Case Study -- CollegeRecruiter.com

By Richard Milgram, CEO 4Jobs.com

Commercial Internet sites face a continual struggle between spending money to maintain and enhance their technology to deliver the best possible service to users, and postponing such spending to deliver the best possible rate of return to investors. Over the long run, sites that fail to maintain or improve their technology are left with antiquated systems, dissatisfied users, and a date with their bankruptcy lawyers.

CollegeRecruiter.com, a privately held Internet site, has repeatedly faced this challenge. However, the site has always been profitable; ranking as the highest trafficked site visited by job hunting college students, recent graduates, and employers.

Historically, career sites such as CollegeRecruiter.com have followed the traditional newspaper classified section business model: give away content to job seekers, and generate revenues through the sale of help-wanted advertisements to employers. The problem with this model is that it fails to monetize the overwhelming number of visitors to the career site: job seekers. The challenge associated with trying to monetize job seeker traffic is that most job seekers don't have disposable income at hand.

CollegeRecruiter.com, founded by Steven Rothberg, started out by publishing campus maps and employment magazines. By the fall of 2000, Rothberg's business was completely Internet-based and focused on helping students and graduates find employment. He has not accepted outside investment, instead financing technology and other investments through positive cash flow.

Although the first two versions of CollegeRecruiter.com used proprietary technology developed and maintained by the website's staff, the prospect of spending hundreds of thousands of dollars every year, just to keep up with his competitors, made Rothberg balk.

In late 1999, he made a radical change to his business model. Rather than employing staff to develop and maintain a proprietary system, he paid an Application Service Provider (ASP) to deliver even better technology, in return for charging a monthly licensing fee that was a small fraction of what Rothberg would have paid employees.

The ASP model worked extremely well technologically speaking. However, Rothberg soon realized that theASP functioned solely as an outsourced information technology department -- it was a cost center.

During the winter of 2003, Rothberg began to actively seek an alterative. He sought a partner rather than provider-an organization that would deliver the technology, and also function as a profit center, rather than as an expense. Through his network of contacts in the career site industry, Rothberg connected with the 4Jobs.com Career Network.

Founded in 1996, the 4Jobs.com Career Network and its parent company, Artemis HR, focus on offering websites a complete career center solution, including software, technology, customer service and sales. Websites such as CollegeRecruiter.com can then focus on their core businesses and drive traffic to their career center pages. In doing so, they generate predicable and incremental revenues from 4Jobs.com Career Network. Rather than just trying to sell books or resume writing services to job seekers-many of whom are struggling to pay the rent-4Jobs.com generates revenues indirectly, from actions taken by those job seekers.

For example, for job seekers interested in obtaining another degree, or continuing their education, 4Jobs.com Career Network built an education section where candidates are asked a few simple questions such as their desired type of school, and program. 4Jobs.com Career Network then matches these candidates with schools that pay for these leads. 4Jobs.com Career Network subsequently shares these revenues with its career site partners, which in this case includes CollegeRecruiter.com.

When CollegeRecruiter.com went live with the new 4Jobs.com Career Network in March 2003, they observed a significant increase in profits immediately. Rothberg projects that the website's profits in 2004 will double the profits generated in 2003, due to the partnership with 4Jobs.com Career Network. CollegeRecruiter.com now has the time and financial resources to focus on delivering outstanding employment-related content to its job seekers, outstanding customer service to its employers, and increasingly profitable financial statements to its accountants.