Many people think of Glassdoor as the website where you can go to check out a potential employer or find out what a company might pay. But the job reviews and salary intelligence site is also the second-biggest job listing site in the country — and just announced it’s being acquired in a $1.2 billion (roughly Rs. 8,000 crores), all-cash deal by the Japanese firm Recruit Holdings, which also owns the biggest jobs site, Indeed. According to news reports, that would make the 10-year-old site, which was reportedly evaluating an initial public offering earlier, one of the largest technology acquisitions this year.
Analysts say the $1.2 billion price tag for Glassdoor reflects a company that sits at the nexus of a number of trends: A tight labour market where many workers have their pick of jobs and employers have to work harder to attract them. A growing demand by recruiters and HR departments in an era of big data to back up their decisions with metrics. And a technological and cultural zeitgeist where an appetite for transparency and accountability have only grown more powerful.
«They’ve heavily disrupted the world of recruiting and talent,» said Kyle Lagunas, an analyst at IDC. «What Glassdoor is bringing to the space is accountability for bad managers, for bad recruiters. We were way overdue for some accountability.»
Analysts repeatedly pointed to what most people think about with Glassdoor — company reviews and salary information — as the reason for the traffic — some 59 million monthly visitors, on average — its site sees. Anyone might visit the site to evaluate a company they want to learn more about — to see if a company has a toxic culture, skimpy benefits or lowballs salary offers — but while there, sees more job listings. That means they stay longer — and have another reason to go there besides seeking a job.
«They provide a single destination where you can find out all these things about the employer,» said John Sumser, principal analyst at HR Examiner, a research firm focused on HR technology. «When you sell job ads, what you’re actually doing, is selling traffic.»
While some analysts expressed surprise by the $1.2 billion valuation, others weren’t surprised to see Glassdoor get acquired, despite earlier rumblings about an IPO. Both Facebook and Google have been getting into the business of job listings, Microsoft bought LinkedIn in 2016, and Randstad announced it was acquiring Monster Worldwide that same year.
«The fear, if you’re not a big player, is one of those other people is going to squash you, and the only way you’ll be able to compete is to pull together a bunch of other assets,» said Brian Kropp, who leads the human resources consulting practice at CEB, which is owned by Gartner.
Hohman said he has always been open to either going public or an acquisition, but the acquisition by Recruit «immediately gives us scale» and speeds up its international presence. Also, he said, «I think Internet verticals inevitably consolidate.»
Over the past decade or so, companies have increasingly used the phrase «employment brand» to describe their image among job candidates and potential employees. Employers, increasingly reliant on talented employees in a knowledge economy, have had to do more to attract the right people. But what started as a wonky H.R. buzzword has become a powerful tool that has now nearly merged in importance with companies’ brand image with consumers, as people increasingly want to know how the companies they buy from treat their workers.
Glassdoor frequently publishes rankings of the best companies to work for and what workers think of their CEOs, which are widely reported in the media. Even if it’s not on purpose, analysts say, it’s a self-reinforcing practice that highlights the importance of that «employer brand» in the marketplace, and helps get the attention of their CEOs.
«There are plenty of companies we talk to where the CEO is acutely aware of their rating on Glassdoor,» Kropp said.
Large employers can spend anywhere from a few thousand dollars to several hundred thousand dollars a year on services from Glassdoor, which include not only job listings but a separate «employer brand» service. It includes a menu of options such as a dressed up, branded website that sits on Glassdoor touting the employer’s mission and values alongside any complaints they get from workers; the ability to keep competitors’ job ads off their Glassdoor web pages; customised web pages for different types of job seekers; and a variety of metrics and analytics Glassdoor can cull from workers’ comments and users’ search habits.
Some analysts said that in doing so, Glassdoor has essentially created a market, one where employers may feel they need to pay Glassdoor for those enhanced web pages and employer branding services to put their best foot forward. An article in The New Yorker about Glassdoor quotes the author of a book about online participation calling it «gentle extortion.» Hohman bristles at that description, saying they let any employer respond to any employee’s review or accusation at no cost.
«I think transparency is an inexorable force in the world right now, and we’ve always felt like this was going to happen no matter what,» Hohman said. «We wanted to do it in a way that was responsible, that was fair.»
He also said companies that are customers do not have any way of influencing the comments on Glassdoor’s site, and that the company takes many steps to prevent P.R. efforts by employers to game campaigns for positive reviews.
Sarah Brennan, CEO of Accelir, which helps companies strategise on H.R. technology, said the scale of Glassdoor’s reviews is big enough that the data in them is not useful only to job seekers — and companies that want to take the complaints to heart and make changes — but by others who are researching companies, whether Wall Street analysts or potential business partners.
«I tell companies to look at Glassdoor even if they’re not looking to work there,» she said. «If you’re about to invest $2 million to $3 million in technology and do it with a company that has an unhappy workplace, that could have an effect on your customers, too.»
© The Washington Post 2018