The way I see it, recruitment is a cyclical business and Xref's...

The way I see it, recruitment is a cyclical business and Xref's current credit-based business model is cyclical. I completely agree that they should go subscription-based for their large customers or give the flexibility to do that. However, going from credit to subscription means that their subscription product has to provide more than just a change in the business model. Currently, that is not the case.

If I am a large customer who is using Xref, conducting between 100 - 3000 reference checks a month, and I am forced to go subscription. There will be some months where I do 100 reference checks and pay the same monthly fee as if I did 3000 checks. There needs to be more incentive for me to switch like maybe better-curated analytics or automation screening that comes with the subscription. An additional set of tools that the company would not cut as it is mission-critical for operating the business efficiently. That's the issue with Xref, they haven't build a sticky product where customers pay Xref a fee regardless of what happens in the real economy. Revenues are cyclical as they are correlated with job ads. Their product integration with Linkedin was good as it shows that the platform is flexible, however, It is still not sticky. A customer still pays for credits when they want to and in some months they might not hire anyone, so no fees to Xref. Even with Linkedin integrations, as a customer, I get access to more candidates but I would not want to pay a fee if I couldn't hire anyone.

Here is what I think the company could do, to get customers to subscription. Creating an aggregator analytics dashboard for a candidate prior to screening. Let's say my name is W and I worked at X,Y and provided reference checks when I am applying for Job 1. After 1 year of work, W decides to quit that job and then did an application for Job 2 for Company Z. Assuming both the company that gave job 1 and Company Z uses Xref, Company Z is given a dashboard for W and the reference checks for X,Y. Hence what Company Z could do is redo the reference check for X and Y as well as the reason for W leaving Job 1. They can cross-validate to see if the candidate is telling the truth. Network effects are important as both companies have Xref installed to validate where the candidate was working. So, the analytics dashboard during pre-screening is quite useful for customers as it saves time and makes HR more efficient. I could see customers paying for the subscription if analytical tools like that are included in the package. That was just my example on a value-added service they can get in a subscription. In order for the business model to work, they need to build something that a company use regardless of whether companies are hiring or stalling their recruitment drive. Unfortunately, Network effects alone are not enough in the recruitment industry.