Day: February 13, 2021

There is infinite money for stock-trading startups

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Ready? Let’s talk money, startups and spicy IPO rumors.

Earlier this week TechCrunch broke the news that Public, a consumer stock trading service, was in the process of raising more money. Business Insider quickly filled in details surrounding the round, that it could be around $200 million at a valuation of $1.2 billion. Tiger could lead.

Public wants to be the anti-Robinhood. With a focus on social, and a recent move away from generating payment for order flow (PFOF) revenues that have driven Robinhood’s business model, and attracted criticism, Public has laid its bets. And investors, in the wake of its rival’s troubles, are ready to make it a unicorn.

Of course, the Public round comes on the heels of Robinhood’s epic $3.4 billion raise, a deal that was shocking for both its scale and speed. The trading service’s investors came in force to ensure it had the capital it needed to continue supporting consumer trades. Thanks to Robinhood’s strong Q4 2020 results, and implied growth in Q1 2021, the boosted investment made sense.

As does the Public money, provided that 1) The company is seeing lots of user growth, and 2) That it figures out its forever business model in time. We cannot comment on the second, but we can say a bit about the first point.

Thanks not to Public, really, but M1 Finance, a Midwest-based consumer fintech that has a stock-buying function amongst its other services (more on it here). It told TechCrunch that it saw a quadrupling of signups in January as compared to December. And in the last two weeks, it saw six times as many signups as the preceding two weeks.

Given that M1 doesn’t allow for trading — something that its team repeatedly stressed in notes to TechCrunch — we can’t draw a perfect line between M1 and Public and Robinhood, but we can infer that there is huge consumer interest in investing of late. Which helps explain why Public, which is hunting up a way to generate long-term incomes, can raise another round just months after it closed a different investment.

Our notes last year on how savings and investing were the new thing last year are accidentally becoming even more true than we expected.

Market Notes

As the week came to a close, Coupang filed to go public. You can read our first look here, but it’s going to be big news. Also on the IPO beat, Matterport is going out via a SPAC, I chatted with Metromile CEO Dan Preston about his insurtech public offering this week that also came via a SPAC, and so on.

Oscar Health filed, and it doesn’t look super strong. So its impending valuation is going to test public traders. That’s not a problem that Bumble had when it priced above-range this week and then skyrocketed after it started to trade. Natasha and I (she’s on Equity, as well) have some notes from Bumble CEO Whitney Wolfe Herd that we’ll get to you early next week. (Also I chatted about the IPO with the BBC a few times, which was neat, the first of which you can check out here if you’d like.)

Roblox’s impending public debut was also back in the news this week. The company was a bit bigger than it thought last year (cool), but may delay its direct listing to March (not cool).

Near to the IPO beat, Carta started to allow its own shares to trade recently, on the back of news that its revenues have scaled to around $150 million. Not bad Carta, but how about a real IPO instead of staying private? The company’s valuation more than doubled during the secondary transitions.

And then there were so very many cool venture capital rounds that I couldn’t get to this week. This Koa Health round, for example. And whatever this news is. (If you want some earlier-stage stuff, check out recent rounds from Treinta, Level, Ramp and Monte Carlo.

And to close, a small callout to Ontic, which provides “protective intelligence software” and said that its revenue grew 177% last year. I appreciate the sharing of the numbers, so wanted to highlight the figure.

Various and Sundry

Wrapping this week, I have a final bit for you to chew on from Mark Mader, the CEO of Smartsheet, a public company — former startup, it’s worth noting — that plays in the no-code, automation and collaboration markets. That’s a rough summary. Anyhoo, I asked Mader about no-code trends in 2021, as I have my eyes on the space. Here’s what he wrote for us:

If you thought the sudden shift to remote work sped up corporate America’s shift to digital, you haven’t seen anything yet. Digital transformation is going to accelerate even more rapidly in 2021. Last year, the workforce was exposed to many different types of technology all at once. For example, a company may have deployed Zoom or DocuSign for the first time. But much of this shift involved taking analog processes like meetings or document signing and approval and bringing them online. Things like this are merely a first step. 2021 is the year the companies will begin to connect large-scale digital events to infrastructure that can make them automated and repeatable. It’s the difference between one person signing a document and hundreds of people signing hundreds of documents, with different rules for each one. And that’s just one example. Another use case could involve linking HR software to project management software for automated, real-time resource allocation that allows a company to get more out of both platforms, as well as its people. The businesses that can automate and simplify complex workflows like these will see dramatically improved efficiency and return on their technology investments, putting them on the path to true transformation and improved profitability.

We shall see!



The How And Why Behind Recruiting AI

Let’s start with the basics. What is recruiting AI? Recruiting AI is artificial intelligence used specifically for hiring. It can read resumes and job descriptions using its knowledge to match candidates to positions where they would be successful.

Recruiting AI and other software are increasingly becoming one of the main tools for the hiring process. Technology can help to make the process much quicker and more effective. This visual guide breaks it all down.

How Can Recruiting AI Be Used Successfully?

ai recruiting

Recruiting AI makes the hiring process overall run better. It can instantly tell recruiters who the best applicants are and if it is programmed correctly with unbiased data, it can increase a company’s diversity. With an AI program trained on unbiased data, the implicit biases human recruiters have, which often unknowingly get in the way of hiring diverse people, are eliminated.

Several recruiters and HR professionals do not believe their current hiring practices are good. In fact, 81% believe their practices are average or worse. It is a daunting task to look through possibly hundreds of resumes and choose the best people. It has been found that recruiters typically spend only seven seconds looking at a person’s resume.

It is understandable why this happens given the bulk of their task, but it is not a good practice. In those seven seconds, recruiters do not have enough time to fully consider a candidate and make an unbiased decision about them.

Several implicit biases like similarity bias, the halo/horns effect, the contrast effect, and the central tendency effect can occur with the poor hiring practices currently in use. Similarity bias makes people value traits in others that are similar to their own, which directly works against efforts to increase diversity.

The halo/horns effect reinforces our first impressions of a person, making it difficult to challenge our snap judgments and bias. The contrast effect plays with the opinions people form when comparing candidates to the others considered directly before or after. Finally, the central tendency effect leaves people wary of rating anyone too extreme for fear of their opinions being formed on bias.

Fortunately, an unbiased recruiting AI can solve this. But first, you have to ensure the recruiting AI is programmed with unbiased data. In the past, AI has eventually learned the same biases as its human recruiters because it was trained with their narrow data.

To create an unbiased AI, a wide variety of job descriptions, companies, resumes, and outcomes should be used. The AI should also be blocked from seeing information like a candidate’s age, gender, or name (which could allude to the person’s race). Once you have a completely unbiased recruiting AI, the whole hiring process can be expedited and establish fairness for diverse candidates.

Higher Diversity Leads To More Creativity And Profitability

benefit of ai for recruiting

The whole idea of a quicker and fairer hiring process sounds great, right? Right! Let’s look at the many benefits of increasing a company’s diversity, which come from having an unbiased recruiting AI.

Diverse people bring diverse thoughts and processes to the table. Vildan Stidham, Divisional VP of Global Talent Acquisition at Abbott, explains, “D&I can bring innovation, creative thinking, and different perspectives that are essential in our growing businesses.” The new, creative ideas brought into companies by diverse people make those companies thrive. New inventions and ways of thinking greatly improve life as we know it.

The improvements diversity brings to innovation also brings about a company’s profitability. The 20 most diverse companies in the S&P 500 have a higher long-term profitability than the less diverse ones. Greater diversity in a company’s leadership for both ethnic and gender diversity ultimately leads to significant profitability and financial success.

Needless to say, the ability to succeed financially is what keeps companies alive and able to materialize the creative, innovative ideas their people create. And having high diversity allows a company to do both.

Using an unbiased recruiting AI throughout the hiring process can make everything easier and quicker while increasing the workforce’s diversity and the company’s success. After programming the AI to be unbiased with a lot of varied data, it can instantly recognize the top candidates for any position, including candidates that may have been discriminated against unconsciously by human recruiters.

Embracing Diversity: The How & The Why With Help From AI

The post The How And Why Behind Recruiting AI appeared first on Dumb Little Man.

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