Paraform Secures $3.6M in Seed Funding to Link Startups with Recruiter Networks

Layoffs typically evoke concern and support for the employees affected, yet the impact on recruiters, who are often let go as well, receives little attention. In the significant layoffs across tech firms during 2022 and 2023, many companies slashed their recruitment teams by up to 50%.

Recognizing this gap, Paraform— a recruitment platform tailored for startups— sees potential in the pool of laid-off recruiters who have since ventured into their own businesses. The platform aims to assist startups in sourcing talent and accessing a wider network. Recently, Paraform secured a $3.6 million seed funding round led by A*, a venture capital firm founded by Kevin Hartz, co-founder of Eventbrite and Xoom, and Airbnb’s first investor.

"Amid the 2022 and 2023 tech layoffs, around 100,000 recruiters lost their jobs, prompting many to forge their own paths in the recruitment space," stated John Kim, CEO of Paraform, in an exclusive interview. "This shift has created a wealth of independent recruiters with exceptional skills and valuable networks, eager for innovative work arrangements."

To date, Paraform has onboarded thousands of recruiters and has assisted over 200 companies in filling vacancies. The platform charges a subscription fee for job listings and a success fee upon a successful hire. “The listing fee fosters commitment from startups to engage with recruiters, ensuring a mutually beneficial marketplace,” Kim explained.

Paraform not only serves early- and late-stage startups but also collaborates with larger in-house talent teams for difficult-to-fill positions. “More than half of our clients have robust internal recruiting teams but continue to use Paraform to tap into recruiter networks without the expense of full-time hires, giving them the flexibility to scale their hiring efforts,” Kim noted.

The latest funding raises Paraform's total capital to $5 million, following its pre-seed round in March 2023. Since then, revenue has multiplied tenfold, with over 100 new clients onboarded, and the company has expanded its team. In its inaugural year, Paraform generated over $1 million in revenue with just three employees.

Notable investors in this seed round include DoorDash co-founder Evan Moore and executives from firms like Affirm, Hightouch, Palantir, and Ramp, as well as returning investor Primer Sazze Partners.

With the new funding, Paraform plans to broaden its reach in the U.S. and hire additional engineers and operators to meet rising client demand. The startup is also looking to expand into international markets. Currently, with a four-member team, they aim to double their workforce this year.

Paraform has begun piloting its services in the EU, Korea, and Australia, experiencing strong demand for its collaborative model with headhunters. "We’re eager to extend our global footprint," Kim expressed.

The company has recently introduced an enterprise product and is working to diversify its platform for roles beyond software engineering and go-to-market positions. "We’re branching out into research, science, manufacturing, and defense roles due to the surge in interest from prospective clients," Kim added.

Paraform believes that recruiting remains fundamentally a “human-to-human process.” They aim to amplify this aspect using technology such as AI to streamline hiring for both recruiters and startups. According to Kim, AI will help recruiters grasp hiring managers’ preferences better by summarizing feedback and identifying common reasons for candidate rejections, ultimately refining the candidate selection process.