Get started. I'm Doug Anmuth, J.P. Morgan's Internet Analyst. We're pleased to have with us ZipRecruiter, Co-Founder and CEO, Ian Siegel. So ZipRecruiter is a two-sided marketplace, simplifying the job market for both job seekers and employers by leveraging AI-matching technology. It remains one of the largest players in online recruiting. Prior to ZipRecruiter, Ian held executive, product, and tech leadership roles at companies including CitySearch, Stamps.com, and Rent.com. So welcome, Ian. Thanks for having me. All right. For those less familiar with the story, maybe you can just kinda set the stage for what led you to found ZipRecruiter and how the company has evolved over the years. Sure. I started ZipRecruiter after working for multiple early-stage startups where I didn't have somebody to do my recruiting for me. And as a leader of not just a team, but teams, what I quickly discovered was that the process of posting a job to multiple job sites, collecting the candidates, vetting them with a team, was incredibly time-consuming. And the whole time I did, I just kept thinking, "I want a magic button I can push, and it'll send a job to all job sites across the internet, and it'll bring digital versions of all the candidates' resumes in for me to vet and make it easy for me to collaborate with teammates to do so." That's exactly what we built in the original iteration, and it was just one of those electric, immediate product-market fit realities. From the day we opened, we didn't raise money for four and a half years. We bootstrapped. We got to north of $50 million in revenue, with millions in free cash flow, before we ultimately did a $63 million Series A. The reason we raised money is 'cause we reached a point where we realized that volume alone is not the answer. Just getting more and more people to apply to jobs doesn't satisfy what employers are actually looking for, which is a short list of quality candidates. We knew we were gonna start moving into the direction of, at the time, it was machine learning and eventually became deep learning and meta learning, in order to improve the quality of the matches. Once we went for quality, everything took off, and our business has gone public and been public for the last three years, and we continue to have really boundary-pushing deployments of new features that are going to redefine the way that job seekers and employers set their expectations around job sites are going to work. Great. How do you, how do you think you're most differentiated from online competitors? You know, the thing that is true is that if I had a time machine, and I took somebody from 1890, which was the first time an online classified appeared in a newspaper, and I put them on my site, Indeed, LinkedIn, doesn't matter, it would take them less than five minutes to figure out how to use it. That's how little innovation has actually occurred in the online classified space. Our entire product roadmap is designed to accomplish one very simple thing, which is to get job seekers out of the process of searching for work and instead be guided through a matchmaking experience by an expert partner, which is Phil, our AI personal recruiter, who not only helps them look their best to employers by either getting them to punch up their resumes or write a new resume from scratch, but will curate the jobs for which they are most qualified, most likely to be a top-ten candidate, and will even go so far as to pitch these job seekers to employers so that those employers reach out and directly recruit that individual, regardless of whether that person has applied or not. This is just changing the way, fundamentally, the labor market has always worked, and it delights job seekers, and it removes a lot of the thrash that employers complain about, which is getting inundated with unqualified candidates. Okay, maybe you can set the stage a little bit for the current state of the labor market, some of the trends that you're seeing. There's been, obviously softness in the business over the past year and a half, but, hopefully, you can touch on some of the recent signs of stabilization that you're seeing as well. Yeah, I'm sure none of you have heard about the macro at this conference. But the reality is, if you go back to the peak of hiring, which was post-COVID, the reopening of the economy, which was back in 2022, in the peak month, there were 7.5 million people hired in a single month. In March last month of this year, 5.5 million people were hired. And to give you some context on how low that number is, if you go back to 2001, in January, and you look at the dot-com bubble-bursting recession that came on at that point, or you go to 2007, and you look at the Great Recession that kicked off then, there are less hires made in March than in either of those two months. And to further give you context on that, the economy has grown by 60% since then, and there are 20% more people participating in the labor force. There is a stunning swing in the number of people who are getting hired. Fortunately, after what has been a year and a half of macro reality, compressing the overall set of players in the recruiting category, we've started to see signs of a leveling off, that we may be reaching a low point. It's a little bit early to call it convincingly, but we've now had a couple of quarters in a row with positive signal, and we are hopeful that we will find a baseline and be able to grow from there. Okay, great. Organic job seeker traffic was up north of 60% in 1Q. If you can talk about what's driving that traffic and what your focus is on the product side for job seekers? Well, certainly a part of what's driving job seeker traffic is the labor market is tightening again. There are less jobs available, and that's driving job seekers to sites like ZipRecruiter. However, we are experiencing extraordinary job seeker traffic growth that I would say is disproportionate to the rest of our industry. Not only did we grow over 65% in the past quarter, but we were growing consistently over 40% last year, so that 65% is over the 40%. The reason why this is happening is both a combination of excellent product features and strong brand. ZipRecruiter now has 80% brand awareness with job seekers in the U.S., and on top of that, we have the number one-rated mobile app. What makes the app so special, and what makes the job search experience so unique on ZipRecruiter, is again, we have this AI personal recruiter named Phil, who is giving you this white-glove, concierge experience through your job search process. He learns who you are, he learns what you're looking for, and he both guides and assists you in accomplishing that goal, and that has not existed before. Effectively, what we have always asked job seekers to do is sit down in front of a search engine and navigate their way through writing Boolean queries to try and find the jobs for which they are qualified, and that's just a really inorganic experience. So I think a big part of why we are seeing such a surge in job seeker traffic is directly related to the product strategy that we've chosen. How do you keep them engaged, just given the backdrop of this challenging hiring environment? Well, I think part of the reality for job seekers is they both don't know what they're qualified for and don't know what they should be doing. And the great thing about what we're accomplishing with Phil is Phil benefits from the knowledge of all of our systems' past learning. And to be very clear, we have been using machine learning techniques and algorithms for more than eight years, training and retraining against billions of data points, so that we know, not just based on a match between a resume and a job description, who should be talking to whom, but also based on who this job seeker looks like that we've seen before, and which kinds of companies responded positively to job seekers who look like that in the past. And that gives us the wisdom of the crowd, the ability to use insight gleaned from real-world behavior to both inform and improve the recommendations we make, layer large language model-style conversational elements over a software that can do that kind of extraordinary matching, and suddenly you've got software that talks to you and gives you great advice, and I think that's been a really big key to what we've accomplished. Okay, great. Enterprise, major opportunity over time. I think performance revenue is just around 20% of the business today. How do you move that into much higher levers over time, much higher levels? How do you get there? So our revenue is currently split 80% SMB, 20% enterprise, but the labor market in the U.S. is 50/50 split between SMB and enterprise, and we think over the long term, that is the logical balance and split that we will experience with our actual top-line revenue. The interesting thing is, it's really hard to sell to enterprises. There's a bunch of steps you have to complete in order to accomplish it, so most enterprises use an applicant tracking system as their canonical source from which they both post jobs and vet candidates. So we have been going on a decade-long mission to integrate with as many of those as we possibly can. We have now accomplished over 150 integrations with those ATSs, and by doing that, what you accomplish is you make it possible to make it easier for both large companies to activate and initiate campaigns. On top of that, we have also put a bunch of programmatic software in place so that once we understand the goal that a large enterprise has, whatever it is that they are measuring us against or working towards in terms of their TA team's objectives, that we are able to programmatically goal seek that. Then it comes down to a sales force, and we have built that sales force, and are going through the process of engaging with all of these companies. It is a long slog to go through and get all of them signed up to get incorporated into their complex tech stacks, and to train their personnel on one more recruiting solution. But we are well underway. All the pieces are in place, and there is certainly a dampening because of the macro reality that we are all in, but I think we're really well-positioned for when there is either a flattening or the beginning of a rebound. Okay, great. Another business that could be a much bigger contributor over time is international. How do you think about the opportunities there? Over what timeframe could we see greater impact? You know, I really believe that it's not if, but when we're gonna go international, and we look at the opportunity presented by adding additional markets. We're currently in the U.S., Canada, and the U.K., but the most meaningful percentage of our revenue comes from the U.S., and there's just a lot of foundational work that needs to be done in order to elegantly move into these additional markets. So I think that is something that we have circled as a to-do, and it is on the list, and at some point, you will see us do it. Okay. You've shown really strong ability to kind of flex spending, you know, ability to kind of invest into a recovery as well as harvest capital when there's hiring market softness. So for example, last year, revenue was down 29%, but your margins, EBITDA margins still increased by seven percentage points to 27%. So maybe you can just talk about your thought process there, and your general philosophy on kind of leaning in and pulling back, and how you're thinking about that for as things ultimately improve. Yeah, we benefit from a business that runs effectively at 90% gross margins. A huge amount of our costs are variable, and they live in the sales and marketing line item on our expense sheets. So what we are very good at, 'cause we've been doing it for a long time, is measuring from a bottoms-up perspective, the different marketing channels that we deploy, and those measurements are sensitive. So we see downturns coming. We know when upticks begin, and our philosophy is to spend dollars profitably. So when the downturn began, our models let us know, and we started to take marketing down. There's no sense spending basically into a headwind. But we will also, on the flip side, when we see the markets rebound, have very early signal that that is happening, and we will spend aggressively into that. You've actually seen us execute this pattern of behavior a couple times before, but most recently, it was during COVID, where when the economy basically shut down in March 2020, we took spending down radically and immediately. And just a few short months later, in one of the most confusing opportunities I faced in my career, we started to get signal from all our channels that a rebound was occurring, in spite of the fact that there were stay-at-home mandates happening across the country. And so we had to lean in and start spending money aggressively into that, 'cause that's what the data was telling us to do, and we take very much a scientist, not artist, approach when it comes to spending our dollars. You will expect to see us spend into upticks, spend down during downturns, and increase the margin of profitability we have. Over the long term, over the multiple year horizon that when we look at our business, we are confident about getting to 30% margins. We think that's highly achievable. Okay, great. Maybe you can just talk about some of the key areas you're focused on strengthening now, just while the, obviously, the backdrop is softer, just so that you're best positioned to benefit as things get better. I mean, the number one truth of our category is, where go the job seekers, go the revenue dollars. It's been true over and over again. It was Monster and CareerBuilder, and it moved into Indeed, and now we're seeing it happen again, where there is a flight by businesses to solutions that have both depth, meaning that they can fill the frontline worker job, and they can also fill the middle manager jobs, as well as breadth. That means that they can work in every geography, that they can serve every job category. So, you know, ZipRecruiter is, at this point, reflective of the U.S. hiring market. We're at a scale where we are impacted by the macro, in this case, for the worse. But we are very cognizant of how important it is to have a loyal and large job seeker base. That's effectively the inventory that we sell. The only people who pay on our platform are employers, so we wanna make sure that we... You know, it doesn't matter if you build great matching technology, if you have no candidate who actually fits the qualifications that the employer is looking for, or, and no candidate in that geography. So we've been working very hard to increase job seeker traffic, consciously investing a tremendous amount into the R&D for that portion of our marketplace, and so far, the results have been really promising. Okay, great. We'll open up to the audience in a little bit also, if anybody has questions. But Ian, you've about $500 million of cash on the balance sheet. You generate positive free cash flow. How do you think about your capital allocation strategy? I mean, first and foremost, it's organic investments, opportunities that are gonna make the product better or gonna grow one of the sides of our marketplace. Secondarily, it's corp dev, looking at opportunities through acquisition to either add features or functionality that will enhance the product, and/or find adjacent opportunities where we can sell two products for one sales pitch. That has proven challenging, to be fully fair, because we don't just insist on looking for great products, we also wanna find great teams. And so the bar has been high enough that it has been difficult to find companies that would meet that standard. There is, however, you know, downward pressure on valuations, and it's certainly something that we're keeping a close eye on, and we are active players in conversations with many different opportunities. If neither of those are available to us, though, the third thing we do is try to return return on investors' investment into our company, and so we have done over, I can't remember the exact amount, a significant amount of share repurchase, but that is by far a distant third as we look at the uses of capital. And you mentioned, you mentioned M&A, and, you know, that it's, it's more willing perhaps to look at things in this kind of an environment. But do you view those things as more traffic-driven, technology? What, what parts of the market are of interest? I mean, certainly, top-of-funnel participation in either side of our marketplace is deeply interesting to us. Either more employers who are hiring or more job seekers who are looking for work are obvious sorts of tuck-in acquisitions that we would be looking at. But we're also looking at a wide range of company types and functionality, things that could be complementary to our current service, add features or functionality that we could build, but we could simply fast-track by putting them in through acquisition and/or, as I said, you know, adjacent solutions, where you have something that isn't directly on the nose of recruiting, but a close relationship to it, and all of these opportunities are being considered. Okay. I know you talked about the business as being certainly weighted toward SMBs, but how do you think about opportunity, not just to move upmarket and of course more enterprise, but into more, you know, more, you know, kind of environment as well? Yeah, we currently do work and have a large segment of what we consider our enterprise business that is staffing, so we understand how to work with these customers. They have a different profile than a standard enterprise would, but the reality is we're well-positioned and have been doing business with really every company, class, and type that currently recruits at scale. There's just been sort of an extraordinary perfect storm of businesses not opening new jobs and current employees deciding to stay in their current job, and so much of the labor market has been driven by employee turnover in the last two years, that having this sort of Big Stay occur is creating a significantly reduced need for businesses of all sizes to engage in recruiting. So I definitely think the environment is poised for change, and we will have to see what happens, but when it does, you know, we're incredibly well-capitalized. We run a really efficient business model that has a lot of control over the variable costs. We have a really strong brand in a category where brand definitely matters. We have a huge technology advantage. We have billions of data points that we've been using to train algorithms over many years, so that has not only been successfully been deployed, but refined. I just think we're just in a prime position for when the market flattens or turns, to take advantage of all this investment we've made during the downturn. Anything to call out from a marketing perspective? You've always had a you know an interesting marketing strategy and and really one of the early adopters on on podcasts, for example. I think we know kind of how that shifts somewhat in this environment, but perhaps across channels, is there anything that you'd you'd call out in terms of what works really well and you know opportunities going forward? I think the reality of these marketing channels, once you dive into sort of a multi-channel strategy, is that they have variability over time, and different market conditions move certain channels up or down in terms of their efficiency, along with things like the duration of time that you've been inside those channels and how much penetration you have within them. Our understanding of these channels continues to get more and more sophisticated. Our efficiency continues to improve. So I think that the insights to be gleaned from these channels are fundamentally learned by ZipRecruiter already. Mm-hmm. At this point, we're just taking advantage of that knowledge. Okay. And anything you talked to around just paid employer cohort dynamics, just how willingness to pay increases, you know, with time on the platform? Yeah, every cohort that's ever been on the platform, if you look at the average revenue per employer on longer-term cohorts, it just keeps going up, and that makes sense. I mean, employers who are on our platform for more than a year get three times as many great match candidates as scored by our internal matching algorithms, which have, again, been trained and retrained on billions of data points. So the system both leverages the wisdom of the crowd and learns the preferences of these companies and utilizes that to deliver ever more quality matches for the type of jobs that they are posting. The people who use us over the long term pay more because they're seeing the value that they're getting out of what it is that we have to deliver, and we think there's a lot of headroom left in that regard because if you compare us to, say, the offline recruiting landscape, they're still charging an order of magnitude more than we are per hire, and certainly, I think the perception of the value we're bringing is increasing, so... Okay. What do you think the company looks like over the next five to 10 years as you kind of take out the noise of labor market cycles and, you know, just as you drive toward more market share gains and just more secular shift over time? ... I mean, first and foremost, from a product standpoint, I want that time traveler from 1890 to not know immediately how to use my site. Maybe conversational AI will make it so easy that they'll learn this new thing really fast, but, you know, our job is not to build a better job board. Our job is to build a matchmaker. That's how we think about it, and that is how we are oriented. I think if we look out five years, you'll have seen us balance our revenue contribution to be a better reflection of how the U.S. labor market actually works, with enterprise making up a more substantial portion of our revenue. I also think that we will have deployed many innovations into recruiting in general that delight both sides of our marketplace, and that we will both be a marketing and product-driven growth story. Got it. Okay. Maybe one final question. For someone who hasn't been to ZipRecruiter and to the platform in a little while, what would what would surprise them most, in your view? I think the thing that would surprise someone who is looking for work is how they're greeted. The first thing that happens when you come to ZipRecruiter is not that you are presented with a search box and asked to type in a keyword in order to start finding matches on jobs. The first thing that happens is Phil greets you and starts by figuring out the urgency of your search, figures out things like where you wanna work, how much you wanna get paid. We really get to know you now as a candidate, and Phil has been extraordinary. Like, even the simplest version of Phil has been a engagement multiplier everywhere we have put him, and we have started to move Phil more and more into a large language model interface. And where we have done that, the results have been double-digit percentage increases in engagement. So we're really excited about the potential of building this white-glove, curated experience for job seekers and what it represents. I think for employers, I think the thing that stuns them, and actually potentially even confuses them, honestly, is the speed with which they get great candidates. 80% of our employers who post a job on ZipRecruiter get a qualified candidate they could hire within 24 hours, and that's just highly unusual. I think the normal mental framework a lot of employers have is, "I gotta wait till a bunch of candidates come in, and then I'm gonna go through them. I'm gonna vet 'em, and then I'm gonna figure out which ones I wanna phone screen." But our algorithms don't wait. They're impatient. They go instantly, and they try to find the best candidates actively in market who are the closest fit to that job and try to induce that candidate to apply. So I think that the speed with which recruiting can be accomplished is the most surprising thing employers discover when they're on our service. Okay, cool. All right, I think we're gonna wrap up there. Thank you, Ian. Appreciate it.