I used to work for Dice, the primary revenue driver for DHI. It was a long long time ago, and the job board world was very different. So take the following with a grain of salt (as in fact you should always do from any self-proclaimed pundit of our industry!).
DHI recently did something that had me scratching my (ever receding) forehead. They invested in TheMuse. That’s right, TheMuse, as in the employer branding job board aimed at the stylish job seeker (i.e., millenials). If you’re like me (and apparently the news hit Chad and Cheese the same way), you immediately said…huh? I mean, until very recently, DHI’s financial performance had been anemic, Dice’s sales had been declining to flat, and only ClearanceJobs seemed to offer a glimmer of growth for the company. So – trying to survive, pushing past the pandemic, and then….”Hey, let’s invest in something. Not something tech, that would be too predictable. Let’s invest in a glossy employer branding site!!!!”
You can just imagine the discussion in the DHI board room. It must have been late at night. A Friday. Maybe the quarterly financials had just come through showing some modest growth. They’re thinking, ‘yeah, let’s update our guidance, show some growth for the 3rd quarter – and then let’s blow everyone’s mind by doing something totally crazy!!!’.
Well, it could’ve happened that way…
Let’s turn to DHI and see what their public explanation in the press release was: “The investment will be used to support the expansion of The Muse’s product development and sales efforts to meet the increasing market demand for its unique values based employer discovery offerings. Terms of the planned transaction are not being disclosed at this time. In addition to the investment, the two companies will work together to develop joint sales, thought leadership and product solutions to better serve their respective stakeholders…”We believe The Muse is a true leader in providing solutions that authentically support this discovery process with great benefits for both employers and candidates. The Muse is an ideal partner for Dice as we look to accelerate our own ability to deliver these same insights to technologists customized for their specific interests,” said Art Zeile, CEO of DHI Group, Inc.”.
Ok. Right. Those are lots of words, all right. Can you figure them out? I can’t. Here’s what I know. TheMuse has taken in fairly large amounts of VC funding – enough than I am surprised $3M is worth talking about. DHI has been struggling for a while, and Zeile is still basically the ‘new guy’ trying to make his mark.
But really. Even if you believe the public pronouncements (expert tip: don’t believe the public pronouncements!), the stated reasons don’t make much sense. Why wouldn’t DHI use the money to acquire a smart, up and coming recruiting technology provider? Or even a tech-oriented site that isn’t a job board? Or even (gasp!) reinvest it into the company itself, to grow over the long term? Well, I don’t know, because I don’t work there. (But some of you do – and if you want to whisper answers in my ear, I’ll never tell! Promise!!).
Joel thinks it’s a DHI mid-life crisis. Chad thinks it’s a lack of focus. I think…my Friday night scenario is looking better. Dumb things happen late at night, as we all know. Chad and Cheese want to kick out Art and become co-CEOs. I would say…I’ve been there, and I can guarantee you don’t want to do that.
You got any ideas? Let me know. I’m going back to scratching my forehead!!![Want to get JobBoardDoctor posts via email? Subscribe here.].
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