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Tokyo-based Refcome, the Japanese startup behind a referral recruitment platform under the same name, announced earlier this month that it has raised 205 million yen (about $1.8M US) in the latest round. This round was led by Itochu Technology Ventures (ITV) with participation from Beenext, Anri, and Draper Nexus. This follows funding from Movida Japan when the company was established, and the 50 million yen fundraised in the seed round back in October of 2016. Beenext, Anri, and Draper Nexus are follow-ons from the last round while this is the first investment in Refcome for ITV.
Refcome had been operating under the company name of Combinator since its foundation. Coinciding with the funding this time, the company has been rebranded into Refcome to match with the name of the service.
The company was founded in March of 2014 with launching a web service called Combinator, aiming to help startups find their potential employees leveraging social graph integration. In January of 2016 the company had a change of direction and started the trial operation of the Recome referral recruitment platform, followed by its official roll-out back in July of the same year.
The platform is focused on helping companies strengthen their referral recruiting effort. It is characterized by its focus on performance measurement in addition to providing general ATS (Applicant Tracking System) functions such as a hiring page. In February of this year, the company unveiled the Refcome Engage platform, aiming to help companies lower their employee turnover rate by analyzing employee satisfaction.
The company has not disclosed how many companies are using the service, but according to Refcome’s CEO Takumi Shimizu told The Bridge that the total number of registered employees of companies using the service has expanded from 2,700 at the start of service to 30,000, making the current number more than 10 times what it was originally. The company claims that the monthly user growth rate (MoM growth) is about 20% while the monthly recurring revenue (MRR) has reached 15 times as much as when the service started.
In addition, compared to immediately after the launch one year ago, Shimizu discussed how the use of Refcome is changing.
- Changes in the user industries: Previously, there were many cases of use by IT ventures. But now, it is used in the recruitment for dispatch companies, where staff members call other staff, exemplary cases such as veterinarians recruiting other veterinarians to work in veterinary hospitals increased. It is also being used by real estate and apparel business operators.
- Change in the recruitment phase: Before, 15% recruitment for new graduates, 10% part-time recruitment. But now, 10% recruitment for new graduates, 40% for part-time employment and temporary recruitment and 50% for mid-career recruitment.
As a more interesting trend, Refcome is used by staffing agencies for recruiting part-time workers for companies like Hanamaru Udon (noodle restaurant chain), Don Quixote (discount chain store), and Daimaru (department store), but the high tendency to call upon friends by Chinese and Indian users of Refcome is remarkable. According to Shimizu, in China and India calling friends to your workplace is a daily act, and the company is analyzing whether such cultural backgrounds may have an influence.
So far, Refcome has win the top at the 9th Incubate Camp in 2016, the runner-up at the B Dash Camp 2016 Fall in Sapporo pitch finals, and also won the IBM Blue Hub Award at TechCrunch Tokyo 2016.
Using the funds, the company will enlarge the team from 10 to 13 persons. Because there is use from various industries, the company will increase the staff supporting customer success according to the user’s business needs, and strengthen marketing activities. Also, in the medium to long term time span, the company plans to advance the development of new services with special attention to expanding functions that include not only cultivating a human resource pool for acquiring new employees but also talent management for retaining existing employees.
Translated by Amanda Imasaka
Edited by Masaru Ikeda