Diversifying a $3 million business

Hey there,

So, in the beginning of this year, we decided to build a new offering at Flexiple. This was to help companies hire full-time engineering talent, in addition to contract engineering talent.

This wasn’t a decision made in haste, but something that we felt was the right move due to multiple reasons.

I believe sharing the thought process can be quite helpful for you if or when you consider expanding your offering. So, let me break that process down in detail today.

The start & the concerns

So, it was late last year when we first had the discussion to expand our offering. There were immediate concerns that it could be a distraction from our existing vetted contractor talent network which we had grown to a decent scale. Shouldn’t we just double down and focus on growing it to 10x in the next couple of years?

The fear was & is valid. Any new initiative eats away time, energy, and money from existing initiatives. But, here are the reasons why we were convinced that it made sense for Flexiple to extend into the full-time engineer hiring vertical.

1. Supply not being utilized efficiently

Firstly, we get a lot of talent applications each week to join Flexiple’s network. About 50% of that was from engineers who already had full-time jobs. Since our first offering was only for full-time freelancers (those who had taken up freelancing as a career), we had to straight-up reject engineers with a job.

This meant we were wasting 50% of our supply. This new offering helps us utilize that talent and of course, means that we don’t have to build that talent base from scratch.

2. Demand from existing clients

Also, almost all of our clients hire full-time engineers. So, we had an existing client base whom we could serve with this new offering. It also meant that we could serve our clients whenever they wanted to hire engineers - on full-time or contract. Moreover, we could re-target accounts that had “outgrown” us and started hiring FTEs.

So, we had a head start on supply and demand.

3. Good understanding of the hiring market

We had spent a good 5 years in the tech hiring market already. Yes, it was in the contractor hiring market and there are nuances to the full-time hiring market. However, we understood the ecosystem well and were confident that all the knowledge we had gained would help us set up this new vertical quite easily. Now, I can say that this hunch was right.

4. Diversifying Flexiple’s business

Even the funding climate had started worsening last year and we started seeing a dip in the contractor hiring marketing vs. earlier. This move would help us diversify Flexiple’s business beyond the contractor hiring market.

5. Leverage our brand recall better

Our contractor vertical largely caters to US companies and not as much to the Indian market. Indian companies have had lesser appetite to hire contractors who work remotely and even engineers seem to prefer to work with US companies at much higher salaries.

With our full-time hiring vertical, we are now able to cater to the Indian market much better. It is an offering that companies are super comfortable with and even the pricing works well for them. As we have a solid network in India, this puts us in good stead to do well in this market.

6. Market is huge and the problem is still unsolved

Finally, the tech hiring market is huge and the problem is still largely unsolved. Of course, the market is also quite crowded which is painful, but we were confident that an end-to-end offering of helping companies source, evaluate, and hire candidates would see traction. So, it gave us confidence that there is a good & solid business to be built here.

Best,
Karthik

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