SeekOut’s losing the unicorn status
SeekOut’s leadership, CEO Anoop Gupta, and CTO Aravind Bala, articulated the rationale behind this decisive step in a letter to the employees. Acknowledging recent fiscal challenges, they emphasized the necessity of realignment to ensure the company’s long-term viability. This reduction isn’t the first time had to lay-off people; in October 2023, it adjusted its workforce by trimming approximately 7% of its staff. Seekout, once valued at 1,2 billion after their 115M series C funding in January 2022, is now worth far less and losing it’s unicorn status. While there is no shortage of cash in the short term, is there perspective?
Changing of the market dynamics
Insights gained from industry experts like Serge and Shelly from the Recruitment Flex, and Chad Sowash and Joel Cheesman form the Chad and Cheese podcast, offer additional perspectives on SeekOut’s cut-offs and c-level blabla. Chad and Cheese specifically pointed to LinkedIn’s restrictions on data access (X-Ray) as a significant hurdle for companies like SeekOut. Despite denials at SourceCon from SeekOut that the LinkedIn data restrictions have no effect on their data collecting, it appears that they do. Therefore, the recruitment technology landscape is increasingly challenging for firms that rely on external data sources, as LinkedIn has tightened its control over user data, making it difficult for third-party platforms to operate effectively. This impacts all people aggregator firms and the companies that build business on those API’s. Businesses that provide access to ‘talent pools’ of 750M to 1 billion records are more and selling ‘death pools’.
Besides the difficulties that LinkedIn imposes, discussions within GDPR are also raising concerns about using these data pools. With the explosion of fraud, identity theft, and criminal activity within the recruitment space, there are increasing reasons to worry that this kind of business will be prohibited in the coming years to protect the safety of candidates and people with online profiles.
Another reason could be that the market might not yet be mature enough for the advanced technology SeekOut offers, and recruiters are too addicted to their LinkedIn Recruiter Seats. Other companies in similar spaces, such as Restless Bandit and HiringSolved, have already failed. Companies like Eightfold are not turning out to be the unicorns everyone thought they would be. Meanwhile, companies like Textkernel, Daxtra and Intelligence Group are offering more stable and trustworthy talent intelligence solutions that are gaining ground.
Furthermore, the entire recruitment industry, especially the staffing sector, has been experiencing a rough time since 2023. This pain is also being felt by companies like SeekOut. However, the real danger lies in access to fresh data and legislation. These developments are life-threatening. The impact of emerging technologies, such as ChatGPT 5, remains to be seen.
New opportunities
Altogether, SeekOut’s situation and these market developments underscore broader trends and imperatives within the recruitment industry. On one hand, LinkedIn is becoming more protective while also losing sympathy and ground in the market. There is an increasing focus on data protection, GDPR, and risk management among companies. On the other hand, opportunities are emerging in the growing importance of recruitment marketing automation and talent intelligence. The shift from aggregated profiles of people to building relationships with talent and gaining deep insights into behavior will be more sustainable and beneficial for training the LLMs that help you win the war for talent. There might still be a bright future for SeekOut.
