Kormo, the marketplace for informal sector and urban jobs, was formally launched in September 2018 in Dhaka. We ran quite a comprehensive story on the day Kormo launched. From Google Launches Informal Sector Focused Job Marketplace Kormo In Dhaka:
“In a move that is likely to have a significant impact on how people find jobs and employers hire in the informal sector in Bangladesh, Google has officially launched a new job marketplace in Dhaka for the informal sector jobs, aptly named Kormo. The mobile-based platform will connect job seekers and employers while also helping job seekers to level-up their skills by providing career development tips and information. Kormo has been developed under Google’s Area 120, an incubator program that deals with developing new innovative solutions for emerging markets inside Google.”
In simple, Kormo is a two-sided marketplace serving job seekers and businesses. It aims to solve multiple consequential problems for each side of its platform. Although it plainly describes itself as a “jobs and careers app that connects job seekers to businesses”, its ambitions are higher.
Job as a category is critical and interesting for several reasons. For employers, hiring the right people is of paramount importance - meaning in an ideal world they should be happy to invest in ensuring that they get to hire the right people. For job seekers, getting a job and then getting the right job, these are critical goals and in order to increase her odds of getting the best option, she should be happy to invest as well. There are natural incentives for both parties here. Then and again, you have to be able to align these incentives and part of Kormo’s work lies there.
To that end, one of the important ambitions for Kormo is to fix the broken job search problem in Dhaka. Although it looks like a problem of job seekers from the outside, it is not. It is an even bigger problem for businesses. From Kormo co-founder Bickey Russell:
“The potential of technology has led to a lot of disruption across many sectors. As a consumer in Dhaka, you can book a ride, buy your groceries and order pizza, all from your phone. All pretty easy to do and pretty effective too.
But finding a job hasn’t really changed that much in cities like Dhaka. Online job boards have been around for a while, but their primary model is based on providing users with a “directory of job listings” — you need to know what you’re looking for and minimal additional support is provided. We ran a study with local research agency, Kaizen, of over 250 respondents and the number 1 way respondents said they knew about available jobs and got connected to them was through offline contacts. Such personal networks were also seen as the most effective channel, by far. But relying so heavily on personal relationships is not scalable, nor is it effective. Many of these respondents said that they were unemployed for weeks and months before finding a job that met their need. A large portion also remained unemployed and gave up on the job search altogether.
We’re trying to address this broken system by using technology to better understand the job seeker needs, competencies and potential. With this insight, we believe we can help by bringing jobs and career-assisting tools directly to the user. We look at job search not simply as a transaction the job seeker is looking to make, but as a journey, they are embarking on to build grow in their careers.”
Job seekers are one node in the Kormo universe and an important one which connects everything else. That’s the supply side if you consider Kormo as an aggregator equivalent to that of drivers in the world of Uber. The only distinction, however, is that Kormo’s supply exerts far greater influence on its demand-side allowing Kormo to have greater control on demand thus controlling supply. After a certain threshold, more job seekers means Kormo will be able to attract more businesses and vice versa. That’s why Kormo wants to do a good job at solving problems for the job seekers - giving them a seamless and reliable experience and helping them build portable digital reputation profile through ranking and rating and other mechanisms.
If you pay attention, Kormo aims to build a platform that solves multiple problems for job seekers starting from 1) making job search and finding opportunities seamless and reliable 2) an end to end service for job seekers 3) digital resume for job seeker 4) career development opportunities for job seekers through educational content and courses.
These facilities for job seekers are essentially tied to what Kormo aims to build for employers and businesses. Hiring is a challenge for businesses in Dhaka. There is no disagreement about that. This is a complex challenge - 1) finding right candidates 2) managing the entire hiring process, particularly screening a challenge when you receive a disproportionate number of applications for a single opening. By building a seamless experience for job seekers and then helping them build digital resumes and reputation scores, Kormo aims to solve both of these problems for the businesses. Thus increasing businesses’ dependency on Kormo. More on that in a moment. Before that let’s explore how the entire dynamics operate.
Over the past few years, Dhaka has seen a consistent growth of a host of new types of informal jobs fueled by a new generation of technology companies and growth in the urban economy. From Bickey Russell:
“The jobs are mostly in the services sector and there is massive demand and supply for them. They range from delivery workers to retail and hospitality staff, all the way to call center operators and data entry specialists. Some of the jobs are similar to what would typically be known as “White Collar”, others are more close to definitions of “Blue Collar”. Many would be considered “Informal Jobs”. Some of the jobs can be considered “Gigs”, some are “Part-time”, some “Full-time”… In the absence of a clear definition, we’ve started calling them “Urban Jobs.”
Although this is a growing segment, there is no formal platform addressing it, thus creating challenges for both the businesses and job seekers. Kormo aims to address this challenge. The interesting part is that Kormo entering into this vertical does not mean that it can or will do only informal jobs. Rather starting with a segment that no other platform is serving allows Kormo to quickly become dominant in that segment and then slowly and surely expand to other more mainstream verticals. That’s taking a leaf straight out of Christensen's disruption theory.
Bangladesh is a country of young people. The median age of the country is about 26 years. There is a high hope that youth will lead to a prosperous future. Concerns are there as well. Opportunities for young people are scarce at best. Over 2 million young people enter the workforce every year but unemployment and underemployment continue to grow. The jobless rate among the youths (age 15-24) doubled in the last 7 years between 2006 and 2017 (ILO Asia-Pacific Employment and Social Outlook 2018). At the same time, finding opportunities due to the challenge in the system is a problem for many young people who are looking for opportunities.
There are job marketplaces but they seldom cover informal sector jobs that employ 86 percent of the country’s labor force. There is no dedicated job marketplace or structured system for them. As a result, job seekers often miss out on opportunities.
This is one side of the coin. The other side is employers often go through inefficient ad-hoc processes to hire people.
I had an opportunity to attend a session organized by Kormo for senior human resources officers at different companies across sectors in Dhaka. There were representatives from about 10-15 companies and one thing everyone agreed that hiring is not easy in Dhaka.
As we discussed earlier, there are several high-level challenges. The number of good and capable people are slim. Screening applications is an effortful job. There are some bizarre problems as well such as applicants not appearing for interviews, failing at job, leaving the job without prior notice and so on. As Kormo learns more about its users, it can design systems and products in order to solve these challenges. It is doing education which is of course on the side of creating more able people. It is building a reputation model and building system to nudge people to behave better through notifications and app. Being on the mobile, Kormo enjoys the benefit of staying closer to its users.
Kormo aims to connect all these missing pieces and then some more to address challenges that exacerbate both job seekers and employers. Kormo says it has built an excellent platform for the job seekers and already helped thousands of job seekers and businesses. At the same time, it has been using the data it generates through job seekers-and-employers-matching to build a better reputation model for the job seekers that could potentially improve the trust factor in the entire hiring process.
Like many consumer tech products today such as Uber where both service providers and service receiver rate both parties, Kormo is allowing both the job seekers and employers to rate each other on specific metrics and in the process building a reputational model for both parties that can improve the entire hiring experience.
Essentially, Kormo is building an aggregator. On the one hand, it is aggregating all the opportunities meaning jobs that should bring job seekers on its platform. More job seekers mean it can ensure a better match for the employers meaning increasingly employers will depend on Kormo for hiring which will, in turn, bring even more job seekers on its platform giving it greater control on both supply and demand. Eventually, Kormo can leverage its relationship with both parties - helping job seekers to upskill and also allowing employers to reach a better target audience.
To that end, it makes perfect sense Kormo does not call itself a job marketplace rather a “jobs and careers app”. Career is an important word here. Kormo has already started investing in developing career-related educational content. It is likely that it will move increasingly towards that end of the market because of both there is a skill gap in the market that bothers employers and there is a lack of career development education in general that hampers job seekers in the process of their personal development. Interestingly, Kormo sits at the nexus of these two groups and could effectively bridge both sides.
Kormo has grown a bit over the past months. It has over 400 active employers on its platform and it is matching hundreds of jobs daily. The platform is not fully open for the businesses yet. It has an Early Access Program (EAP) for businesses through which it is working with employers. Like any other early-stage technology companies, Kormo focusing on urban jobs is understandable. Kormo says its focus, for now, is broad services sector within which it covers about 30 different verticals across retail, hospitality, logistics, and so on.
Logically, Kormo will expand beyond these verticals in the coming days. Market-wise there are so much to be done starting from expanding to other gig works and more mainstream jobs. To that end, Kormo is going to be a very different platform in the near future and likely to exert greater influence on the future of work and employment in Bangladesh. Rest depends on how good a job it does at execution and responding to market needs.
Photo courtesy: Kormo