Last year, the HIRING world had a big change. Many were impacted but most didn’t notice. At the centre of it is a young startup called Pallet. It is the most innovative recruitment model I have seen in a decade & they have a great origin story. Let’s start there…

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TIKTOK NOT SEARCH

Pallet’s starting insight was that job platforms had a discovery problem. They worked like Google search. They assumed people knew what they wanted, would enter the right search terms & then click on relevant links. But Pallet felt Tiktok was a better model.

Pallet reasoned that people’s job searches were very narrow & familiarity based. People would actually be open to many more kinds of roles if someone curated a diverse but relevant list & then refined it based on their responses. You know, like Tiktok does with dance videos.

So this is how they started: Curated Jobs playlists (they were called Cardea then). Plan was: - Build a better tool for candidates - Get famous people to guest-curate playlists - Go viral & get lots of users to follow these playlists - Then get companies to pay to list jobs

To make this work they had to create a 2 sided marketplace so they reached out to the marketplace expert: Lenny Rachitsky. But the chat with Lenny took an unexpected turn & led them to a 2nd insight. One which completely changed their model...

SOMETIMES BEING KINGMAKER IS BETTER THAN BEING KING

Lenny had no interest in ‘Guest-curating’ a jobs playlist. He already had a 2 sided marketplace (companies & candidates in his PM community). He just wanted a tool to do this easily while keeping the job board on his domain.

Others noticed this & within a few months people like Sahil Bloom, Packy McCormick, Dickie Bush, Casey Newton & Nik Sharma had launched theirs. Even much smaller communities are finding success & Pallet is becoming a common Noun: “Congrats on your Pallet, I’ll launch mine next week”

IT’S A WIN-WIN-WIN-WIN

There are 4 parties involved in this model: 1️⃣ Candidates 2️⃣ Companies 3️⃣ Creators 4️⃣ Pallet The model seems to be working for all of them. Let’s explore each one by one.

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Candidates: - Jobs come to them (online communities), instead of them going to the jobs (LinkedIn, Indeed) - Jobs are curated by a trusted entity - They wouldn’t know of or find these jobs on their own - It’s a finite selection + they avoid recruiters pitching irrelevant jobs

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Companies: - Their jobs are shown to a filtered & interested pool - They don’t have to vet 1000s of irrelevant applications - In a crowded market, they benefit from the creator’s brand - They can get a sense of the candidates based on their contributions in the community

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Creators & Communities: - Pallet makes it easier to setup the Community-Job marketplace that is organically emerging - It brings additional revenue without needing new content or asking the members to pay - It adds value to their community, increases good-will, deepens moat

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Pallet: - No need to acquire candidates or engage them on the platform (creators do that) - No need to curate companies (creators do that) - Communities are self contained, so scaling Pallet doesn’t increase platform noise - Pallet benefits when creators promote their boards

WHAT ARE THE #s ?

SO WHAT HAPPENS NOW ?

It’s clear Pallet is going to grow a lot on the back of the creator economy. And given it is such a good idea, there will be tons of competition. The question is how will Pallet react to that ?

I see two possible paths:

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First, Pallet could purse their original Platform dream. They are trying ideas like People Boards (instead of listing jobs for the community, list the people in the community). Linking People & Job Boards OR cross promoting across communities could lead to a platform.

The risk I see here is that, the creators might dislike Pallet’s platform ambitions & switch. Remember the market-maker here is the creator & not Pallet. So creators hold the power in the community, not Pallet. ——— But there is another way for Pallet: less glamorous, more feasible.

Pallet could become the default job tool for the creator economy. Tools don’t have the invincibility of network effects but there are more successful tool companies than there are platforms. Substack, Gumroad, Teachable are all doing well & even Shopify & Stripe began as tools.

Tools win on features, price & by becoming the industry default. Job boards are not the creators’ core activity, so most would prefer to just use the industry default. Pallet can become that & win without building a platform. ——— It will be interesting to see the path they take.

Now a days there is an online community for every niche. They have interesting people, trusted creators & are free of the vitriol poisoning big social platforms. No wonder people prefer them. Pallet is well positioned to ride a trend which will only get stronger.