Greenhouse Acquires Ezra AI Labs: The Voice AI Bet Reshaping the Hiring Interface

[00:00:02] HR tech, work tech, and investment are transforming the future of work. Are you in the know? Welcome to the WorkTech Podcast. Join host George LaRock for expert insights on the trends, M&A activity, and strategies shaping the workplace. Brought to you by OneWorkTech.com and the WorkDefined Podcast Network. Hey everyone, it's me, George LaRock at WorkTech. Welcome back. I'm excited today.

[00:00:29] I'm joined by, at this point, an old friend, Daniel Chait, CEO and founder of Greenhouse. Daniel, welcome. Yeah, thanks, George. Great to be here again. It's going to be an exciting day for us. Lots to talk about and great to see you again. Yeah, I, you know, there's big news. It's breaking industry news and I'm so happy you're here to help tell your story today on WorkTech, but I don't want to steal your thunder. What, you know, tell everyone what this announcement is if they haven't heard about it yet.

[00:00:56] Yeah, so the announcement is that Greenhouse announced that we are in a definitive agreement to acquire Ezra AI Labs. Ezra AI Labs is a voice AI interviewer designed to deliver structured on-demand conversations that feel really naturalistic rather than robotic. And I think this transaction is going to let us deepen our ability to help companies identify genuine talent and evolve in the AI era. It's, it's really exciting. Yeah. Um, so that's the 30 seconds on Ezra.

[00:01:25] And I think anybody that watches WorkTech knows who Greenhouse is, but just in case, give us the, you know, the elevator 30 seconds on, on Greenhouse. Greenhouse is a hiring software platform. We're used by 7,500 companies worldwide of all shapes and size to run great structured hiring processes. We've been in business since 2012 and we really see ourselves and our mission is to make hiring work for everyone. So this is an important piece of that. Yeah. Yeah.

[00:01:52] Since 2012, I think I met you just after that. And, uh, I can, you know, say that you are, uh, one of the leading, uh, platforms in the, the, I'll, I'll say the talent space, uh, at this point, because you're, you, you, uh, do a lot more than you did in, uh, 2012, 2013. When, when I first stumbled over you in, uh, Manhattan. Yeah, for sure.

[00:02:18] I mean, you know, we've obviously invested tens of millions of dollars in R and D over the years to build the capabilities of the product and really make sure that we can handle more and more of what our customers need out of hiring. And hiring has changed a ton in the past, you know, almost 15 years since we've launched. And so we've had to keep up with tons of changes in the way job seekers behave in, uh, what companies need and changes in the global hiring economy, legal regulation, you know, I could go on.

[00:02:46] And then of course, AI is, is changing everything again. And we really see this as a moment to sort of re-imagine how hiring can happen now that AI is really becoming mainstream and affecting everyone. And so we're really seeing this next era of greenhouse as one in which we can help to evolve fundamentally how hiring works and take advantage of the power of AI while also making sure to mitigate some of the risks and the fears that people have had about sort of the first wave of AI tools.

[00:03:15] So it's a time of great disruption and it's a time of great opportunity. It's really neat. Yeah. And is that, so this moment in the market, I think you just did a great job articulating sort of the backdrop, but is, is the, uh, uh, you know, greenhouse moving forward with, you know, voice AI. Is that, uh, about where you see the platform going? Is it about what the customers need today? Is it all, all of the above? I think it's, I think it's both.

[00:03:44] So, you know, at the very most basic level, what Ezra AI does is help to deliver a voice enabled AI conversation. So a conversation between a job seeker and a company that delivered by AI. And so that means that it can be done at scale. It can be done, you know, an automated way, which brings a lot of benefits. So at the basic, at the most basic level, that's the, that's the feature set today. But I think to your question, we're seeing a world where already, you know, hiring behaviors

[00:04:14] have changed dramatically. Recruiters and job seekers are both using AI to do tons of work and it's only the beginning. And so we're envisioning a world where our customers want to interact with greenhouse in a variety of ways, including through their own AI tools like chat GPT or Claude. And through conversations, they want to be able to talk to their tools. They want to be able to ask questions about candidates. They want to be able to do automations and interrogate the system conversationally.

[00:04:39] And so this is not only about being able to deliver an AI interview today, but also about helping to upgrade the greenhouse agentic AI story for many years to come. Yeah. I could dig in on that, but I want to back up a little bit and talk about the deal and then get into some of the, maybe what does this mean? So it's always really interesting to me. I've seen a lot of these acquisitions and that, and I know greenhouse is always looking

[00:05:09] at customers, roadmap partners, and there's that build by partner analysis. What was it about Ezra that put them in the buy column? What jumped out at you? Yeah. Well, basically in a nutshell is that they addressed the most important factors that matter to buyers and to job seekers alike when delivering a great AI interview. So we do tons of research, as you know, with companies around the world and with job seekers.

[00:05:38] And our research showed that job seekers were rejecting the first wave of AI interview products, really for three main reasons. The first, they found them too robotic. They were awkward. The conversations would stutter or interrupt. The voice was uncanny and not human-like. It just didn't feel good. The second is the quality of the actual interview itself was often very questionable. They weren't sure why the questions were being asked. They didn't know the principles underlying it.

[00:06:06] It just wasn't clear how decisions were going to be driven through this experience. It's a lot of fear about that. And number three, candidates were surprised that they were sort of sprung on an AI interview to them. They thought they were showing up to talk to a person. And so that lack of transparency really sets the whole thing off on the wrong foot. And so as we were looking to solve these type of problems, we made sure that the solutions that we were considering firstly addressed those issues.

[00:06:32] And I can say Ezra really designed from the ground up around those three core requirements more than anything. Yeah. So I just put out the Q1 M&A two reports, an M&A report and a VC report. And voice AI, specifically in TA, came up on the investment side. And it came up on the M&A side as categories to watch, mainly because it is foundational technology, right?

[00:06:59] So it's while right now the use case that Ezra might be interviewing, you can see to your point how this can go across the board. But I also, I hear a lot of that same pushback from all sides. And what I've been likening this to, I said it on the webcast earlier this week. I'll repeat it here. When video interviewing, I'm old enough to remember when video interviewing first came up,

[00:07:22] there was so much pushback from candidates, from employers, you know, couldn't imagine doing, you know, remote interviews. But then as bandwidth increased, as the technology got better, as companies understood how to implement it and how to introduce it into the process better. Suddenly look at us now, look at it, you know, look at where video is. And that's where I think voice is going. I think voice zooming way out.

[00:07:46] I think voice is how we're going to interact with the, our interface. That's going to be one of the primary interfaces period. So that resonates, everything you said resonates with me. And the other thing I'll, I'm here to interview you, but I should say I met the founder, Ophir of Ezra at Transform. And when I, it was just a standard, you know, analyst walking by the startup stand, getting the pitch.

[00:08:11] And the thing that stood out to me was the amount of effort they go through with their customers to get it right. It's not plug in the AI, upload your job descriptions and, you know, you're off. There's much, there's much more tweaking and rails involved and, you know, compliance factors and training the system to get it right. Understanding that you're acquiring Ezra that I've used the term thoughtful to describe greenhouse and your approach before.

[00:08:40] And I think culturally that, that fit really stands out to me. So how does that, what can your customers expect now that you've, you've got this new AI? Yeah, I think that's right. I mean, you know, getting to know Ophir and looking at what they've built.

[00:08:54] And first of all, you know, he's an incredible founder. He's a deep technologist, very familiar with, you know, the cutting edge research, the latest technology on how to deliver natural voice conversations on structured hiring and great recruiting practices on compliance, and also just a tremendously energetic and empathetic founder. So, you know, we really hit it off right away. And I'm really, really excited to have the opportunity to work with him.

[00:09:17] And to your point, the approach that Ezra has taken was very different and very in line with the greenhouse approach from the very minute that we came across this company. They think deeply about structured hiring practices. And so it's not just some generic, you know, phone tree that you have to go through as a job seeker, but actually the product starts by interviewing the hiring manager and really asking the hiring manager to describe their ideal candidate. What are they looking for? What do they really need? What are the real skills?

[00:09:47] And helping to elicit sort of the real requirements that don't always show up on a job description, but that actually matter in ways that are going to be consistent across every job seeker. And so out of that sort of very natural conversation with the hiring manager, Ezra then builds out a rubric.

[00:10:02] So an evaluation methodology, a set of questions designed to get at exactly what the hiring manager cares about and then make sure to go deliver those set of questions in that same order across every interview that it's giving to job seekers to make sure that everybody has, you know, an equivalent experience, an equivalent chance to, you know, answer the same questions. And so there is that deep design from the beginning around great hiring and great candidate experience, which Greenhouse has always been known for.

[00:10:31] Right, right. And what kind of... What if I told you that your boss skydives, Tim in marketing is a magician, and Sam in accounting does sums in his head while standing on his hands? Seeing sides of the people you work with but never see, sides that inform and inspire their work and that can inspire yours is what The Talent Show is all about. Email me, Tom Alexander, host of The Talent Show at talonshowatbackboneinc.com and show us what you got.

[00:10:59] I look forward to seeing you on The Talent Show. What's the overlap? My gut says that it's probably a lot of overlap in your ideal customer profile, your ICP and your customer base. Theirs not being nearly as big as yours, but are they targeting the sort of segment that you're currently dominating in? You know, it's early in that category. So, you know, AI interviewing as a category is still quite new and there are tons of players out there.

[00:11:28] And so I think the market hasn't yet quite evolved to where there's like you could say a dominant player. But they have impressive customers that have impressive things to say about the product. So it's been tried and tested across many interviews and a number of companies already. And I think when you think about where it's aimed, to your point, it's very much in line with what greenhouse customers are all about. These are companies that care deeply about talent. They see themselves as needing to deliver a great candidate experience because their candidates have lots of choices about where to work.

[00:11:55] And they want to make sure that the great candidates at the top talent is not turned away or displeased with how the process goes. So they want it to feel good and that the decisions are really important. And so you've got to have a good structured hiring methodology underlying it. So that way you're making solid, explainable decisions. And so it's very much aimed at a similar type of customer that, you know, Greenhouse has today and has always specialized in.

[00:12:18] I think there are nuances to how AI is being adopted around the world in different geographies and different jurisdictions. And so we're always very mindful to make sure that we roll out any technology with that in mind. And so I think there's going to be probably different adoption cycles across the world in AI and in voice AI, but very much in line with where Greenhouse is going. Yeah. And I know when you've implemented other even partnerships, I think about the Clear Partnership.

[00:12:47] You know, it's not like there's only one path. So, you know, candidates are presented options. And I know you're working on even more options there. Based on your comments earlier about the experience, I would imagine customers would have, I know it's like the ink still drying on the contract. So I'm not, you know, holding you to any commitments on product at this point.

[00:13:08] But I would imagine being thoughtful, being Greenhouse, that's a part of what you're thinking about is giving customers some control over how this gets implemented and to what degree. Yeah, for sure. So the plan day one is, you know, Ezra is going to remain on the market, you know, as it is today. While we work on the back end to, you know, more tightly integrated into the Greenhouse platform and offerings down the road.

[00:13:32] And so, you know, absolutely, we, you know, our customers need a level of governance, a level of control, reporting, these kinds of, you know, integration with the core process. And, you know, we need to make sure that we're addressing the evolving needs and desires of job seekers. I think, you know, you talked earlier about how there was a sort of adoption curve as people went and did remote interviews versus in-person interviews.

[00:13:58] You talk about old enough, I was old enough to remember when people said nobody's ever going to submit a resume online. This piece of paper is so valuable. And, you know, the feel of the cotton paper is so nice. And, of course, now everybody does it online. So I do think there's an adoption cycle. I think there's a lot of natural questions. It's very understandable why job seekers might be hesitant. But I think as the technologies have gotten better and as I think as we focus more on the needs of the job seeker, I think the acceptance is following.

[00:14:24] We're already seeing a big growth in the use of AI interviews and following that, a big growth already in the acceptance and the attitudes of job seekers that these are actually a benefit. And so we're thinking very much about, you know, not how do I use this to sort of keep job seekers out, which I think a lot of AI technology is focused on kind of this efficiency. And we've got a flood of applicants and we need to limit them and screen them and make them go through hoops. And you hear this term friction a lot. We've really pushed against that.

[00:14:53] And I think the way we're thinking about it is if a company can offer an interview on demand at any time 24-7 with infinite amount of patients at almost no cost, well, then the amount of people that are able to interview at a given company should go way up. We ought to be able to give more opportunities to job seekers to apply for more and more jobs and to showcase what they're really about.

[00:15:14] Go beyond the resume, which I don't think does a great job of representing who you are and what you're great at and really have an open conversation from the get-go with that company because AI just makes it so much more scalable and so much easier to do that, you know, over and over again. So I'm really hopeful that it provides, that we can provide a level of opportunity and remove some of the gatekeeping from interviewing that's been in place for generations. Yeah, I think it's all about meeting candidates where they are. And that's not just on their career journey.

[00:15:44] It's literally like, you know, this could be someone who's like a gray-collar worker who needs to do voice in the middle of the night because they worked a late shift. It could be an engineer who needs to go to their car at lunch because they can't do the interview from their desk and they don't want to sit in the car and do video. And this is a much faster way to get to results. And we see voice picking up on all of the AI tools. I mean, I talk to Claude a lot.

[00:16:14] And I don't have a conversation with Claude as much as I'm just to be clear for you. So we talk a lot about the market and we talk a lot about the product. The other constituency I just want to touch on is the employee base. And what an exciting time on both sides.

[00:16:32] I feel like the opportunity for Ezra is clear to, you know, see their technology in leading a market-leading platform and become foundational and power the whole talent lifecycle. And I know Greenhouse has been working on a lot of AI and a lot of innovation. But now to have this tool in the tool bag to put across the product, this must be an exciting announcement. But you haven't done an acquisition in a couple of years.

[00:17:01] So this is like, you know, this must be a boost of real, you know, sort of innovation energy into the team. It is. I mean, this is a really exciting year. You know, I've talked about this in other venues and I've posted this online before. But, you know, this is a year of real disruptive challenge to not only our field, but to all of really software. And in those disruptive moments, there are challenges and threats for sure that you need to be aware of.

[00:17:30] But there are also amazing opportunities. And I think if you look at past disruptions, whether it's the Internet, mobile, you know, social, you go on, there's winners and losers. And the winners are the ones not that stick to the old model, but that adapt most readily and most successfully to the new models. And so we're really thinking about what that looks like. We want to emerge from this, you know, as Netflix, not as Blockbuster.

[00:17:52] And that means embracing the power and the possibility that AI can bring while being very aware of the risks and the concerns, the very real risks and concerns that AI presents. I think if we can navigate that balance really well, I think that'll help us be best positioned, as you say, to deliver amazing amounts of new value to all of our stakeholders, to job seekers, to customers and to the company.

[00:18:16] So it's a really neat time where you can sort of fundamentally rethink a lot of the assumptions that we all carry about how hiring can work. Why are there job applications? Why are there people doing interviews the way that they are? Why are there resumes? We rethink a lot of how software can work. Why do you have to click a bunch of buttons and menus to get what you want instead of talking to the computer? We rethink how software is delivered and priced and sold and bought and what it's capable of. And so, you know, it's a really imaginative and expansive era.

[00:18:45] And I think we've approached it from that lens. And so, yeah, there's a lot of enthusiasm and excitement. But, you know, I'm not unaware of the hard work that it takes as well. So there's a lot of sleepless nights and a lot of long days as well. Yeah, it's a big job getting a deal done. And then it's ironic that it feels like that's really when the work starts, when you get it done. Well, I want to congratulate you on getting a deal done and an exciting deal. This is one that what it represents to the market, I think, is a big deal.

[00:19:15] And I want to thank you for being here at WorkTech. I could go on and on and ask you a million more questions about a million other things. But maybe we'll do this again sooner this time, next time. Thank you. Thank you, Daniel. Thanks a bunch, George. It's always great to talk to you. And I'm looking forward to the next conversation. All right. And we'll link to the press release and we'll link to the website so everybody can follow the deal and learn more if they're interested. Thanks wherever you're watching or listening. And until next time.