Ben Hutt recently shared the highs and lows of his entrepreneurial journey to becoming Search Party’s CEO at Innovation Bay’s Breakfast Q&A, watch it here.
Despite having raised over $20 million in funding, and expanding into four countries (soon to be five) across three continents—what strikes you immediately about Search Party CEO Ben Hutt, is how understated he is about his remarkable success. He joined us for a breakfast Q&A in Sydney this week, giving our members an open book into his entrepreneurial journey.
Ben’s entrepreneurial journey began a little by chance. Having chosen not to join several ultimately successful ventures he helped found during and after university, Ben was working in London as a management consultant when his mum died suddenly. He was just 25 and took a sabbatical to allow time to renovate her house and tidy up her affairs. During the project his builder, while excellent, was in business trouble and Ben took the opportunity to trade his business management skills for building work. This became his first foray into start-ups.
“I made a bunch of stupid mistakes, but I really learnt from them. I also learned that in business you will get stuff wrong all the time, it’s just how quickly you recognise it and change course that matters.”
When the house was finished, Ben decided to travel, and having spent some time in Australia with a friend, he decided to move to Australia late 2004. He chose to take his MBA at the Australian Graduate School of Management, and immersed himself in a range of business and charity projects with friends.
With his visa about to expire towards the end of his degree, he took up a job with a niche consulting firm and later in 2007 joined Macquarie Group. It wasn’t great timing due to the GFC but during his five years there he worked on some amazing projects with great people.
During this time, the shift in technology was evident to Ben: “You could see the internet changing everything; it was all going to be different.“ He was approached to help with a technology idea for the already evolving recruitment industry, and in October 2011 began spending his evenings and weekends working on what eventually became Search Party. In March 2012 Ben and his partner at the time, Jamie Carlisle, raised the first $1m.
“It’s an industry that’s worth more than $350 billion globally. Recruitment is a massive, massive thing, and yet less than 3% of the revenue is done online. I thought: we can help this industry evolve to deal with this change.”
Ben launched himself in at the deep end, and mid-2012 spent two weeks travelling around Australia talking to recruiters, discovering what they needed, and what their challenges were. What became clear to him is that selling the benefits of moving business online was going to be a core challenge in the early stages: “There was no fear; it was pretty clear to me that the industry didn’t see any threat from online. It viewed the move to online as just another cycle.“
As a former psychology student that’s been in and around the business world for some years now, Ben recognised the lack of motivation for change: “You either need sufficient fear to make the change or you need enthusiasm.” Neither was there.
He and his business partner then did some problem-solving, revealing just how much he had embraced his new country: “Like all efficient start-ups, when things don’t go well, you go to the pub! On our ninth beer, we recognised something from our psychology training. This was denial – likely the last phase of an economic cycle!” According to Ben, denial comes before significant change, and with this renewed enthusiasm they set about making the platform more focussed on solving recruitment’s key problems – create a marketplace that embraced the recruiter, the candidate, and the employer in the recruitment process.
“On average it was taking companies 12 weeks to make a hire. It was time-consuming and expensive, and the candidate was often not the right fit for the job. We wanted to create a platform when it would take only two weeks to hire. A platform that located the best candidates and the agencies that represented them, presenting them quickly to the employer and getting interviews started straight away.”
The technical needs of such a platform were immense, but they set about the task regardless. This complexity has given Search Party’s potential competitors a significant barrier to entry for anyone wishing to replicate their business model: “We know people have backed off from copying what we do, simply because it is so complex, time consuming and expensive to solve.”
To be able to bring together collectively and efficiently such a significant amount of data, and join three market participants together in this marketplace business is in itself an incredible achievement. It’s one that Ben feels strongly would not have taken place without the right team, significant investment and support from key advisors along the way.
“Above all else, there are two key qualities we value in people: courage and intellectual curiosity. We need our team to be brave, and we also need to be able to continue to find better ways of doing things.”
Ben has been brave, releasing the platform perhaps a little earlier than he now thinks was ideal: “Launching the product too early is a big mistake; launching it too late is a big mistake, too. If I had my time again, I would have spent more time in a dark room with the engineers before releasing it. When we did, we had set very high expectations with our investors, who were wanting nothing less than spectacular results.”
Ben seems to be especially accepting that being an entrepreneur and managing the growth of a successful start-up is not an easy journey. “When you have big plans, they will be expensive and they will be painful. The problem with a start-up is that you never feel like you’re winning, but you have to accept that life is full of challenges. Challenges are something we all have; they’re part of the journey.”
Despite embracing the ups and downs of the journey, Ben’s company is by any measure an incredible success. His advice to those about to begin the journey—particularly the key challenge of funding and growth—is particularly astute: “The worst time to ask for money is when you need money. It makes you weak, and you can take it from the wrong investors. I think a better strategy is to work with potential investors and ask them for their advice first. If they take the time to provide advice and they like what you’re doing, they’ll be more likely to invest and support you on the journey.”
Despite having raised more than $20 million (one of the few Australian start-ups to do so), Ben still seems far from finishing his journey of discovery: “Marketplace businesses typically take 6+ years to achieve ‘overnight success’ status”, and we look forward to watching his continued ascent as he continues his search for accomplishment.
Missed the breakfast with Ben Hutt? You can watch the video recording here.
First published in Innovation Bay on 29th June 2016.