paying job sites on a per hire basis, is in its current incarnation, the way the market currently works right now would be unfair because yes, it's at the whim of a hiring manager and an imperfect system. But...
Chad: Unless your system hires them. And you're not, and you're not gonna be there. Or are you? Or are you?
Chris Forman: No. No, no, no, no, no, no.
Chad: Wait a minute, time out. Are we breaking some [0:35:57.3] ____ AI news here?
[laughter]
Joel: [0:35:57.4] ____.
[laughter]
Chris Forman: But what I can tell you is it's really interesting when you look at the data when we track the apply to the quality to the hire.
Chad: Those are all great signals. Right? But they have nothing to do with control. Those are two entirely different things. You can actually manage and make your algorithm much tighter and much better because of those signals, but you have no control over the hire, Chris. So when we start talking about cost per hire, that to me is just somebody who's incredibly naive and doesn't understand what the process really looks like.
Chris Forman: Okay. Well, I may know what the process looks like, so I'm gonna make an argument for...
Chad: I know you do, that's what I'm saying. [laughter]
Chris Forman: I'm gonna make an argument for you. All right? So, [0:36:40.2] ____ Joe always used to tell me that when you have a big problem, you break it into little problems. All right. So, let's break enterprise recruiting into the two most common problems that they have, high volume single profile hiring and one-to-one requisitions. High volume single profile hiring is math. It's total math. Hiring manager deviation...
Chad: It's numbers. Yeah.
Chris Forman: Is so small, it's just math. So, that represents a huge amount of money and spend. Could there be a CPH model for something like that, if in fact you had transparency between the publisher... 100%. Now, if all of a sudden you get into recruiting business consultants that are... Or they're not even in business anymore, boy, am I old, at Deloitte. Okay?
[laughter]
Joel: Enron's back, so yeah.
Chris Forman: Yeah, yeah. Then all of a sudden, like, "Yeah, I buy where you're at." And so arguably maybe that's more of a cost per quality applicant thing, but it's... But what I'm telling you is, it's moving.
Chad: Yes.
Chris Forman: And what it looks like, unsure, but it's going that direction.
Chad: Well, the thing that bothers me about it though, Chris, is that first and foremost that we talk about little problems where we have to move down funnel little problems, not go all the way to the end of the funnel and try to figure out that little problem. So the process, and this next piece of the process, we have cost per click, cost per application. Next one should be, at least in my opinion, cost per qualified candidate.
Chris Forman: Yeah.
Chad: Why have we not gotten that? That in itself should be the next at least big money surge for you guys, 'cause a qualified can's gonna cost a hell of a lot more than just an application. So why haven't we done that if the pile of money's there?
Chris Forman: So, we've had a series of conversations with our clients. The people that want cost per quality tend to also be in the high volume or semi high volume space. So think families...
Chad: Really?
Joel: Oh yeah. Oh yeah. Okay. But then we say, "Okay, that's great. No problem. We can do that for you, but we're gonna price it with a premium." They're already using technology that optimizes to the quality price, the cost, our technology, if you tell us, "I wanna spend this amount for a hire or a quality applicant," we can land on that dime. All right. And then we go to them and say, "If you wanna move from let's say paying per click or per apply to paying for that, we take more risk." Adam Smith says we should get paid more, right? And they're like, "No, no, no, no, no, no. We want what we currently have, that really good price, we just wanna pay you on that. You don't get a premium for taking more risk." And we're like, "No, we're good." So, at a particular level, this is the nuance of it.
Chad: So do you have that product?
Chris Forman: Oh yeah. And listen, a bunch of the programmatic folks with certain clients will say that they are paying on the apply, but the definition of the apply actually is much more of a qualified applicant. So, that does happen.
Chad: So it's somewhat of a pre-screen before you can actually apply in the first place?
Chris Forman: Yeah. Or just, they've got really good knockout questions or, there's enough of a hurdle to go through.
Chad: So why are all of these employers bitching and moaning and complaining about getting way too many unqualified candidates when there's actually options available? Do that just not... Do we need to educate the market more that they are available or what?
Chris Forman: That's a different question. So paying for a quality applicant is different than getting more quality applicants as a ratio. Let's say I sent you a thousand applicants and two of them were quality and you paid me for those. We can do that today. If what you want is two quality applicants from four applicants and only four applicants, that actually is beyond the role that a lot of programmatic platforms do. That really comes down to...
Chad: It's pretty edge case-y, isn't it?
Chris Forman: Well, no, in a perfect world, recruiting should be one applicant, one hire. Sniperville, right, one shot, one kill.
Chad: But you can offer up slates though. And if somebody says, "I wanna pay for 10 qualified candidates and those qualified, here's the qualifications." Boom. And then you can say, "Of course we can, here's 10 qualified candidates."
Chris Forman: For small businesses, yes. But remember, the workflow in big businesses is through applicant tracking systems. What they want is they wanna pay for quality, it goes into the ATS, the ATS just accepts everything. And so you're still gonna have lots of applicants because chaff will come on in no matter how you pay for the applicant.
Chad: Well, you can actually kick them out on the front end just through some basic screening. Can you not? Through the internet applicant rule, if they're not qualified, they're not seen as applicants in the first place.
Chris Forman: But that's in the ATS. And as a programmatic provider, what we do is we take your ads, we put them in places to get people to apply, and we use data to ensure that they're on the right spot. What you're talking about is more akin to a native apply capability that you'd find on a marketplace, which is exactly what companies like Stepstone, Indeed, LinkedIn, are doing, is the reason why native apply they like. Not only do they get higher conversion rates, because they have higher conversion rates, the unit economics of it tend to be pretty darn good for them. They can use better targeting first to put better quality candidates into that funnel to deliver fewer that have higher quality.
Chad: And they force more people to register in their database too.
Chris Forman: Well, yeah... No, no... Absolutely. They talk about data chaff, and so there's chaff that comes out of any process and data is one part of it. This is one of those things where there's a lot of value created for everybody. So, is it coming? Yes. But the second thing that's coming in programmatic is insight. Not analytics. Insight. This is a problem for us. We got more freaking data and we have more analytics than any... It just comes out of our ears. Making it easy to understand about what the right thing to do is, is hard. And so, to give you a very simple example...
Chad: Sounds like a consulting business by the way. Go ahead.
Chris Forman: No. It should be an analytics business. We get asked all the time by our clients, "Does recruitment branding make a difference?" Okay?
Chad: Oh, that's a good question.
Chris Forman: So we're talking billions of dollars are spent on selling your brand, promoting the brand, not direct response. Just to be technical here, it's money spent not on direct response to job ads. And does it work? It's really, really, really, really, really, really hard to prove that. And there's a lot of people that say that they can. We can do part of it, but that's the next big thing because we don't do it great. And I don't think anybody does it great.
Chad: And again, I get that. But the thing is, we are... And I talk to so many leaders in this space who are talking at these great visions of grandeur with PhD papers sitting in front of them, "Why can't we get the little shit done first?" 'Cause that's the stuff that matters. And it just feels like a redirect, Chris, when we start talking about these big things and I love it, don't get me wrong, 'cause we love talking about the future, but the little things, why haven't we gotten those done yet? And you say that...
Chris Forman: What are the little things?
Chad: You're saying that they're on the way. Like the cost per qualified candidate. When is that gonna be a product that everybody could be able to consume readily available for them? Those types of things. And it doesn't have to be that one, but just one that you guys are working on.
Chris Forman: I'd argue, Chad, that in the SMB space, they have a bunch of these slate programs. And in the enterprise space, again, it's more of a, it sounds great on the top line, but again, if you're an employer that already is using technology to optimize your ad spend and you know what your cost per quality applicant is, the idea of paying more for that is actually a little bit hard. This whole premium pricing thing for greater risk is, it's economics and so it's... I don't consider that little. Getting registration pages off of applicant tracking systems, that's little and should be big. But, I think that there's a ton... We talked about $33 billion worth of spending in job ads. I bet 25% to 30% of it... We've improved the efficiency a ton. And when I say we, I mean the people that build software to optimize job ads, not just Appcast. I'd probably say we hit the disruption standard, which is a 30% improvement. I think there's another 30% that we just can't yet measure that whether or not it works. And so...
Chad: There you go.
Joel: Employment branding analytics. Sounds like a perfect product for an agency to go out and sell and an experienced sales team to go sell a product like that.
Chad: I know one of those. Wait a minute. Yeah.
Joel: Chris...
Chad: Yeah. Hold on. I got one question.
Joel: Go ahead.
Chad: Oh, good. When are you two gonna get off the sidelines and go... Found something and go solve some of these problems? All right.
Joel: This is our show.
Chad: I mean, come on.
Joel: We ask the questions.
Chad: Been there, done that.
[laughter]
Chad: Been there, done that.
Joel: Right, Chris, we really appreciate your time. I wanted to get to this. You're leaving the company, you're an outgoing CEO. January I think is your... When you say goodbye. Why step down now and what's next for you?
Chris Forman: I set this date a long time ago. I don't know what I'm gonna do yet.
Chad: Good for you.
Chris Forman: And I am forcing myself to take some time to decompress because I've been doing the same job for 25 years and it's all I know, but I need to go do something that might actually have a chance of downgrading my business class ticket to hell that I've earned as a business person. So...
[laughter]
Chris Forman: I don't know, go teach high school history. Run for...
Chad: Give back.
Chris Forman: Yeah. Yeah. Well, yeah, it's hokey. But I've been super lucky, and the reality is, is I've got some work to do to say thank you for that. But the other thing that I'm doing is I'm spending a lot of time with the next generation of entrepreneurs in our space. Like Katherine Allen at Flo Recruit or Omar at JobPixel or Alex at Kombo. There's some unbelievable talent out there right now doing cool and interesting things.
Joel: Yeah, there is.
Chris Forman: And so, if I can be the gray-haired guy that tells them all the mistakes that I've made, and hopefully they can avoid some of those, that would be great.
Chad: Excellent, man. Thanks for coming on. It's been forever outgoing, incoming, doesn't matter, we're glad to have you, we're glad to have you on the show, man. Thanks so much.
Chris Forman: Thanks, guys. Take care.
Joel: Chris, for our listeners that wanna know more about you or Appcast, where do you send them?
Chris Forman: Well, you can go to appcast.io, it's a website. If you wanna learn about the cheese, you can go to millbridgefarm.com.
Joel: There we go.
Chris Forman: And other than that, I think that's probably the best place.
Joel: I eat all the cheese. Chad, that is another one in the can. Chris, we appreciate your time.
Chris Forman: Thanks, guys.
Joel: We out.
Chad: We out.
Podcast Outro: Thank you for listening to, what's it called? The podcast, the Chad, the Cheese. Brilliant. They talk about recruiting, they talk about technology, but most of all, they talk about nothing. Just a lot of shout-outs to people you don't even know. And yet you're listening, it's incredible. And not one word about cheese. Not one cheddar, blue, nacho, Pepper Jack, Swiss, so many cheeses and not one word. So weird. Anyhoo, be sure to subscribe today on iTunes, Spotify, Google Play, or wherever you listen to your podcasts. That way you won't miss an episode. And while you're at it, visit www.chadcheese.com. Just don't expect to find any recipes for grilled cheese. So weird. We out.