Startup Review: Noirefy
Noirefy is a referral platform built to connect underrepresented minorities to opportunities globally. The Company was established as a response to a lack of inclusion and diversity in the corporate workforce to effectively connect top tier companies to qualified minority applicants through a digital referral system and virtual social network. The growing, women-led, minority referral system seeks to bridge the gap between minorities that are qualified for positions and the amount that are actually interviewed and hired.
Launched in 2016, the startup aims to increase diversity through referrals and eliminate discrimination in the hiring process. Job seekers can search and apply for jobs directly on the Noirefy platform, and companies pay to post jobs and get their opportunities in front of a diverse workforce.
A company who is signed up with Noirefy can improve upon its diversity and retention of talent. The platform provides data and insights into a company’s corporate culture, recruiting trends, and employee retention rates. Many of these areas are difficult to quantify, especially in regard to diversity. Once a company is signed up with this platform has a wide array of analytics at its fingertips to learn more about the minority job market and what trends are occurring within its own industry.
Noirefy also has a referral model that is designed to take the pressure off of companies who are having trouble finding diverse candidates. The members of the platform can refer other members within their network. Referrals are especially helpful as they are the top source of job hires, delivering one-third of all corporate hires. Employees that are referred also have higher retention rate than any other form of recruitment. Other users are incentivized to refer candidates so they can cash in on referral bonuses that most companies have internally.
Through September 2017, the Company already had 2,000 candidates signed up on its platform. The Company plans to utilize the fremium model. The Company would charge $9.99 for a premium membership, which will highlight users’ profiles on the platform. The Company is also experimenting with conferences, such as the NYACF (short for Not Your Average Conference or Fair) which will bring diverse voices from various backgrounds into a collective space to share thought provoking opinions, inspire and empower attendees over two days. NYACF is taking place in Chicago on February 7th and is being advertised as the “first annual” event.
In the United States, the Equal Employment Opportunity Commission (EEOC) makes it illegal for employers to discriminate against employees or prospective employees in the workplace. Though it is illegal to openly discriminate, it isn’t necessarily illegal to have a work environment that lacks diversity. If there is only one representative from any type of minority, that one employee can suffer from isolation at work; therefore, there is a need for diversity in the workplace.
The latest research from McKinsey finds that companies in the top quartile for gender or racial and ethnic diversity are more likely to have financial returns above their national industry medians. Companies in the bottom quartile in these dimensions are statistically less likely to achieve above-average returns. And diversity is probably a competitive differentiator that shifts market share toward more diverse companies over time. In the United States, there is a linear relationship between racial and ethnic diversity and better financial performance: for every 10 percent increase in racial and ethnic diversity on the senior-executive team, earnings before interest and taxes (EBIT) rise 0.8 percent.
Research shows that people with white-sounding names are 50 percent more likely to get a callback for an interview than people with black-sounding names. And a name is just one possible area of bias— gender, education, and a nebulous “culture fit” can all negatively impact women and people of color in the recruiting process. While there’s been increased pressure on major companies, particularly in tech, to recruit a more diverse workforce, there hasn’t been much progress. Some companies – especially in the tech industry – claim that their recruiting problem lies on the supply side or pipeline, with not enough Black and Hispanic students graduating with degrees in the necessary fields. However, an analysis by USA Today revealed that these two groups are graduating with degrees in computer science and computer engineering at twice the rate that they’re being hired by the top tech companies.
Google’s workforce is, by its own accounting, 69% male and just 2% African American. Just 20% of technical jobs are held by women. Google may be unequivocal in its “belief” about diversity, but the figures make its shortcomings clear. The company tends to hire white and Asian men over women and other racial minorities. In Silicon Valley African Americans hold just 2.7% of the jobs in tech categories. At premiere employers like Google and Facebook, black representation in technical jobs drops below 2%.
Although it is clear that diversity is important in the workplace for ethical and economic reasons, it is difficult to achieve. Several silicon valley giants, such as Google and Twitter has made large investments into diversity programs and have still not achieved the results they desire. One effective route to remedying this issue could be to rely on referrals in the manner that Noirefy lends itself to. In general recruiting, while referrals account for six percent of applicants, they make up over a quarter of hires, recent research found. That’s because referral applicants are likely to stick around longer. That said, employees tend to refer people of the same gender, ethnicity, and education which can lead to a homogenous staff. Noirefy aims to fill the referral pipeline with a more diverse candidate pool.
At this time, Noirefy is taking on the entire on the entire professional networking industry. The acquisition of LinkedIn by Microsoft is probably the high-side comparable transaction to give a snapshot of the potential for this Company. Microsoft made that acquisition for $26.5 billion at the end of 2016. It is more likely, however, that Noirefy plays in this space concurrently with LinkedIn.
The Bureau of Labor Statistics show that 20-24% of Americans change jobs every year (ADP global research says it's 27%), which means more than 41 million people are searching for jobs and being recruited into jobs every single year (in the US alone). Several billions of dollars are spent on job advertising (Indeed, Glassdoor, LinkedIn, CareerBuilder, and others compete for this market) and even after people apply, companies on average spend approximately $4,000 per candidate on interviewing, scheduling, and assessment to decide if someone is right for a job. It is estimated that the entire recruitment market is over $200 billion worldwide, and nearly every employer is a participant.
With Noirefy’s unique focus on referrals and underserved minorities, it is safe to say that the Company can take a chunk of that $200 billion figure and augment it to provide better opportunities. Without any known revenue figures and pricing mechanisms, it is still a conservative attitude to think that this Company could someday be a billion dollar entity.
At this point, Noirefy has raised an undisclosed round of fundraising. This round took place during the middle of 2017. Noirefy was also part of WiSTEM, an incubator of sorts from 1871 out of Chicago. WiStem has a focus on women in entrepreneurial efforts. It is nearly certain that Noirefy will find more backers as it builds its base and spreads the good word.
Shaniqua Davis is the founder and sole member of the management team of Noirefy. Shaniqua graduated from Michigan State with a degree in Media and Information Technology. She has worked in marketing and digital marketing before founding the company. She has a background for success and has a very bright future in front of her.