January 11, 2013
The unemployment rate has been falling – slowly, but steadily – yet, there are many unemployed and underemployed Americans who are still feeling the pinch of a tight job market. This uncertain environment has been an ideal one for startup Kauzu to grow its own business.
Chicago-based Kauzu has set out to disrupt the $170 billion U.S. employment industry with a platform offering tools to create the connections that can turn job seekers into new hires.
Kauzu describes itself as eHarmony-meets-eBay for the employment industry, and since job searching can seem like a mix of business- and passion-seeking, this description seems appropriate.
Kauzu Founder and CEO Mitch Schneider shares his insight on starting up in Chicago – and starting up in general – in a Q&A session below.
Tech Cocktail: Who does Kauzu target?
Schneider: “We target Chicago jobseekers and employers. Our free mobile apps for jobseekers initially target the approximately 1.2 million Chicago‐area residents between the ages of 15‐29 who frequently seek entry‐level jobs. Our business tools target the 42,000 Chicago retailers, shops, and other businesses that employ entry‐level workers. Future markets will include other cities and larger businesses.”
Tech Cocktail: What was the inspiration behind Kauzu?
Schneider: “Much of my career has been with nonprofits, and I’ve seen how so many social problems can be traced to a lack of financial self-sufficiency and a local community that can support its residents. But the tools available to help people who face these issues find jobs—and to help businesses find staff—are just awful. Staffing is a huge market, it’s only going to get bigger, and the opportunity for better tools is enormous.”
Tech Cocktail: What do you enjoy most about working on Kauzu?
Schneider: “What I enjoy most is the enthusiasm for our tools from all sides—nonprofit workforce development centers love what our apps can do for their clients, and chambers of commerce love what we can do for their businesses. It’s rewarding from a social impact point of view and from a pure business point of view.”
Tech Cocktail: Who is Kauzu’s greatest competitor, and how do you differentiate yourself?
Schneider: “We’re really drawing a bead on Craigslist. So many independent businesses list their job openings there because it’s cheap, but all they get is a bare-bones text listing. For about the same cost, we give them exponentially more—access to our free, hyperlocal job search tools, time-saving functionality, application filtering, and analytics on every jobseeker who even views a listing. Employers can hire local, hire better, and grow their businesses.”
Tech Cocktail: What is the biggest advantage and disadvantage of starting up in Chicago?
Schneider: “The biggest advantage is the connection within communities between nonprofits, businesses and politicians. We’ve partnered with these agencies to leverage their reach, credibility and brand recognition into expanding our user base. People who need help go to their community center or their Alderman, business owners rely on their chamber—and our partners help get our tools into the hands of people who need them.
The biggest disadvantage? The ‘social venture’ story is still a very tough sell with investors here. We’re proud of our social impact, but we’re fortunate to have a high-growth revenue model as well.”
Tech Cocktail: Describe a challenging moment or a crucial decision. How did you deal with it, and what did you learn from it?
Schneider: “We were running full steam to launch our first mobile app in early May. We’d pre-registered well over a thousand jobseekers. But at the end of April, we got hit with challenges on the tech side and the financial side, and we had to put everything on hold. Then the question was, what now?
Knowing the tech would take much longer to build than we’d originally planned, we spent the next three months preparing a lot of the groundwork we may have rushed through earlier—firming up partnerships, sharpening our message, and focusing not just on what our tools could do, but on why it mattered, and who it mattered to.”
Kauzu was a featured startup at our Tech Cocktail Chicago Mixer and Startup Showcase.
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