High employee turnover is often a hint that a company’s human resources strategy isn’t working, but it’s also difficult for managers to identify who is thinking of leaving. HR Signal wants to make retention easier by using algorithms to predict which employees are most likely to seek another job. The worker analysis startup, which has benchmarked 50,000 job positions, announced today it has raised $1.6 million in pre-seed funding from Gammite Ventures and Aaron Grossman.
One of HR Signal’s algorithms, called the Employee Retention Engine, crunches billions of data points from public sources, market data, and peer career path data, including a million anonymized resumes. The startup uses very little internal data from its clients in order to preserve employee privacy and make onboarding new clients faster, the founders say.
Co-founder Sagy Cohen came up with the idea for HR Signal while working as a senior data scientist for a venture-backed computer vision startup. Data scientists and computer vision AI specialists are in short supply, and Cohen was constantly approached by recruiters, even though he was happy at his job. This prompted him to build an algorithm to help recruiters contact only people who are at a point in their careers where they are likely to leave their current positions.
Cohen and co-founders Andrew Spott, Daniel Gilon, and Aaron Goodman began working on the algorithm in early 2020. At first, their goal was to direct recruiters toward people who are under-promoted or under-recognized. Then at the end of the year, they had an internal case study predicting an abnormally high number of people were ready to move on from their jobs and realized there was going to be a large “turnover event” because many people felt stagnated as the result of the pandemic.
After that, HR Signal’s team decided to focus on boosting employee retention instead of recruitment. “There’s this narrative that people are less loyal to their jobs and are constantly quitting, but when we analyze the data in a large enough dataset, the trend really is potentially different,” said Spott. “Employers seek leadership positions externally and are not promoting enough from within.”