Jan Jedlinski: Oh, yeah. I just lost Fred again. Welcome back to the World Staffing Summit and another really great leadership conversation with a great company and a great founder. And that I personally admire Frederick. I hope he will be able to join us here back on stage. In a moment I'm just waiting for him to come back here.
Jan Jedlinski: Here he is. Hey, Frederick. Welcome back.
Frederik Fahning: I'm very sorry. I was just entering a, also never leave again, but
Jan Jedlinski: No worries. No worries. Thanks for joining. Everyone. Thank you so much for joining this session. I'm super excited for this fireside chats. As I mentioned, one of my favorite staffing brands and founders in the industry.
Jan Jedlinski: Frederick is joining me here today. Frederick you, haven't amazed me. You've built an amazing company. I think you one of the coolest staffing brands out there and I know you've been on it for a while already, so you've seen it all, probably some super excited to chat with you about the industry chat about technology in the industry.
Jan Jedlinski: But before we dive in. Maybe you start by telling us a little bit about your journey in the industry and how we actually started Zendjobs and what Zenjobs is.
Frederik Fahning: Thanks, Jan. That's a very warm welcome. And let me know if the audio is fine or not. Otherwise I'm happy also to use the airpods and. Okay, cool. No, of course I'm happy to do so.
Frederik Fahning: We kicked off Zenjobs six years ago here in Berlin. I am actually right now, also in our office. And we are now living in Germany, in the Netherlands and in another country, we are not allowed to talk about yet, but close to Europe, I would say we are in a digital on-demand staffing agency. I think you can call it, but what we are literally doing and what we were trying to change six years ago is that.
Frederik Fahning: Looked at staffing, these staffing industries in general, but. Very much focused from a technology point of view. So what we said is we don't want to build a temp agency or another staffing agency, but we really want to understand what the processes are. We not just want to digitize, but also automate. And we came from the idea by saying, especially when it comes to flexible work.
Frederik Fahning: This is not organized in a fashion that it's seamlessly suitable. And yes, we got the feedback from universities, from retailers, strongest businesses that might make sense. And that's why we kicked it off six years ago. We are now around 350, 350 people here internally at Zenjob.
Frederik Fahning: We're working with 30,000 talents, roughly externally 5,000 companies. And yeah, and we are very happy. That things are picking up and that we can hopefully change a bit, especially when it comes to flexible work, how you perceive it.
Jan Jedlinski: Great. Yeah, I think it's amazing. And we've been in this industry roughly the same time as you are the last five to six years.
Jan Jedlinski: We've been experimenting with different models back in Austria and Vienna. We had a very similar model that we started with and pivoted to a different direction afterwards. But I I totally agree. I'm getting your point where you're going. And I totally see the differentiator that you have with Zenjobs compared to other players in the markets.
Jan Jedlinski: You know, when you look at Zenjob and you look at the traditional staffing business what would you say are maybe the two or three key differentiators? Maybe both from the client's perspective, but also from the candidate's perspective.
Frederik Fahning: Well, I think one aspect we've always very much focused on, especially in the beginning, was actually quality.
Frederik Fahning: That is not a differentiator you will find from a startup versus a traditional staffing agency point of view, but it was always something which was important for us. That's why we also deliberately decided to go for students and later just open it up also for other talents. But I think there are two aspects, which are.
Frederik Fahning: More important when it comes to differentiation between startups and the traditional world is speed and how seamless everything is. So speed. What we can do is basically if there is a hotel retailer around and they need staff in 15 minutes, we will be able to send staff and 50 minutes. Well, what can just because we can have a push notification center or we're a couple of thousands of talents and they immediately can apply and work.
Frederik Fahning: So I think speed is something which is, and was very crucial for us. As a, especially like door opener also to engage on the company side. But even more important. Things needs to be seamless. And you ask like a brown talents and companies. So this is like a B2B and B2C important topic. Meaning we were always focused on building a software, first of all, of course, internally to manage all of the processes, but then two different apps facing our talents, the B2C side, and then also building a company up to face the company side.
Frederik Fahning: In the end, what we have is that we have around 75, 80% of our jobs running automatically through our system. That means if there is a company placing an order, we match the talent. The talent applies. There is a check and check on there's payment, 10th to 14 different operational processes. They are all automated.
Frederik Fahning: No one is interfering, then no one is touching that. And I think that is in the end, the big differentiator as we entered an industry, which was like, I think the number of my co-founder Fritz is referring to was 96% paper driven which was completely crazy for us. And we are happy that we could change some things when it comes to special German topics, when it comes to signatures and crazy topics.
Frederik Fahning: And I hope that we were also able to build something which others can then copy and use.
Jan Jedlinski: Cool. So, you know, the great differentiator that I also see is obviously you guys are a pioneer when it comes to technology and automation and the process. I think, you know, you've nailed that.
Jan Jedlinski: Cause when you look at the market today, A lot of staffing companies are only starting to think of that or only starting to add maybe another automation or another you know, app to their existing applicant tracking system. And I think the big differentiator is that you kind of build everything from scratch with your own technology, as far as I understand, versus using legacy systems.
Jan Jedlinski: So that gives you a great head start. But the second thing that I personally think, which is really great and important, is your brand. So I think, you know, when you look at. The brands that are in the industry today, I think incumbent players can definitely step up their game and, you take a look at what you guys are doing.
Jan Jedlinski: And I think you know, the great differentiator on attracting talent than both candidates is brands. You know, how important is that for you and what type of focus do you put on a brand also going forward.
Frederik Fahning: It's very important. I mean, you said it yourself, technology was always key. That means that we always want it to be perceived also as a technology driven company, that technology is really the enabler or product is core of the experience, again, on both sides of the marketplace and not just a fancy ad on basically.
Frederik Fahning: But at the same time, the brand itself is very important. That's why we were also trying to focus on our brand when it comes to our fairly hyper-local market. Why? Because, I mean, in the end, what we are talking about is that, especially in the beginning, when we attracted students, we are looking at universities and then the semester, and then the group in this semester, or friends who are basically talking around Zenjob, and we were quite proud to see that, especially in Berlin, we very quickly could have adapt a high referral rate, which in the end led to us not spending in any B2C marketing. And I think that is a path we really wanted to grow on. And to establish a brand where people are proud working for which people enjoy, which people see as an enabler, you know, because I think for the whole staffing agency world, this is one of the challenges, right?
Frederik Fahning: We all want and need to be perceived as an enabler and not as a. Yeah. Something which is not seen that well. Right. I mean, we also often talking to politicians, for example, the national level European commission, but also other temp companies. And it's interesting to see how they perceive it. Right. And I think this is something we want to change because in the end there will always be people looking to be directly engaged with one company.
Frederik Fahning: And that is. And then there will be others who enjoy the flexibility to decide when to work for whom and for what. And it doesn't mean that we need to convert all people to one group, it's just a gigantic market and therefore their space.
Jan Jedlinski: I'm just curious what type of skill sets are currently the most common you know, in your network and that you're currently feeling.
Frederik Fahning: Well, we also needed to adapt a bit to the COVID waves we saw so far.
Frederik Fahning: That meant actually that with the first one we lost around 70% of our revenues in a week. And so we needed to adapt quite quickly. And I guess that is also one of the advantages we have as a digital startup. We shifted a lot too. Retail, for example, food retail. I mean, we want you to buy the papers for the bathroom and therefore we had the drug stores, we had the pharmacies, then there was the second wave.
Frederik Fahning: So we switched more to e-commerce and logistics. Then we supported vaccination centers. And with that basically also the skill base changed a bit. I do have to say though, that the majority of the jobs are still helping hands and we are slowly growing up more and more in the verticals also saying, let's say there is a startup and there is a marketing support needed.
Frederik Fahning: And we can supply someone, helping them also then building their career and grow. But if we were first of all, always focused to say we want to understand how the very flexible. And easy work looks like how, and which kind of processes are running in the background that we can then standardize and automate.
Frederik Fahning: And then later we will slowly grow. So I would say our talent pool in general is quite diverse. They rather or needed to adapt always to our offerings. Also due to the pandemic.
Jan Jedlinski: Yeah. You mentioned that one interesting thing you know, supporting people in their careers. I think that's also a great point with your brand.
Jan Jedlinski: And I think that's something that other staffing agencies are really bad at is redeployment. You see actually cases where you have, you know, someone joining Zenjob maybe a couple of years ago, and now. Moving that person from, you know, doing, you know, retail jobs are sort of, you mentioned the helping hand sort of skill set to more, maybe more you know, a third career path.
Jan Jedlinski: Is that also part of the vision to basically help people also further along as they come into your, you know, talent pools?
Frederik Fahning: Absolutely. That is part of the vision, but it's also something we see already happening. Two things I will mention first is that we sometimes hear from the company itself, that they will say, Hey, we really love the talent rule of that student. It is also possible that they can work for us permanently.
Frederik Fahning: And we will not say in that moment, like our, we don't like this or anything like that, but we would rather. Clap and say, you know, great. Maybe even use it as a marketing story, but in general it would be very supportive of that one. Because again, that is not why we don't want to tackle that business. We rather want to understand the people who want to work flexibly.
Frederik Fahning: Yes. So yes, that's something we support. And then we also see that people may start in a certain category, but then they up the letter in the company. The second one is actually internally. So we often have talents we also liking, working for Zenjob, love, loving the brand, and then they will apply just internally at Zenjobs.
Frederik Fahning: And we have lots of talents who actually started working for Zenjobs in Berlin, but also in other cities. And then in a variety of jobs, sometimes in operations, sometimes it's marketing, sometimes legal, right? So there, I think. Brought variety and yes, part of the vision though, is to go very much further in that direction.
Frederik Fahning: We believe into investing into our talents, into draining to qualifications, actually, that also applies to every employer nowadays. Right. But of course, we need to do this too, to also showcase that you can go very far with Zenjob. And when you then decide to do something else permanently.
Jan Jedlinski: Perfect. Let's shift back a little bit to technology.
Jan Jedlinski: I had an interesting conversation with Tim from Kelly, digital X just a couple minutes ago. And we were talking about, you know, recruit less. World right, everybody. The last couple of years is talking that most staffing agencies will be replaced. You know, AI is coming in, it feels to me like this conversation is going on.
Jan Jedlinski: And it never really happens. You mentioned that, you know, the majority of your jobs today already. Basically are being matched with candidates and your pool pretty much without the help of a recruiter or sourcer. How do you see that evolving in the next couple of years? Do you see the recruiter playing a role here as sort of a talent curator?
Jan Jedlinski: Or do you see the recruiter going away completely?
Frederik Fahning: Well, I believe that we will see something we often see now in lots of different departments in the working world, there will be standardized processes. There are standardized processes. And those are the processes you were just talking about curating, for example, which in the future, and maybe in the very near future is not something that.
Frederik Fahning: Deal with any more. And I also don't believe that's the great asset of a recruiter, right? The greatest asset of a recruiter is to understand already in detail, how is that human being on the other side? How do they tick? And also understanding very much the hiring manager internally understanding how they tick?
Frederik Fahning: Because you know, often you have this job description and you also have the internal. I don't know, let's call it a memo where a recruiter will ask you, like, what are you looking for and so on. But then there's always so much stuff between the lines and you just realize this by working with each other.
Frederik Fahning: And if you have a good recruiter, they get you and they already understand those in between lines. And I think that is exactly something we will not automate in the near future, at least. Right. We all don't know what's going to happen in the distant future. But what we will automate is the curating.
Frederik Fahning: The high level of screening, the going through category, scraping the net, scraping LinkedIn and things like that to understand, okay, where this group is coming from, because I think the pure sourcing part is not something which is a great asset of the actual recruiting process itself.. But in which comes after all, especially when it comes to a good recruiting process itself.
Frederik Fahning: Right? I mean, this is also something where we spend a lot of time on to understand how we want our recruiting to happen and how many interviews, right? How is the experience at the interview? All of those little things. And I think that is something where human interaction will still play a great part.
Jan Jedlinski: Yeah, I'm also personally interested. You know, I know that you've been on this for the last five to six years. You know, what were the craziest challenges that you had, you know, growing the company and, you know, finding your way through the market, navigating through the existing landscape and ecosystem of you know, providers and grasping everything any interesting stories you can share with us?
Frederik Fahning: Absolutely. I mean, there's a big one which I think is probably going to be too long for this format, but we were almost bankrupt with six weeks left and three weeks left actually. We are in the M&A business with a startup from Berlin, which we were lucky enough to find some venture capital in the beginning.
Frederik Fahning: And we also were always able to. Venture capital later, we'd raised around 50 million. But especially in the beginning, you know, you never really know what's going to happen tomorrow. And there were lots of things going wrong. A fundraising event didn't happen. We have those three weeks left. It was right before Christmas.
Frederik Fahning: So yeah, that was personally quite a vivid time, but a very interesting and special time, if you look from a rather, maybe pure business point of view, I think you know, we, the three of us were three co-founders GM, Fritz, and myself, and we. I didn't have a background in the staffing world. Interesting.
Frederik Fahning: Right. I mean, I come more from a legal point of view. Jan has the tech background and he co-founder two companies and Fritz has a commercial view, but in the end, all three of us, we didn't have a background. So it's quite cocky, you know, to come into this industry and think like, oh, we are now the young hot shots.
Frederik Fahning: We'll have some technologies that's going to work. And we had no idea, but I think in the end, This is really where you need to find your sweet spot. I need to understand where you make your bet. And where do you listen to the experienced people? That is also one of the reasons why we did listen from the early beginnings where we talked to other CEOs of well-established staffing agencies and also hired people with way more experience than we had in the industry.
Frederik Fahning: And I think that helped also, you know, to push us always a little bit over those first barriers like doing your first revenues. We're very scared of that. One or trying to understand is that a B2B price, which you can really set through? Is that too bold? Not too bold. So I think in that sense, we obviously learned a lot over the time and what we did learn maybe is, you know, you just need to do it and need to try, need to push for it and you will learn it anyways.
Frederik Fahning: People will always tell you, no, that's not going to work also from the customer side. Right. They will say, I have lots of other staffing agencies and they can do whatever. We did it to figure it out on our own and we fail every day. So it's all good.
Jan Jedlinski: Good, great learning. I totally agree with that also from a customer's perspective, right?
Jan Jedlinski: It's quite hard to get into the conversation probably. Yes. Essentially you know, a lot of competition in, in staffing, right? So I don't know, 25,000 companies, staffing companies in the US I think more than 30,000, the UK, everybody's saying they have the best talent, right.
Jan Jedlinski: And still, you have to differentiate yourself in some shape or form, but I think you guys did a great job. And I think that also leads back to, you know, quality and brand and obviously technology. When you look at the technology today, do you you know, see a lot of integrations that you guys will be doing in the future with you know, the existing ecosystem, like managed service providers and VMS on the enterprise side what are the longer term vision on, on, on tech, more on the clients, on the client front.
Frederik Fahning: Absolutely. We are actually very much looking into this right now. For example, things like shift planning tools are very relevant for us as we are still focused on flexible work, meaning a couple of days, a couple of weeks, we do also have long-term as a product, but there is still the main focus.
Frederik Fahning: Therefore it is quite essential actually for us also to be integrated in those other tools and platforms then on the next level HRS. So the internal HR systems understand what is that looking at. I think what we really want to achieve on the client side is that we are. Via an API or an SDK and fully integrated module, basically in the end where you asked the hiring manager or the HR manager can understand, oh, something is going wrong here.
Frederik Fahning: There's someone sick. There is a vacation, or I do even have a bit of a longer term. Issue. Well, there's already the integration via central where I can understand who's available. What's the skill? What did they do in the past? What do they want to do in the future? Yes, absolutely. I think this is going to be crucial for us as it is for all of the other platforms, because in the end.
Frederik Fahning: That is something we are all looking for nowadays. We want to have it seamless, right? Everything we do needs to be integrated perfectly. I can see myself basically when I'm doing something and it's not working, then you will get already annoyed basically. So it's the same for the industry. And if we want to convince clients that they use more flexible staff, that they use staffing agencies, then we need to offer the best product possible.
Frederik Fahning: And that's what's driving us.
Jan Jedlinski: Great. And I think it also comes back to this instant gratification, right? Both for the client and also for the candidates, the differentiation that you can really give the clients the option to say who is available now and not have to wait a couple of days before we recruit.
Jan Jedlinski: We'll find it out and call you back. I think that's the big differentiator and I think that's what will also drive the speed in the next couple of years, because people are, now, used to getting everything instantly now specifically, you know, fraud phobics with examples in e-commerce rights.
Jan Jedlinski: I think that habit will just shift over to the B2B sites as well on the buyer side. Let me actually have two more things that I wanted to discuss with you. But maybe we dive a little bit into you know, remote work, you know, I'm just curious, you know, just mentioned before we jumped on the call, you're 350 people and suddenly COVID hits you know, your revenues you know, went down, you know, you had to go all remote.
Jan Jedlinski: How did you manage and what are your secrets to making sure that the company works also with 350 people fully distributed so to say.
Frederik Fahning: The absolutely magic question. If I remember the days, no, two years ago we had an all hands. That means all the team comes together in our office. And there was a Thursday and we were talking already about COVID.
Frederik Fahning: Yeah. Should we do something? And we will. No, it's gotta be fine its way. And then just overnight from Thursday to Friday, we fully changed our strategy by getting everyone in the office on Friday, taking the things and staying home for. Yeah. No. Who knows how long, right? Yeah, I think we also needed to figure out lots of things in the last two years.
Frederik Fahning: I guess we do have an advantage as we are so young as a company and we were running on digital processes anyway, already that it was a bit easier for us probably to adapt to the department. On the other hand, we have people at central, they are between 20 and 35 years old. You know, they're all looking to join the culture, to join the office, to exchange often, you know, they also just go for drinks later in the night as well with the colleagues.
Frederik Fahning: So in the end, that was obviously devastating. I think. Now we are also trying to understand a bit of what are the best practices. We also don't know what the best practices are, and I can also share with you that internally also in the management, we do have the conversations around the topic, because first of all, of course, we also see a great advantage of the new era, right.
Frederik Fahning: And also flexible work engagements. And also we don't see a perspective to be again, For every one, five days in the office every week. On the other hand though, I think we are now sometimes also a bit more extreme on the other side of things, right. We are also praying like how amazing the home office is and working from home as how efficient everything is.
Frederik Fahning: And people often forget those little things like building the culture, having those random exchanges, being a bit creative, all of that. Maybe solving a problem, getting to know someone, and that is not something you will do via slack or zoom or anything like that. You don't do the small chitchat in between.
Frederik Fahning: And I think we are very much convinced to at least write, get back then to a two to three days a culture where you are in the office, then everyone then also should be those days in the office. But we also very happy to learn, you know, I think we're also looking through the big tech companies and I think there were probably lots of things.
Jan Jedlinski: Awesome. When you look at your. Industry news source. Where do you go for, you know, finding out what's happening in the industry? Do you read any industry articles? Do you follow any industry insiders to learn what's happening at the moment?
Frederik Fahning: One actually, which I quite like, I think it's called staffing industry analysts.
Frederik Fahning: It's a newsletter format and Often, very often find actual news, which are also very relevant for us, because I think that is often something which is lacking when it comes to newsletter, formats, anything like that. Of course. On the other hand, we are always trying to exchange with other companies, whether they are startups, like we are our big established companies.
Frederik Fahning: We're always trying to understand a bit of what's going on and what they see as trends. But yeah, if you just ask me from pure sort of new source, then I would mention the staffing industry.
Jan Jedlinski: Any plans actually, to partner with other staffing companies in some shape or form. I know the, you know, M&A market in staffing is pretty hot right now.
Jan Jedlinski: Have you ever considered, you know, potentially acquiring or partnering with other international staffing companies to expand business in that way? Or are you going purely basically on your own? I mean, you don't need to share it, obviously. This is a very insider question, but I'm just curious to hear, you know, or maybe you're writing.
Frederik Fahning: No, of course. I mean, what we did so far also when it comes to international expansion, we always did it organically. So we did it on our own. And I think we also want to continue going down that path, especially because we already saw Germany when we kicked it off, how many things are there to learn?
Frederik Fahning: Like how highly regulated this market is, again, we are really in a temp agency, regulated business world. And that sense. We still see this as a great asset. On the other hand, though, of course now it makes more sense than in the past also to understand are the other companies would love to partner up with, and yes, I think there will be other startups or bigger companies where it makes lots of sense.
Frederik Fahning: I think what we will always trying to understand are two things. Is there a common culture we can bring together? And is there a common understanding of technology? And if those two factors are there, then yes, absolutely.
Jan Jedlinski: Makes sense. When you would give someone that starts a staffing company today, any advice what would you tell them if they started today to think of building a recruiting or staffing business anything you would give them?
Frederik Fahning: I guess what would pop up in my mind is also what, you know, when we looked at the market in the beginning, we were so completely amazed by how gigantic this market is. And I think that is already the danger. So I would then probably say focus also something we were always trying. We said, we want to make students in Germany easy money in the short term.
Frederik Fahning: That needs to be our focus in the beginning. We are fairly broad when it comes to the verticals, but we want to keep it focused for now. And then later it very slowly understands what to open. So I think a focus will be key because there is a niche for everyone. That's why we are also, we are not afraid of competition and no one else should be afraid of us.
Frederik Fahning: It's just, I think, a gigantic market. And you need to understand what your sweet spot is because otherwise I think otherwise you will feel it because the market is just too big and the incumbents are.
Jan Jedlinski: Yeah, I agree. I think I told this on a few other conversations that I had with some industry leaders.
Jan Jedlinski: You have to have a niche in this market, you cannot be a generalist like you know, staffing companies have been in the past, you know, offering everything to everyone and every skill set in every industry you have to build really good brands and focus to make sure that you're able to attract both your clients, but also candidates and retain them.
Jan Jedlinski: And there's a couple of cool other examples. Ultimately, in the US I was mentioned a mom project, and there's a few others. Really great job building a brand. And I think you guys are leading that front in in, in the European market. So congrats on building such a great business. I'm super excited to, you know, keep following your journey.
Jan Jedlinski: See what's going to be, you know, around for you guys in the Netherlands with the new expansion and with other expansions into other cities. So, please keep us posted. I hope we can continue the conversation in a couple months, maybe at the end of the year to check in how is how it's going for you guys.
Jan Jedlinski: And. Frederik, Thank you so much for joining us here today. It was great having you great conversation. I hope the audience enjoyed it. And one last thing when people are looking for you or for ZenJobs, where can they find you?
Frederik Fahning: I think probably the easiest is zenjobs.com. Otherwise LinkedIn also, please just, you know, write me on LinkedIn or whatever we can be helpful.
Jan Jedlinski: Cool. Awesome. Thank you. I appreciate your time today and enjoy the rest of your day. I'll see you soon. And for the audience, stick around, we have great content coming up and enjoy the rest of the conference. See you soon.
Frederik Fahning: Bye-bye.