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This blog post first appeared first on old medium publication (https://medium.com/startuprad-io), and was moved to this blog with the relaunch of our website in summer 2024.
Executive Summary
In this episode of Startuprad.io, host Jörn “Joe” Menninger interviews Frederik Fahning, co-founder of Zenjob, a tech-driven temporary staffing platform targeting student employment and flexible work. They discuss Zenjob’s automated job matchmaking, the shift from revenue goals to profitability focus, and the company’s pause on international expansion to prioritize financial stability. Frederik shares insights into Zenjob’s competitive edge through AI, marketing tactics, and the company’s growth, including raising over $100M with aspirations to lead Europe’s flexible work sector. The episode touches on Zenjob’s strategic hiring, potential IPO aspirations, and Frederik’s career journey, including his work with Bitcom and the etymology behind Zenjob’s name.
The Importance of Digital Advocacy: “Bitcom is a number one digital union, if you want, here in Germany and represent huge corporates up to small StartupRadio ensuring, that the politicians don’t forget about us and that they don’t forget about digitization because, especially in Germany, this is often an issue.” — Frederik Fahning | Founder & MD of Zenjob
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Gig Economy and Flexible Jobs: “when it comes to flexible jobs, it’s always very stressful. Also remembering our studies, we did a lot of different kind of student jobs.” — Frederik Fahning | Founder & MD of Zenjob
Introduction
Today we have the pleasure of hosting a thought-provoking conversation with a visionary in the temporary employment space: Frederik Fahning, Founder and Managing Director of Zenjob.
In this episode, we explore the innovative approach Zenjob takes in disrupting the traditional temp job market, focusing on flexibility and automation to cater primarily to students and businesses in need of adaptable staffing solutions. With their tech-heavy platform, Zenjob steers 95% of their job processes fully automated, from matching talent to payment, empowering both workers in search of adaptable schedules and companies with varying staffing demands.
Frederik gives us a glimpse into the journey of scaling Zenjob, sharing insights on the company’s shift from revenue-focused goals to a vision of profitability and solid technological infrastructure, a necessary stride faced with the challenges of 2023. Despite a temporary pause in international ventures, Zenjob’s dedication to becoming Europe’s top flexible work provider has not waned.
Zenjob’s story is also one of adaptability and perseverance. Frederik recounts how the company navigated the unpredictable waves of the COVID-19 pandemic, finding new opportunities in retail, e-commerce, and logistics, while embracing technology with an eye on AI integration and a hopeful gaze toward international expansion in a post-pandemic world.Frederik isn’t shy about sharing the lighter side of entrepreneurship either, as he reveals the behind-the-scenes process of naming the company and even discusses the “worst” name they considered. With over $100 million in fundraising and aspirations that are just as high, Zenjob exemplifies ambition tempered with strategic patience — balancing the possibilities of going public with the pragmatic approach of careful hiring and alignment with core values of being hungry, helpful, humble, and honest.So join us in this enlightening dialogue as we delve into the complexities of the modern labor market, the evolution of work, and the story behind one of Germany’s most promising staffing innovators, right here on Startuprad.io.
The Evolution of Automation in Tech: “Tech is something which is, like, almost like AI nowadays. Right? It’s always a term everyone wants to use and know it’s important and so on.” — Frederik Fahning | Founder & MD of Zenjob
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Business Strategy Shifts of 2023: “Instead of focusing so much on top line as we did before, we were also focusing a lot on profitability and on tech. […] And we continue to do so in 23. So that’s why we now have those technical, advancement advantages like the 95% automation rate.” — Frederik Fahning | Founder & MD of Zenjob
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The Future of AI in HR Technology: “we will always continue, to be, on the forefront, when it comes to HR tech in our in our space.” — Frederik Fahning | Founder & MD of Zenjob
Questions Discussed in the Interview
Can you elaborate on Zenjob’s approach to automating temporary staffing processes and how it sets you apart from traditional temp agencies?
How does Zenjob ensure a good match between businesses’ flexible staffing needs and the students or job seekers using your platform?
What were the key considerations in transitioning Zenjob into a European stock company (SE), and how do you anticipate this will affect your future growth?
As you focus on hiring for specific roles, particularly in product and engineering, what qualities do you look for in candidates to ensure they uphold Zenjob’s values of being hungry, helpful, humble, and honest?
Can you share some insights on how Zenjob adjusted its business strategy during the COVID-19 pandemic to find opportunities in various sectors like retail and logistics?
What are the short-term and long-term impacts of prioritizing profitability and technology before expanding Zenjob’s services?
With the potential of AI integration in your services, how do you envision the future of HR and temporary staffing at Zenjob?
International expansion is a significant step for any company. When the timing is right, which markets or regions does Zenjob aim to target first?
Zenjob has successfully raised substantial funds in the past. What are your strategies for engaging with investors, and how do you balance the need for capital with the desire to remain self-sustaining?
Looking ahead, what are Zenjob’s strategic priorities to become the number one player in Europe for flexible work, and how do you plan to address the labor market imbalance in Germany and across the continent?
Expanding Work Flexibility in Europe: “I think it’s very clear that we really wanna build the number one player in Europe when it comes to flexible work, and, therefore, we wanna internationalize the company again.” — Frederik Fahning | Founder & MD of Zenjob
The Video Podcast is set to go live on Thursday, September 15th, 2024
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Career Evolution during Studies: “You start your studies and you have the 1st, 2nd, 3rd semester. You are maybe are you maybe are looking for those easy jobs for, the events for Rolling Stones concert in Hamburg or, whatever, helping out in in a retail shop. But when you are in the 4th, 5th, 6th semester, and let’s say you study marketing and you wanna work in a Startupradio marketing as a working student, then that should be also feasible via Zenjob.” — Frederik Fahning | Founder & MD of Zenjob
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Labor Market Challenges in Europe: “This is gonna be one of the biggest challenge at least in Germany, but I would assume also in general in Europe. How are we gonna ensure that we have enough employees on the market? We are failing, with, immigration of qualified workers. Now next level, it’s not just gonna be about qualified workers anymore. It’s about workers.” — Frederik Fahning | Founder & MD of Zenjob
The Founder
We have the pleasure of hosting Frederik Fahning (https://www.linkedin.com/in/frederik-fahning-5558b5bb/), the Founder and Managing Director of Zenjob, a tech-driven company revolutionizing temporary employment in Germany. Before taking the entrepreneurial leap with Zenjob, Frederik accrued a wealth of experience in the startup ecosystem and beyond. He has a diverse background that includes studying law, providing him with a solid legal framework beneficial for navigating the complexities of starting and scaling a business. Frederik’s journey into entrepreneurship is rooted in his early exposure to different cultures and working environments, particularly highlighted by his high school experience in the United States, which informed his global perspective and approach to business.
Frederik’s career path is marked by notable stints in various organizations, including Exit Capital Partners, where he gained insight into the financial intricacies of company valuations and deal-making. Frederik also served on the board of Bitcom, Germany’s digital association advocating for innovative digital policies and a thriving ecosystem for startups and corporations alike. During his time at Bitcom and Atlantic Labs, he developed a keen understanding of the digital landscape in Germany, sowing the seeds for what would eventually become Zenjob. His experience across these roles has fed into the vision of Zenjob, striving to create a seamless, balanced, and tech-fueled marketplace for flexible work opportunities, not just in Germany but with aspirations for international expansion. Frederik’s insights into the digital union’s strategic role underscore his broader perspective on digitization’s impact on the future of work and labor markets across Europe.
The Startup
Zenjob (https://www.zenjob.com/en/), founded by visionary entrepreneur Frederik Fahning, has pragmatically carved out a niche in the temporary employment market, specifically targeting the student demographic and businesses with flexible staffing needs. Under Frederik’s steerage, Zenjob has impressively curated a tech-focused approach to job placement, distinguishing the company from its competitors by leveraging heavy automation processes. This edge in technology not only streamlines the hiring process but elevates the efficiency and ease for businesses and job seekers alike. With automated matchings, digital contracts, and a full suite of in-app management tools, the platform boasts a formidable 95% automation rate for job fulfillment. Throughout its growth trajectory, Zenjob has strategically raised upwards of $100 million in funding, highlighting the investor community’s confidence in its business model and growth potential. As a testimony to its success and commitment to future expansion, Zenjob intriguingly transitioned to a European stock company (SE), setting the stage for potential international scalability and future rounds of investment conducive to later-stage investors and private equity.Setting Zenjob apart from conventional temporary staffing agencies is their focus on scalable tech solutions that cater to large corporations, prioritizing specific criteria to solidify the perfect client match. The startup’s foray into the realms of artificial intelligence (AI) and its agile response to the dynamic labor market, especially during the COVID-19 pandemic, underscore its adaptability and forward-thinking. By identifying and capitalizing on the shifts towards e-commerce and logistics, Zenjob adapted to emerging market needs, underscoring its versatility and resilience. The company’s emphasis on the core values of being hungry, helpful, humble, and honest translates into a deliberate hiring strategy, ensuring each team member contributes to their ambitious, yet conscientiously paced growth. With a vision to harmonize the labor market imbalance in Germany and Europe, Zenjob’s future ambitions include international expansion and potentially exploring the avenue of an Initial Public Offering (IPO), all the while maintaining a strong commitment to profitability and technology innovation as it aims to reign as Europe’s top player for flexible work.
European Start-up Growth and Investor Confidence: “But now, also with the US investor on board, we feel very confident also to continue down the mission terms of building at least, the number one player in Europe when it comes to flexible work.” — Frederik Fahning | Founder & MD of Zenjob
Venture Capital Funding
Zenjob is well funded but would take opportunities as they arise.
Corporate Evolution and Future Financing Options: “That’s also one of the reasons why we converted our company at the end of last year to a European stock company and SE to ensure that we have all of the possibilities in the future. Of course, also to ensure that we are a very in a in a very professional setup also when it comes to later stage investors, to private equity, but also to have the opportunity. You know, I think when we started the company, there’s always the romantic idea also as a founder that at some point, you can ring the bell, whether that’s in Frankfurt or on on Nasdaq or wherever in the world it makes sense to ensure to, you know, bring the company to the next level, to open it up also to public markets.” — Frederik Fahning | Founder & MD of Zenjob
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The Interviewer
This interview was conducted by Jörn “Joe” Menninger, startup scout, founder, and host of Startuprad.io. Reach out to him:
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Automated Transcript
Jörn “Joe” Menninger [00:00:00]:Hello, and welcome, everybody. This is Joe from Startupradio. I owe your start up podcast and YouTube blog from Germany as well as the what’s number 1 Internet radio, arc station, StartupRadio, dot radio, the number one program for our tech entrepreneurs. Today’s episode is once again sponsored by StartupRadio raven.com. The best way to get to know and find new investors, You can sign up for early access down here in the show notes. That all said, I would like to welcome the cofounder of Zenjob, Frederic. Hey. How are you doing?
Frederik Fahning | Founder & MD of Zenjob [00:00:37]:Hi, Joe. Thanks a lot for the invitation. I’m doing great, and looking forward for our conversation.
Jörn “Joe” Menninger [00:00:44]:Yes. Of course. As always, before we get into the into talking about what Zendjob is, what Zendjob does, and what it wants to do in the future, let us first talk a little bit about you. I’ve realized you spent a whole year in school abroad when we talked before the interview.
Frederik Fahning | Founder & MD of Zenjob [00:01:10]:Yeah. That’s, that’s correct. 35 years old, born and raised in Hamburg. And, while I was in high school, I had the great opportunity and chance to spend a year abroad, actually, in the US, in New Hampshire, 2 hours drive to Boston. And, I mean, for me, it was a great opportunity because some people in school got able to, you know, go to either UK or to spend some time in New Zealand. And, for me, that was always my dream to go to the US. Was always fascinated also by sports as well as entrepreneurship, actually. My dad, when he was young, also used the opportunity to work for a couple of years, in the US.
Frederik Fahning | Founder & MD of Zenjob [00:01:48]:And, yeah, that’s why I got the chance when I was 17 to spend a year there.
Jörn “Joe” Menninger [00:01:52]:Okay. There there are 2 burning questions right here. Number 1, if you’ve been around Boston, are you now addicted to Krispy Kreme Donuts?
Frederik Fahning | Founder & MD of Zenjob [00:02:01]:I had a couple, but I have to say my love was more for the Boston Celtics, than for the the crispy ones. But, yes, especially the time in Boston as well as in the the the wider range of Massachusetts and New Hampshire was quite quite nice.
Jörn “Joe” Menninger [00:02:17]:I see. And that would have been the second question. What was your favorite team? Boston Celtics, National Basketball Association, NBA ICC. And, then from what I see, you came back and for whatever reason, you studied law.
Frederik Fahning | Founder & MD of Zenjob [00:02:39]:Yeah. I mean, the motivation actually was also a little bit driven by my grandfather. He was Menninger criminals, and he was always a guy I looked up to. And I very much liked the way also he his logic works and how he uses words. And, you know, math was and still is not really my strong suit. That’s also why I thought, 2 birds with 1 stone. Let’s let’s go for this, but always a little bit with the idea to Joe into the economic side of things with a background in law and not so much of being a lawyer or, you know, pursuing a dream there. I still very much have great respect for that, and I also have a lot of friends, actually, who went down that road.
Frederik Fahning | Founder & MD of Zenjob [00:03:17]:But for me, it was always pretty clear that I would love to get the opportunity to be an entrepreneur. But, yeah, that’s why I started in the very beautiful Passau, which is a small city in Bavaria, spending some time in university, but also, spending a lot of times in in the mountains.
Jörn “Joe” Menninger [00:03:37]:Sounds good. And your grandfather, he he apparently was then a criminal trial lawyer. Right?
Frederik Fahning | Founder & MD of Zenjob [00:03:43]:Correct. Correct.
Jörn “Joe” Menninger [00:03:45]:Correct. Okay. I see. And then you started interning, for example, exit, Capital Partners. You have been entrepreneur in residence, with Atlantic Labs. Would I also felt pretty interesting next to your yes. We’re getting there. Next to your job at 10 Joe.
Jörn “Joe” Menninger [00:04:06]:You are member of the board of directors of Bitcom. We do have a vast audience here in the DACH region, but I’m not even sure if most people listening to us here from Austria or Switzerland would be able to say what is Bitcoin. Since you’re a director, can you give us a little introduction?
Frederik Fahning | Founder & MD of Zenjob [00:04:28]:Sure. I mean, this is honestly also something where I was quite glad to join a couple of years ago. Bitcom is a number one digital union, if you want, here in Germany and represent huge corporates up to small StartupRadio ensuring, that the politicians don’t forget about us and that they don’t forget about digitization because, especially in Germany, this is often an issue. And that’s why I was able to spend some time there also in the board. I’m actually not in the board anymore. Something’s something also I think I need to update on LinkedIn where I’m sure you grabbed it from. But we are still in a very good exchange with Bitcom and sometimes joining panels also to represent, obviously, any topic which is related to the future of work. But, yeah, that is the that’s the Bitcom.
Jörn “Joe” Menninger [00:05:17]:That is exactly the point where we are getting to. Originally, when I first heard the name of your company, Zendjob, I was I was thinking some kind of platform where you can hire yoga instructors. How did you come up with that name?
Frederik Fahning | Founder & MD of Zenjob [00:05:36]:That’s actually a good idea. I mean, honestly, we don’t have a job on the platform, but I can imagine also that lots of students would actually very much enjoy this either going to those classes or being an instructor. How did we come up? I think there are two stories to this. So first, there is the very romantic story of us trying to figure out what could be a name, which represents what we have in mind. And that was, when it comes to flexible jobs, it’s always very stressful. Also remembering our studies, we did a lot of different kind of student jobs. I was working for one and a half years in a StartupRadio for very small startup, 5, 6 people for mobile, espresso bars. But then my other cofounder, Fritz, for example, he did a lot of those very classic student jobs, night auditor, at at at a hotel there and then, carrying out newspapers at another day.
Frederik Fahning | Founder & MD of Zenjob [00:06:26]:And then Jian, on the other hand, he was the one, freelancing already in the IT space. So we saw this fairly diverse world of work, but at the same time, every one of us felt this pain. And we wanted to do something where it’s very seamless. You have an app. You just go somewhere. You work there, and everything else needs to be handled. And that’s a little bit where the zen was coming from to be in this balance, and to be in this work life balance. And especially when it comes to easy work, where also sometimes, you know, when you work in a restaurant, the tone might be tough, and you are also very happy.
Frederik Fahning | Founder & MD of Zenjob [00:07:00]:I mean, we can relate to this also, you know, when you’re done with a stressful shift that you come home. So that was the zen in the job. And then secondly, we also wanted to find something which works, international. We started the company also with a vision to internationalize it, and that’s why we very much like Zenjob. The second part of the story, though, is that at some point, you sit there with a list with a lot of different words, and you do a lot of those StartupRadio bingo stuff with Helppondo. And I think Workadoo were other names as well. And Zenjo was on that list as well. And then we also were asking our friends and our first investors what they think.
Frederik Fahning | Founder & MD of Zenjob [00:07:34]:And then also someone was saying, yeah, then why don’t you go for Zenjob? And we said, okay. Thanks a lot. Then someone also pushed us a little bit in the direction.
Jörn “Joe” Menninger [00:07:43]:I I I have one question. What was the worst name you came up for the company? Oh,
Frederik Fahning | Founder & MD of Zenjob [00:07:51]:well, I would say in hindsight, Help Podno, I think, is pretty pretty weak. I don’t remember. I have to grab out the list again. I don’t remember all of them, but Helppondor was for sure something where we laughed a lot about.
Jörn “Joe” Menninger [00:08:04]:Happy you choose Zenjob. My understanding, you you you already hinted it. So it’s not necessarily a competitor of the large platforms or boards where you can post a permanent job for somebody who graduated from university. It’s rather addressing students. How did you come up with this kind of niche idea?
Frederik Fahning | Founder & MD of Zenjob [00:08:33]:Yes. Absolutely right. It’s not a competitor to the deeds or the stepstones, of the world. But when we when we screened, in the beginning where we when we screened what’s out there in, let’s say, like, HR tech or in the HR space, we saw that there are a lot of old players and very young players, StartupRadio, trying to establish themselves, in the classifieds model, in the, commission based model. And, you know, we thought you we can also try, of course, to find our sweet spot there. But what is actually the problem? What we believe is out there. And that’s the one I’d mentioned earlier is about you don’t want to deal with anything. And it doesn’t really matter whether that’s on the b to c side.
Frederik Fahning | Founder & MD of Zenjob [00:09:13]:So as we call them on our talent side, student side, or if it’s on the b to b side for our customers. If it comes to flexible work, if it comes to someone is ill, someone is, on holidays, there’s a seasonal peak Christmas business, summer business. On the b to b side, you just need someone to help you fast, highly automated with good quality. And then on the b to c side, it’s the same thing. You know? You’re sitting there on the weekend and you realize, shit, I actually wanna go, abroad. I wanna go on holidays. I have a present in mind or maybe there’s something is missing for my rent. I really just wanna work tomorrow.
Frederik Fahning | Founder & MD of Zenjob [00:09:48]:And that’s why we were were investigating this space of temp work. So where you do employ the people because we wanted to automate all of the process behind it. And, of course, we also participate we wanted to participate as much as we can within the value chain. And, we saw, again, you have the dinosaurs. You also have a few younger players, but it wasn’t a field where you saw a lot of tech. And that’s why we thought, okay. Let’s start with this very very heavy tech focus, which is also still there after 8 years. And, we went from there.
Jörn “Joe” Menninger [00:10:24]:When I go through your website, I see, for example, job offers in retail on events, and you already hinted like, in restaurants, bars, and so on and so forth. So basically, if I understood it right, just just checking here with you. You are the owner of a bar and somebody calls in sick and he’ll be sick for a whole week, but you have very, very important business or your most important business is done during the weekend. And so you could go post on Zenjob somebody to cover Friday, Saturday evening. Would that be a case where you can use it?
Frederik Fahning | Founder & MD of Zenjob [00:11:05]:That would be a case. That is a case. However, also to be transparent, this is a rare case. So, what’s been happening also the last couple of years, we work with a lot of those huge corporates in, Germany from retailers, food retail, fashion retail, logistic companies, also hospitality, gastro business, and so on. But, of course, we also try to really aim for the sexy big whales, I think, was the name we called them a couple of years ago when we’re trying to identify again our ideal customer profile. And, we very much love to work with those big corporates, of course, also because we’re interested in the share of wallet. But at the same time, yes, your your example is also a case. There is there could be a bar approaching us.
Frederik Fahning | Founder & MD of Zenjob [00:11:51]:I think if it just be 1 bar, 1, employee, 1 talent for 1 shift, once every 3 months, then we probably won’t do it, at least not now. We do look for scale. But, yes, otherwise, you’re you’re you’re absolutely correct.
Jörn “Joe” Menninger [00:12:08]:And who is then your average customer? So you basically sign a contract with, 4 or 5 large logistic companies, and then then they have access to your system and their post, not necessarily Joe, but actual shifts? Is it something like that? Or can you be as an have a student job through the summer also through your platform? What where are the dimensions here?
Frederik Fahning | Founder & MD of Zenjob [00:12:39]:I mean, first of all, I think you would not post it in the classic way of how you would post it also on a on a classifieds model. You would rather enter it in our, company app, company software, in German. Something, basically, where all our automation starts. So what was for us and still is very important, tech. Tech is something which is, like, almost like AI nowadays. Right? It’s always a term everyone wants to use and know it’s important and so on. And we thought 8 years ago, if we really wanna build a new player in that field, then, we really need to keep our focus, which also means sometimes saying no to customers, saying no to potential revenues, because we didn’t invent something new. Temp work is something which has been there already 100 of years.
Frederik Fahning | Founder & MD of Zenjob [00:13:25]:But what wasn’t there before is to have it that tech heavy and that automation heavy. So that means when a company joins Zenjob, they need to accept our company app, and that’s where they would place the potential shifts. We would then give this or put it basically in our system, and the automated matching starts. And algorithm based, we decide who should work there, who’s most qualified, who wants to do the job, what’s the sweet spot, and so on. And when that talent gets matched and the talent applies, we would then say, hey. Yes. Congratulations. You got the job.
Frederik Fahning | Founder & MD of Zenjob [00:13:57]:They would automatically also sign the contract digitally. No interference from our side. Also, the company doesn’t choose the talent. This just happens on very rare occasions because we say, hey, company. If you have those requirements, it’s our job to understand who should come there. And if we do a shitty job, then, of course, you will stop working with us anyway at some point. But you shouldn’t interfere in the middle by saying, you know, for that 1 or 2 shifts, I really wanna select the people. And then the talent goes to the job.
Frederik Fahning | Founder & MD of Zenjob [00:14:25]:They do check-in and check out. They get a rating. They rate the company. They get paid out 50% after 2 days and the rest at the end of the month. All of those steps, they are not just digital, but they’re really automated. So we’re talking about 95% of all jobs run fully automated through our system. So this is where it’s where it’s basically a little bit different, towards what you would see with traditional players.
Jörn “Joe” Menninger [00:14:48]:I see. And what is what is kind of the, the volume we’re talking about here? If you do have, like, a a sexy whale, I like this term, coming to you and how many jobs, or how many challenge, how many people are they looking for for what time frame?
Frederik Fahning | Founder & MD of Zenjob [00:15:08]:Yeah. I mean, this, varies a lot, to be honest. So what we do is when we try to identify if this is an ideal customer for us, then he the customer needs to fulfill a lot of different criteria. Often, it also comes down to the location, for example. If there is a logistic company in the middle of Germany and we don’t have talents there, then we will not do it. It doesn’t help anyone, basically. We can’t promise. If the b to b price is not sufficient, it will be also not helpful because at the same time, we wanna pay good salaries also, to our talents.
Frederik Fahning | Founder & MD of Zenjob [00:15:39]:If the company is, just located in one location, it will be more tricky than if there is a parent company with a 100 or 200 locations. So this is what’s driving the motivation for us to work also with a customer. There is not a specific revenue number or there’s not a specific time frame because with Zenjob, you can actually also come around if you just need someone for 1 shift. But, of course, at the same time, we look at the prospect and what else is gonna be out there for the next couple of months to ensure that we will, that we can do enough revenue with that customer.
Jörn “Joe” Menninger [00:16:11]:I see. And the the the the other side, how do you find the students? Do do you just post on the boards of of the respective universities? Or what’s the approach there?
Frederik Fahning | Founder & MD of Zenjob [00:16:24]:No. We actually invest, most of our talent acquisition cost. They go into, paid, paid marketing. So we are very active on Google. We are very active on, Facebook, Instagram. We are very active in general, like, in social media. But, for us, it’s very heavily driven by paid marketing, actually. We also thought a lot and especially in the 1st 2 or 3 years about what, you know, what about being at universities? What about having the party bus who goes around and, is is, you know, in our, yeah, purple color, driving around doing some little gatherings, parties, and acquiring talents at the same time.
Frederik Fahning | Founder & MD of Zenjob [00:17:01]:But we then realized, you know, this is all beautiful and for the great for the brand. But at the same time, if a talent wants to work, they will enter in Google a site job in Berlin, gastro, and they go and they will look for it. So for us, paid marketing is actually our by far our number one channel.
Jörn “Joe” Menninger [00:17:21]:I see. So you went to do party bus and ended up with Instagram.
Frederik Fahning | Founder & MD of Zenjob [00:17:25]:Yes. And I hope the party bus still comes back because I think, there’s, for sure at least, you know, I would love to see that we invest a little bit here and there again also, in the brand.
Jörn “Joe” Menninger [00:17:36]:Mhmm.
Frederik Fahning | Founder & MD of Zenjob [00:17:37]:But if you are focused a lot on KPIs, what we are, and then focus a lot on unit economics, then the party bus will always, have a it’s it’s tough for the party bus to compete with paid marketing where you just spend a an euro, and you immediately see the exact outcome.
Jörn “Joe” Menninger [00:17:52]:Mhmm. I see. Joe we now get a rough understanding what you guys are doing. In how many cities are you currently present in Germany?
Frederik Fahning | Founder & MD of Zenjob [00:18:03]:We rather call it a region. So we are in 40 to 45 regions. Sometimes, that equals a city. Sometimes, that equals a rather smaller region, Menninger, the surroundings of Munich would be also, you know, allocated to Munich, but you would see us more or less Germany wide.
Jörn “Joe” Menninger [00:18:21]:Mhmm. Okay. I I I found an article about you from late last year, 2023, and you you said you are looking to reach 100,000,000 revenues in 2023. Now 2023 is past it. Did you pass the threshold?
Frederik Fahning | Founder & MD of Zenjob [00:18:41]:Well, I mean, I can comment on that already, but I can say that also, 2023 was obviously also a challenging year for us. That means, instead of focusing so much on top line as we did before, where we were also focusing a lot on profitability and on tech. That started already actually in the beginning of 22, even before Putin invaded the Ukraine. We thought, after 7 years, 6, 7 years of Zen job, you know, it’s really time also about having that shift, having a shift on technology and profitability. And then suck a couple of months later, also, the mindset shifted completely. Right? I mean, this was also crazy to see in this whole start up scale up world and on the VC side, how the investors change the view on growth versus profitability. And we were quite lucky that we kicked off the process before anyway, and we continue to do so in 23. So that’s why we now have those technical, advancement advantages like the 95% automation rate.
Frederik Fahning | Founder & MD of Zenjob [00:19:37]:But I think in top line, there is still something to push for.
Jörn “Joe” Menninger [00:19:42]:Mhmm. I see. So it was a miss. I was I was also wondering when I’ve seen when I prepared for this interview, how have you guys been dealing with the lockdown during corona? This must have been a pretty tough time for you.
Frederik Fahning | Founder & MD of Zenjob [00:20:00]:Yes and no. That means that in the beginning, we lost almost 70% of our revenues, and we were a little bit devastated as everyone was, and we didn’t know where the rest, the revenue is gonna come from. And we’re thinking about here in Germany, a mechanism to ensure that companies can survive and also that employees can survive. But, eventually, this turned around very quickly. And, you know, in the first wave, it was all about the retail. It was all about toilet paper everyone suddenly needed here in Germany. And so we were actually very active, within the retail space, and we were able to compensate also the the loss we had in revenues. Then in the second wave, it was a lot about ecommerce and logistics, which we made a lot of revenues.
Frederik Fahning | Founder & MD of Zenjob [00:20:44]:We also grew from 2020 to 21 by a 150% in revenues. And then in the 3rd wave, we were also very active with with the government. You know? We supported a lot with the vaccination centers, for example. And then we also had gorillas and fling. Joe the the quick commerce, players where we also supported a lot and still are. So, we were actually lucky that, I think our marketplace approach was giving us the opportunity also to adapt very quickly. So, we I would say would even you know, we gained during COVID. We gained revenues, but we gained also confidence, in, the resilience of our business model.
Jörn “Joe” Menninger [00:21:27]:And, I’ve been I’ve been looking what you guys are currently doing, and I’ve been thinking what do you want to do in the future. So I was I was seeing that you already use AI, already is used to evaluate CVs. What will be the future where this is heading? And, of course, curious, will you provide the same service for full time jobs?
Frederik Fahning | Founder & MD of Zenjob [00:22:02]:Yeah. I mean, I think there are 2 things. So because you just raised the point also on AI, I think when it comes to, product and engineering, when it comes to tech, we will always continue, to be, on the forefront, when it comes to HR tech in our in our space. That means, we will, you mentioned already AI also in CVs, a lot of stuff which is happening also within the company. For example, in our customer care unit, we also now, use a lot of AI also to ensure that we scan all the right documents in the right fashion, for example, and, of course, also to improve even the matching of the talents to the jobs. Outside of this, I think, you know, right now, we are also looking a little bit at the macroeconomic climate, and we are very much focused, as I said, on the profitability and, to accelerate growth again and then also to see when the climate is picking up again. And I think when it is, then we were ready and we will be ready again. And what and what that means is that we wanna internationalize the company again.
Frederik Fahning | Founder & MD of Zenjob [00:23:05]:We were we were already international for a very brief period period, in the Netherlands, for example. But then also in late 22, we decided with a focus here on profitability that we will stop this for now, but that didn’t change the ambition to bring this company internationally. We raised over a 100,000,000 also now in fundraising over the couple of years, and I think it’s very clear that we really wanna build the number one player in Europe when it comes to flexible work, and, therefore, we wanna internationalize the company again. We are very much focused on students, but at the same time, we see that this product must be made for everyone, meaning from someone being in school up to a pen engineer, staying at home mom or dad. If you need some money on the side or you just wanna do something, you should have an easy app where you can say, you know, whatever kind of job you wanna do. And then I think lastly, what is also interesting for us, the length of the job and the qualification of the job. So we we already launched a product, have 1 6 months 6 to 12 months ago, which we call Zenjob Pro, where we also offer jobs which have longer duration, meaning up to a year, 1 to 9 months, and not just like the, you know, shift based model if you want. And, that is something we also wanna continue as a value proposition towards the b to c as well as to the b to b side.
Frederik Fahning | Founder & MD of Zenjob [00:24:21]:And, of course, with that also to provide more qualified jobs to make it even more specific, let’s say, you know, you start your studies and you have the 1st, 2nd, 3rd semester. You are maybe are you maybe are looking for those easy jobs for, the events for Rolling Stones concert in Hamburg or, whatever, helping out in in a retail shop. But when you are in the 4th, 5th, 6th semester, and let’s say you study marketing and you wanna work in a Startupradio marketing as a working student, then that should be also feasible via Zenjob. And then you’re done with your studies. And then maybe you also need your your long term commitment. At least for 5 years, maybe you wanna stay at one employer, then that should be also done via Zendjob. So this is rather something which we wanna tackle in the next, let’s say, 2 to 5 years. But in the next, 6 to 18 months, I think it will be still a lot about seeing also, how, you know, everything around us is hopefully changing for the good of it again.
Jörn “Joe” Menninger [00:25:22]:When you would talk about that, I remember from, the beginning of our interview, you told us that only in very rare occasions, the employers actually choosing the talent. Could you see a few years down the road, you hiring people for full time position after university, as you said? Just leaving it to you and not being directly involved in the hiring?
Frederik Fahning | Founder & MD of Zenjob [00:25:49]:It’s absolutely a possibility. I think, you know, one of the things I would think my cofounder also still has it always on his on his wall in his office. The focus is about saying no from Steve Jobs. I think this is something which, as a mantra, we were trying to bring to the company, to We’re talking about the labor market. For us, it’s not also so much about temp work, but it’s really about everything which is more or less related to flexible work to part time work. You’re talking about 50,000,000,000 in revenues in Germany, 500,000,000,000 in revenues within Europe. So this is already quite huge. And, if Zenjob would just, you know, grab a little share of that pie, would be mind blowing.
Frederik Fahning | Founder & MD of Zenjob [00:26:37]:That’s why I think if you ask me now, I think there is enough to do already with the 4 different pillars I mentioned, before. But still, you are completely right. You know, I think that is the thing what we need to see also every year again and again, what is really the best opportunity for us. Where should we go for? What what is the what’s the thing also students are looking for? What’s the thing companies are looking for? Think about this huge problem we are having in Germany also within Europe when it comes to the balance of the labor market. This is gonna be one of the biggest challenge at least in Germany, but I would assume also in general in Europe. How are we gonna ensure that we have enough employees on the market? We are failing, with, immigration of qualified workers. Now next level, it’s not just gonna be about qualified workers anymore. It’s about workers.
Frederik Fahning | Founder & MD of Zenjob [00:27:27]:It’s, not which is already also mentioned by, our different, our government. So, this is gonna be, you know, I think, the the CEO of StepStone, like, a big company from from Germany, which belongs to Menninger similar to Indeed, he was also mentioning that this is gonna be the biggest threat since World War 2 when it comes to economic growth, just the sheer short of of, workers. So I think that is something which is this this overarching theme, which is also driving us and everything which can solve a little bit this problem is something we would go for.
Jörn “Joe” Menninger [00:28:05]:That gives us a pretty broad outline what what I really like and what hammers the point home that you look each year, the 5 year planning Excel sheets are a thing of the past, at least for for companies who don’t have a very steady, very long term business already established. I like that approach. With the approach, you could already, convince 10 investors. As you said, you raised more than 100,000,000 in US dollars. Crunchbase is currently showing it as a little bit over 95,000,000 in euros. And amongst your investors are Atlantic Labs, AXA Venture Partners, Acton Capital, and Red Alpine. Well, some pretty well known names here in Germany in terms of VC investors. Are you guys open with all those plan to talk plan to talk to new investors?
Frederik Fahning | Founder & MD of Zenjob [00:28:59]:I mean, honestly, right now, also with the last round, which was, led by ARAGON, the US hedge fund, which joined our company, which made us also very proud because before, as you said, you know, we had this German, European landscape, which was already great. But now, also with the US investor on board, European landscape, which was already great. But now also with the US investor on board, we feel very confident also to continue down the mission terms of building at least, the number one player in Europe when it comes to flexible work. But, this also, brought us into this very strong position that we are not in the need of money anymore. We, we have a self sustaining business. We have enough money on the bank. And I think if we would go and approach investors again, private equity, if we would work with debt or anything like that, then this will be very opportunistic. This could be something which we would try to leverage for internationalization or, if we wanna really go hard on m and a.
Frederik Fahning | Founder & MD of Zenjob [00:29:52]:Everything related to that, it could be an option again. But I think, otherwise, we feel very confident with this broad, a board of investors as well as money on the bank. And I think that’s why we are always happy to have conversations, but, it’s not anymore like in the early days where we also really needed money from time to time again to ensure to survive. Mhmm.
Jörn “Joe” Menninger [00:30:15]:I see. You have all those investors, and at one point down the road, they are looking to get their money back. In one interview, you talked about an IPO. Is this still a mid to long term goal of yours?
Frederik Fahning | Founder & MD of Zenjob [00:30:30]:It’s for sure a valid option. You know? That’s also one of the reasons why we converted our company at the end of last year to a European stock company and SE to ensure that we have all of the possibilities in the future. Of course, also to ensure that we are a very in a in a very professional setup also when it comes to later stage investors, to private equity, but also to have the opportunity. You know, I think when we started the company, there’s always the romantic idea also as a founder that at some point, you can ring the bell, whether that’s in Frankfurt or on on Nasdaq or wherever in the world it makes sense to ensure to, you know, bring the company to the next level, to open it up also to public markets. There is a great advantage, though, which was, I think, not out there 10 or 20 years ago. The private markets are so heavy with money that if you are successful as a company and you need money, you don’t necessarily need to go anymore, to the public markets to, to open up for new investors. So it is an option. And I think also something, you know, as I said, from a romantic point of view, we still very much like the idea.
Frederik Fahning | Founder & MD of Zenjob [00:31:38]:But I think this will be just something we would judge when it comes to it.
Jörn “Joe” Menninger [00:31:43]:I see. And the last question, actually pretty funny for what you guys are doing are you as Zenjob itself. You have something around 300 employees, I do believe. Yeah. Are you yourself looking to hire great talent in the future?
Frederik Fahning | Founder & MD of Zenjob [00:32:02]:Yes. We do so right now. We do it way more, let’s say, I don’t know, cautious if that’s the right word, but we are more deliberate on what we are doing, who we are hiring. I think also a big learning for a lot of scale ups from the last couple of years is no one wants to end up again also in a situation where you hire too much, and then you realize, revenues or profitability is not going there in the same direction. So that’s why, we do so in specific areas, like in product and engineering. 1 third of our employees are in product and engineering. As I said, right, tech is very important for us. So there’s always something where we will continue to hire.
Frederik Fahning | Founder & MD of Zenjob [00:32:40]:I think right now, we do also, hire in sales, but, this also can change again. Right? This can’t change in a year. Let’s hope this change sooner than later because that also will mean an uprise also in the macroeconomic climate, and then we would look for even a broader range of talents. But right now, we are looking for everyone who’s, you know, eager, hungry. We have, for values here. Also at Zenjob, being hungry, being helpful, being humble, and being honest. So if you fulfill those 4 criterias, right, then please join here on the Joe page and and and check it out, the open positions. But yeah.
Frederik Fahning | Founder & MD of Zenjob [00:33:15]:So this will be, I think, the mix for the next couple of
Jörn “Joe” Menninger [00:33:18]:months. Or, alternatively, you can go down here in the show notes. There’s a link to our blog post, and there we will also link the Sendjob career site. Good?
Frederik Fahning | Founder & MD of Zenjob [00:33:29]:Sounds good.
Jörn “Joe” Menninger [00:33:31]:Frederick, it was a pleasure having you here. Hopefully, we’ll talk in the future again, maybe 1, 2 years down the road, and then see what you did with your tech stack and changing, changes in AI and HR in the future.
Frederik Fahning | Founder & MD of Zenjob [00:33:48]:Sounds good. Thanks a lot, Joe.
Jörn “Joe” Menninger [00:33:50]:Totally my pleasure. Have a good day.
Frederik Fahning | Founder & MD of Zenjob [00:33:52]:You too.
Jörn “Joe” Menninger [00:33:55]:Bye bye.
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