Original application from Summer 2015. At the time, Fountain was called OnboardIQ.
Company name:
OnboardIQ
What is your company going to make?
OnboardIQ is an applicant tracking system for on-demand companies (like Uber/Taskrabbit).
Our software product makes screening applicants easier for the recruiter by automating the cumbersome tasks: filtering out unqualified applicants, scheduling/rescheduling interviews, running background checks, and sending reminders.
1) Automation is key. On-demand companies don’t care about tracking applicants at an individual level. Their goal is to get as many applicants out the door as quickly as possible, without letting the bad apples slip through the cracks. They need a smart assistant that can administer the high volume of applications. That’s us.
2) Mitigating risk of applicant quality/safety by leveraging our data pool of contractors. We serve as the industry’s bouncer.
3) Developer-centric API. Customers can pass in any type of data they want to collect from their existing forms, use that data to qualify applicants, create metrics, and send them back to their mobile app or CRM.
If this application is a response to a YC RFS, which one?
One Million Jobs
Where do you live now, and where would the company be based after YC?
San Francisco
Founders
Hacker News Username: jjeremycai, Name: Jeremy Cai Hacker News Username: kibaekr, Name: Keith Ryu
Please tell us about an interesting project, preferably outside of class or work, that two or more of you created together. Include urls if possible.
We heard about Snapcash a day after its launch. That same night, we put together a scrappy site (honestsnaps.com) asking people to send $1 to "HonestSnap" and a photo of themselves to receive fashion recommendations.
The next day, Honest Snaps reached #2 on Product Hunt organically. Within three hours of going live, we received a few hundred submissions (and dollars), and were shut down by Snapchat. All proceeds to Women Who Code.
How long have the founders known one another and how did you meet? Have any of the founders not met in person?
We've known each other for 8 months. We met through mutual friends through a young hacker community.
How far along are you?
Our web application is live and powers the supply-side operations for 40 active businesses, including Caviar, SpoonRocket, ZIRX, Sittercity, Eaze, Sprig, Shyp, Managed by Q, Glamsquad, etc.
If you've already started working on it, how long have you been working and how many lines of code (if applicable) have you written?
We started working August 25, 2014 and launched beta in Nov 2014. Sine then we've written 153k lines of code.
Which of the following best describes your progress?
Private Beta
How many users do you have?
40
Do you have revenue?
Yes
How much revenue?
$5k/month
What is your monthly growth rate? (in users or revenue or both)
100% monthly growth in users, and 200% in # of applicants processed.
If you've applied previously with the same idea, how much progress have you made since the last time you applied? Anything change?
We applied previously for the W15 batch.
We got in, but lost a cofounder and the acceptance got deferred as it wasn't best timing. At the time we had just launched our private beta with 3 customers. Since then, our team has continued to push forward relentlessly, and have acquired most of the fastest-growing on-demand companies as customers.
Why did you pick this idea to work on? Do you have domain expertise in this area? How do you know people need what you're making?
Our team is obsessed with automation. We think there’s nothing more life-sucking than repeating tasks manually when they can be processed with software.
While pitching our previous LMS product to companies, we discovered a common painpoint among on-demand companies: their recruiters were spending too much time on administrative tasks. And they were paying heavily for it: a VP at a popular on-demand service told us they were spending $650 per hire for hundreds of hires a week.
We realized that existing solutions weren’t a good fit for the new problems the sharing economy had created, and came up with a solution to relieve the recruiters from time-draining processes. We received validation from every company we’ve talked to (Caviar, SpoonRocket, Homejoy, HomeHero, etc). After one particular meeting, a VP even asked us if we would consider taking seed investment from him because “this just makes sense.”
Keith knows a ton about the HR onboarding space from his previous product. Jeremy has previously worked at on-demand companies Shyp and Game Plan and understands the pain around operations very well.
What's new about what you're making? What substitutes do people resort to because it doesn't exist yet (or they don't know about it)?
There aren’t other products that are designed to sort through thousands of applicants, automatically push applicants through a funnel, and hire hundreds at a time.
Our users currently turn to traditional ATS or Excel spreadsheets. These are good for basic organization, but quickly become too cumbersome at scale. They are suitable more for traditional recruiting where the priority is on finding best talent.
Who are your competitors, and who might become competitors? Who do you fear most?
Direct competitors: PlaybookHR (recently acquired by Intuit)
Industry competitors: traditional ATS like Resumator, Lever, Greenhouse.
Potential competitors: infrastructure companies for the sharing economy, like Checkr (background check), Rickshaw (driver API), NearMe, and ShareTribe (platform as a service). We see them more as awesome partners. We’re currently partnered with Checkr.
Longer term, we see temp staffing agencies as our biggest competitors, but we’re not afraid of them because we will always beat them in technology and cost efficiency.
What do you understand about your business that other companies in it just don't get?
Companies going after commoditized labor need to approach recruitment like high-volume sales. Applicants will easily fall off the funnel if not engaged promptly because to them, it doesn’t matter where they work because the work they do and the amount they earn will be same.
Companies have told us they lose out on a lot of good hires because the process takes so much time, that applicants have already lost interest by the time they get to interact. This makes it important that companies engage applicants fast and persistently.
Labor is following the path of cloud-computing. This is in the sense that people no longer care who exactly is providing the service because the output will be the same regardless.
The future of decentralized labor will bring new challenges, like curating large volumes of labor pools to generate consistent output, matching talent with tasks, and training and monitoring on scalable levels.
How do or will you make money? How much could you make?
We make money on successful hires, similar to temp agencies. We charge $30 for each hire.
An average on-demand company hires 50 workers per city per month. Assuming they are in four cities, this is $6,000/month per customer, which represents $72k/yr in revenue. We estimate larger enterprises like FedEx hire 120,000 contractors each year, of which we can capitalize of 30%, representing $1.08m/yr.
300 startups and 50 enterprise customers represent $75.6m/yr in revenue. This is excluding additional commissions we make from background check vendors.
Longer term we will expand to the contractor staffing market.
Contractor staffing agencies generated $110 billion in 2013, and this market will grow to $160 billion by 2018 (source: AmericanStaffing, StaffingIndustry).
How will you get users? If your idea is the type that faces a chicken-and-egg problem in the sense that it won't be attractive to users till it has a lot of users (e.g. a marketplace, a dating site, an ad network), how will you overcome that?
Referrals have been our biggest way of getting in the door as this industry is tightly-knit. Our customers are very experimental, and are willing to try new methods especially when they branch out to new cities.
Becoming well connected in communities that have many of our target audience will also be important: YC, Sherpa Ventures, Ooga Labs.
Our core product doesn’t face the “chicken-and-egg” problem, so our concern isn’t on getting users. Rather, it’s on retaining them. We face a potential “Heroku” problem, where our product is great for SMBs but as they grow they may seek internally implemented solutions.
We defend this by offering business intelligence based on our data-bank of contractors that no one else has. The labor pool of companies in on-demand marketplaces has large overlap, and we can leverage this in so many ways. For instance, we can compile an industry blacklist, and alert other companies when a shared worker gets flagged from another service. Every company we’ve talked to loved the idea of sharing information about their bad workers in exchange for the same type of info.
These features of our product require a large network of workers, so gaining customers early on to provide this type of intelligence is paramount; we don’t want our customers to become too big before we can provide this service for them.
List any investments your company has received.
Rough Draft Ventures, $25,000, Uncapped, Convertible Note
Was any of your code written by someone who is not one of your founders? If so, describe how can you legally use it.
An offshore developer helped us write parts of the code, but signed a Proprietary Rights Agreement before working with us.
If you had any other ideas you considered applying with, please list them.
1) Heroku for e-commerce businesses: making it super easy to set up a dropshipping business. Giving them all the tools to set up a shopping site, and also creating a marketplace for wholesale partners to partner with new e-commerce businesses for dropshipping. Win-win for both parties: no inventory hassle and more wholesales.
2) Easier application management for Visa, DMV license, certification renewals.
3) Automated compliance consulting: “we see that you are in construction industry with 200 employees, in state of California. Here’s everything you need to do to be compliant.”
Please tell us something surprising or amusing that one of you has discovered.
A lot of people respond “Yes” to “Can you pass a background check” and still fail with flying colors.
What convinced you to apply to Y Combinator?
The support network YC offers. Many of our customers are YC companies and have strongly recommended the program.