29A – Venture Concept No. 2

Opportunity:

·        A bad hire costs a company $114,000 due to producing a lower quality of work than expected and harming the company’s culture.

·        A company of 100 employees with an average yearly turnover of 10% will lose almost $912,000 a year as a direct result of bad hires.

·        Bad hires are a direct result of a company’s Talent Acquisition team having inadequate skills, inefficient processes, and not properly utilizing their Talent Acquisition technologies that are in place.

·        Companies of every size have the need to hire better. With that said, small to midsized companies, 100 to 1,000 employees, that are experiencing growth are the target customer. They are big enough to have the financial resources to pay for my firm’s services but not big enough to not care about the $114,000 financial hit resulting from a bad hire.

·        The current force growing this need is COVID-19. Companies are laying off employees due to financial difficulties, which will create a lot of openings to fill once the economy rebounds from this recession.

·        The target market is South Florida companies from Miami to West Palm Beach.

·        Customers are currently satisfying this need by having their own Talent Acquisition teams try to improve their hiring, augmenting their current Talent Acquisition team by using external recruiting agencies that focus on plugging one hole in the boat at a time instead of questioning if it is the correct boat to be in in the first place, or completely outsourcing their Talent Acquisition function to an external firm.

·        Eighty-four percent of mid-market businesses South Florida, or for-profit businesses with annual revenue between $10 million and $150 million, and 78 percent of small businesses in South Florida, or for-profit businesses with annual revenue between $2 million and $10 million, are prepared or somewhat prepared to seek out growth opportunities.

·        The immediate window as a result of COVID-19 may last 6 to 12 months. Beyond that, there will be a consistent need for companies to hire better.

Innovation:

·        My firm will provide a wholistic consulting service to companies’ Talent Acquisition departments where we will train their Talent Acquisition team to upskill their capabilities, redesign their processes to make them more efficient and impactful, and help them better utilize their existing Talent Acquisition technologies.

·        My firm’s consultants will spend a 2-week engagement onsite with the Talent Acquisition team. They will start by performing a needs analysis in all three areas mentioned identifying the nuanced opportunities for that specific team, develop customized solutions and lead them through the execution or implementation of those solutions.

·        The 2-week engagement will cost of $38,000.

Venture Concept:

·        My firm will help companies reduce their bad hire rate by 60%, resulting in an initial annual savings of $547,000. The initial direct bottom-line savings and long-term revenue increase from having more productive employees and a better culture are why companies will want to buy my service. It will be somewhat difficult to get a company to buy my firm’s services because it is something they have not done previously, and historical handcuffs are tough to break. With that said, once they see the immediate return on investment and long-term rewards, it will be difficult for them to say no.

·        Some specific competitors offer siloed solutions, but not a holistic solution like my firm. There are consulting firms such as Bain or any of the Big 4 that focus more on operational efficiency gains through technology and processes or with organizational design. There are staffing companies that provide the companies with candidates to hire but do not train the companies on how to hire better. My firm will do all the above.

·        Price points, customer experience, and customer location certainly play a role in defining my business concept. My pricing is a premium and will initially be seen that way before the return on investment is realized. The premium reputation will play into establishing a credible brand in the market. Customer experience will be the most important factor as I will need to leverage each customer for referrals and as references for future customers. Customer location will play a key role initially since I have an established network in South Florida.

·        I’d have a relatively flat organization with my title being Chief Talent Strategist. I would initially hire two Talent Strategists who would report directly to me and would be my consulting partners on the engagement. I would also hire a Business Development Strategist reporting directly to me as well that would be responsible for appointment setting. Additionally, I would hire a Marketing Strategist that is focused on building our brand through an omnichannel approach.

Unfair Advantage: I have an established network of decision-makers in South Florida companies that I can immediately leverage. I would be able to get immediate business and cash flow. The instant success from my network would give me the cushion to expand outside of my network, which would create a sustainable business model.

Next for the Venture: I would work on establishing partnerships with Talent Acquisition technology vendors for applicant tracking systems, AI chatbots, and gamification assessment companies to act in a channel sales capacity.

Next for Me: In 5 years, I would look at identifying other markets to enter, which would be solely based on being able to hire someone with a similar established network and skills in that market as I have in mine. I would also be focused on developing someone under me in the South Florida market that can take over the day to day leadership so that I can focus on the expansion strategy. In the next 3 years, I would focus on growing my business in the new market. Once I have shown it is scalable in other markets and the original South Florida market is still producing at a high-level without my day to day involvement, I would look to sell my firm to a large consulting firm looking to enter the same vertical. At that point, I’d turn my attention to becoming a board member at a fast-growing company that is disrupting the market and needs guidance on how they can hire better.

Summary of Feedback: I really only received positive feedback on my Venture Concept No. 1 assignment. The one sort of question or idea was to try to stay in it longer and hire other people to help me scale it.

How I Changed My Venture Concept: Based on the idea to stay in it longer and scale it, I detailed out more specifics in the "Next for Me" section to show how I would prove the business model works in a new market while also developing someone to lead the South Florida market.