Amid the doom and gloom predictions hovering over the tech industry, Jerome Ternynck is optimistic. That might be partly due to the fact that his startup, SmartRecruiters, is benefiting handsomely from well-timed funding and the changing behaviors of newly remote startup teams.
Ternynck told Business Insider that his recruiting software startup chose not to furlough or layoff employees in March when the economic impacts of the pandemic were still largely unknown. That was a crucial decision, he said, because the company had an 85% increase in sales compared to the same time period last year.
“When hiring volumes are low, it is a perfect time to accelerate the digitalization of recruiting,” Ternynck told Business Insider over email. “This is a trend witnessed in many technology sectors, where the ‘software is eating the world’ principle is being accelerated by COVID and companies having to be bolder in their digital transformation.”
SmartRecruiters was able to capitalize on the moment, Ternynck said, largely because of its financial position prior to the pandemic. In May 2019, the company raised $50 million at a valuation well above $300 million in a funding round led by Insight Ventures. Its returning investors Mayfield and Rembrandt Venture Partners also participated.
The company in February 2019 started exploring raising a Series D funding round and invited prospective investors to attend its annual customer conference to hear the informal case studies and testimonials firsthand, Ternynck told Business Insider at the time.
By March that year, Ternynck said, he was fielding term sheets from a dozen different investors. In the end, he chose Insight, which also led the company’s $30 million Series C in 2016.
“When you get Series D, it really is about the addressable market and the scalability of your solution,” Ternynck told Business Insider. “The problem we are solving is kind of the most important thing businesses do, because who you hire defines everything in the company. The problem is complex in nature and important, and our solution is empowered by tech. Investors like to see that at our stage.”
Late-stage investing is more data-driven, Ternynck said, so he developed a pitch deck that relied heavily on customer statistics and tangible metrics that illustrated the value-add proposition he was pitching.
He said he thinks what resonates with investors “is seeing us being methodical about how we go after that problem.”
“They want to see that you are methodical and now have designed a recipe to acquire customers and renew them at scale,” he said. “All the customer stats were important, so we shared the tangible outcomes so that investors can see where and how we add value.”