The LinkUp Blog The Industry's Best-Kept Secret
Monster Acquires ATS Company Trovix
Monster announced yesterday that it had acquired Trovix for $72.5 million. Trovix has developed a web-based applicant tracking and candidate matching system. The company had raised at least $18 million in 2 rounds of financing. In December of 2005, the company raised $5.25 million from U.S. Venture Partners and 3i, along with some angels. Then, less than a year later in September of 2006, the company raised $13 million from Granite Ventures and existing investors. The Mountain View-based company has 40 employees, all of whom will be joining Monster.
While I certainly don’t have detailed information to make an informed opinion, my first guess is that $72 million is a pretty rich price for an early stage company like Trovix, who still has ‘beta’ plastered all over their site. Applicant tracking makes perfect sense for Monster, but the claims by Trovix that they have developed some massively powerful secret algorithm to match candidates with job openings is, to say the least, overblown. They have an ATS system that allows employers to search through resumes and manage the workflow around the hiring process. That’s it. Applicant tracking systems are terrific applications for employers who use them, making the hiring process more efficient, effective, and collaborative. Trovix probably has a nice application and it is definitiely worth something, but $72 million?
So while the acquisition definitely makes more sense than the ridiculous purchase of Affinity Labs ealier this year, I’d say this deal stands as another example of Monster overpaying for something they hope will improve their deteriorating business model.