Thoughts from a Venture Capitalist on Software, Software-as-a-Service (SaaS), Cloud Computing, Mobile, Internet and more
Thursday, June 24, 2021
Gloat: the marketplace unlocking workforce potential for Fortune 500 companies
Fun fact: it seems that I end up investing in a cloud HR company every seven years. The first one in 2007 was Cornerstone OnDemand, the second one was Peopledoc in 2014 and the third one is Gloat in 2021. What all of these companies have in common is the ambition to create a category in the HR space: Cornerstone OnDemand pioneered talent management in the cloud, Peopledoc focused on HR Service delivery in the cloud and Gloat is launching a totally new but very high potential platform - an internal talent marketplace that unlocks the workforce potential of large companies.
As companies are in the midst of adapting their teams to be more flexible and take advantage of remote working, new tools are needed to optimise productivity and ensure equality of opportunities. Gloat has pioneered the Talent Marketplace to solve that, and it’s now becoming a strategic tool for global enterprises. Some of the world’s largest, most forward-looking companies are already benefiting from the workforce agility enabled by Gloat’s AI-powered platform. As the company today announces its $57m Series C round led by Accel, I sat down with Gloat’s co-founder and CEO Ben Reuveni to discuss what inspired him to set off on this entrepreneurial journey, how he has seen approaches to talent change in light of COVID-19 and much more…
Please tell us a bit about founding Gloat, and what inspired you to start the company?
I was in Israel’s intelligence unit, surrounded by computer gurus, algorithmic experts, and mathematicians. One day, my boss asked me to spend 10 percent of my time sharpening the algorithm used by the unit to find talent.
It changed my life. This idea of helping people navigate their career and find their true place was what initially planted the seed. And spending 10 percent of my time doing something I loved was exciting and meant I was much happier and more creative in my day-to-day work.
After that, I joined a startup in the storage space, which was acquired by IBM. For the first time in my life, I saw what it was like to be a small employee in a large company – there was no transparency, no visibility, and no agility. It took me ages to initiate anything new. After five years, I decided to see what the next step in my career would be. I had two options – explore outside of IBM, or explore internally.
For some reason, I thought it’d be easier to explore outside of the company, so it was a bit odd when I told the HR department I wanted to find something new inside IBM. They were nervous – they thought I wasn’t happy or satisfied – the whole process was really unstructured.
It was about this time I met my co-founder, Amichai, at IBM. And that made the decision for me. We left IBM and started Gloat with the idea that, by using data and algorithms, we could help people navigate their careers. We created an external talent marketplace where we helped people move between companies, showing them how they could develop their career and move to the next opportunity.
And after this initial idea, you pivoted? Tell us about that.
Right. Almost four years ago, we saw that - about 50 percent of the time - the algorithm showed that the next step for candidates on our platform could be within their current company. This was a lightbulb moment. It inspired us to create the first internal talent marketplace, where we could show these employees that they could find their next career step within their company, and help them navigate their career internally.
Imagine a product where you onboard employees at one end and hiring managers at the other. You let them find each other by using AI and algorithms. We’re controlling every aspect of an employee’s career – whether it’s a part-time project, full-time job, or shadow learning opportunity – we’re trying to show them how they can develop within that company. It was a win-win situation. The company focuses on the employee, and the employee focuses on their career. Everyone’s happy.
Can you tell us a bit more about how it works? Where do you get the data on the employee to understand their skills? How do you get the data on job postings, potential projects, or mentorship requests?
We learned early on that data is key to our success. But in my first meetings with large companies, I was shocked to find that the executives I met – CEOs and CFOs, for example – had almost no data on their employees. But with our internal marketplace, the first thing that provides value to the employees is the onboarding process – they’re providing rich profiles about their skills, experiences, and projects. After they give us these data points, we can show them all the relevant opportunities that exist within the company.
We also learned that, to create a successful live marketplace, we had to understand we weren’t alone in that particular ecosystem. We needed to be integrated with a company’s common platform in order to create a seamless experience for employees and managers. We had to be able to pull information on job openings and career opportunities from all of a company’s data silos in order to create an engaging experience that could be deployed in large companies.
It’s striking that, from the very early days of the internal marketplace, you managed to sign seven figure-deals with very large enterprises from around the world. How did you start building these relationships as a small company in Israel? How do you build that trust and then deploy your solution across their entire employee base?
Large organisations are often misunderstood as being late adopters of new technologies. But I think it’s the complete opposite. We learned that big organisations have big challenges, and they’re looking for partners to help solve them.
The Unilever team, for example, knew they had a challenge. They knew they wanted to break the silos within their talent organisation, and were looking for the right startup to help them do that. Gloat was that startup. We began by establishing a trusted relationship where, rather than a vendor, they saw us as a true partner – we’d learn from them, they’d learn from us. And this mutual relationship led to a successful deployment.
Everyone knows everyone in the large enterprise ecosystem so, after we won our first big client, it was easier to win the second, third, and fourth. Everyone was speaking about the impact and success of our solution. I’m proud that we put so much effort in at the beginning. It was so rewarding in the end.
This was pre-pandemic. COVID really shifted the way people think about work. How did this impact the way people thought about internal talent marketplaces?
I think everyone’s asking that question right now. But the fact is, the world has changed, and it’s not going to be the same as it was pre-COVID.
The impact on Gloat has been interesting. Before COVID, we were telling enterprises how important it was to focus on their internal talent. Then, during the pandemic, companies realised they couldn’t rely as heavily on external resources any more. They needed to focus more on their most valuable assets – the talent within the company. Our clients were asking if we could scale to their entire company within two weeks. So many companies have had to adapt their business models during and post-COVID. They needed to be more agile, and were using our product to reallocate talent from under-utilised to over-utilised departments within their business.
We’re excited about our future. Companies have realised the importance of focusing internally, and we’re seeing that in our pipeline. Rather than a nice-to-have, we’re now essential.
Gloat has grown and hired very fast in the last 18 months. Any tips for other founders going through hyper-growth on how to find and retain the right person, and make sure they’re a cultural fit?
Our entire philosophy is that people are everything. And not just when it comes to creating a product. It’s part of our core culture – from the interview process to the effort we put into understanding if there’s a cultural fit.
Everyone’s working remotely right now, so we’re focusing on connecting people together and creating one team. I do bi-weekly Zoom meetings, for example, where everyone can join and ask questions and give feedback. We’ve also deployed our product within Gloat, creating an internal marketplace that’s helped get people working together on the same project – remotely. In fact, our first live conference was created by a project team put together within our internal marketplace.
To other founders, I’d say it’s time to show you employees they can develop their career within the company – even if they’re working from home. It’s also important for founders to take advice from other CEOs. I like to surround myself with a bunch of successful CEOs and get their advice and perspective on different things.
Being an entrepreneur is hard. How do you cope with the pressure? Any tips on how you organise your time and balance the company, your personal life, and just making everything work?
My secret is my wife. She’s the total opposite of me, and she’s really helped me focus on getting some family time. That’s something I’m always struggling with – especially post-COVID, because we’re all working all the time. But family time’s important to me – the family makes me happy and excited, so I know I’m working for an even greater purpose.