A hire purpose: The fight to recruit and retain the best talent

When dating app Bumble floated on the Nasdaq in February 2021 – closing its opening day’s trading up 63% to achieve a market cap of $8bn – it generated headlines globally. This was largely due to the fact the founder and CEO, Whitney Wolfe Herd, had become the youngest woman ever to take a company public. At 31, she had also become the world’s youngest self-made female billionaire. Yet once a tech startup IPOs it usually means that carefree and experimental mindset is superseded by a fixation with quarterly targets and the gyrations of the firm’s share price. And, so, Ryan Murton decided to move on in March 2022, around a year after the float, from his role as director of organic acquisition based out of Bumble’s Soho office. His intention after a four-and-a-half-year spell with the company was to take a few months off to recharge and move house. The London-based 30-year-old didn’t have to wait long for an offer of work, though, as the founders of esports betting-led startup Midnite quickly reached out. “They made me an offer on the day I left Bumble,” Murton reveals. “I had quite a few messages about jobs, but these guys literally sent me a contract on the day I left without an interview needed.” Two months later, he was installed as VP of organic at the firm – which recently raised $16m in a Series A funding round – and back in the gambling industry after previous digital marketing roles at Oddschecker, Betfair and Paddy Power. The way Midnite swooped for Murton illustrates just how red-hot certain parts of the jobs market are right now as companies large and small battle to recruit the best talent, especially in the UK’s particularly tight labour market. Indeed, the Office for National Statistics (ONS) revealed on 17 May that the UK’s unemployment rate hit a 48-year low for the first three months of 2022 at 3.7%, down from 4% in Q4 2021. What’s more, there were fewer people looking for work than there were openings for the first time since records began, as vacancies reached an all-time high of 1.3 million from March to May. “You can definitely find good people but keeping them is a challenge because it’s very easy for them to get poached,” acknowledges Smarkets’ chief people officer (CPO), Céline Crawford, on a Teams call from the betting exchange’s HQ at London’s St Katharine Docks. “We get people in and train them very well [but] it’s very easy for bigger companies with deeper pockets to then take those people.”

Talent pool

The digital skills shortage isn’t a new phenomenon, yet salaries have been increasing, and in some cases rocketing, among tech companies to attract and retain the best talent. For example, it was reported in May that Microsoft planned to “nearly double” its budget for employees and boost stock compensation by 25% in order to stay competitive. According to Glassdoor, a graduate software engineer at Microsoft earns around $163,000. And earlier this year, in February, Amazon announced it was more than doubling base salaries for white-collar and tech employees to $350,000 to bring pay in line with other big tech firms like Google, Apple, Meta (formerly Facebook) and Microsoft. According to an analysis by the Wall Street Journal, Google parent Alphabet and Meta have the highest-paid median workers at nearly $300,000. “Not only are we competing against competitors but we’re competing against the tech industry and many other sectors as well,” points out Gavin Hayward, chief human resources officer at Kindred Group, which employs more than 2,000 people representing 60-plus nationalities across 15 offices. Sweden, where the company operates four brands (Unibet, MariaCasino, bingo.com and Storspelare), is home to most of the firm’s tech staff and where Kindred’s employee attrition tends to be lower than elsewhere, Hayward says. “Having said that, Sweden is a small talent pool and always has been – we have to work extremely hard to push our offering there,” the Brit explains. “The Unibet brand is well known there but maybe the Kindred brand less so.” So, news in May that Swedish fintech Klarna was laying off 10% of its global workforce – around 700 people – would have piqued the interest of igaming companies with a presence in Sweden. Another unicorn, rapid grocery delivery app Gorillas, recently announced the axing of 300 jobs at its Berlin HQ, underlining the need for many VC-backed startups to slash expenditure amid mounting labour costs, spiralling inflation and falling valuations. According to Layoffs.fyi, which tracks the number of employees at tech startups being let go, nearly 30,000 people were laid off in Q2 2022 at the time of writing. This is by far the highest quarter since Q2 2020 and the peak of the Covid-19 pandemic. “There may be some opportunities to pick up employees on the back of that [Klarna’s reduction in headcount]. We are always on the lookout,” Hayward remarks. Like Kindred, Hero Gaming, the Scandinavia-focused operator behind brands including Boom Casino and Casino Heroes, has offices in Sweden (Malmö) and in St Julian’s in Malta. “Technology is the most challenging area,” confirms CPO Marie Theobald on filling roles at the nine-year-old business. What makes things slightly more complicated for Hero Gaming is that its products are coded in the programming language Ruby (14th most popular programming language in the world, according to a 2020 Stack Overflow survey, with 7.1% of respondents being Ruby on Rails developers). “It’s a very difficult skill to find because a lot of developers out there use different code. We do manage but it just takes longer.” Theobald adds: “But when it comes to technology and developers, it isn’t just a gaming challenge, it’s a worldwide, across-industry challenge.” LinkedIn data suggests the median time to hire a software engineer is 49 days. This is the time between the date the job was first listed and the start date posted on the successful applicant’s LinkedIn profile. At the other end of the spectrum, it usually takes 34 days for customer service positions. It can be even quicker than that for operators hiring customer service staff dedicated to the more common languages. Kindred has its customer service staff based out of Malta. “In Malta we have a strong brand presence, coupled with a fabulous office and a really strong employee offering,” Hayward comments. Nevertheless, he concedes it isn’t always so easy to persuade people to relocate to the Mediterranean island despite its 300 days of sunshine a year. Retention is also a challenge, particularly with Malta employing thousands of people engaged in igaming, so flitting between companies is commonplace.

The grass is greener…

The aforementioned ONS data showed that the number of people moving jobs in the first three months of the year hit a record high in the UK “driven mainly by resignations rather than dismissals”, while a survey released in May by PwC found that one in five UK workers said they are likely to switch jobs in the next 12 months. Anecdotal evidence, based purely on EGR’s LinkedIn feeds, seems to suggest a rise in the number of people finding new roles within this industry if the notifications encouraging a congratulatory response are anything to go by. New businesses are seemingly fuelling the igaming merry-go-round of late, too. For example, 888Africa – a joint venture between 888 and a bunch of seasoned industry professionals to enter regulated African markets – continues to add to its line-up with new hires. It has also been difficult to avoid the hiring spree sports streaming platform DAZN has embarked on ahead of the launch of its new sportsbook, DAZN BET, in the UK and Ontario. Entain bosses probably feel more than a little aggrieved over how senior talent has been headhunted to fill key functions of the venture backed by multi-billionaire and business magnate Sir Leonard Blavatnik. Over the past few months, DAZN BET has raided Entain for a CMO (Simon Gatenby), a head of UK and Ontario (Shane McLaughlin) and a CTO (Sandeep Tiku), to go along with an EVP of betting and gaming (Ian Turnbull) hired last September. And, of course, Shay Segev was poached just six months into being ensconced in the hotseat at the FTSE 100 firm and is now CEO of the whole operation at DAZN. Mark Kemp was recruited from BoyleSports to head up DAZN BET, while other senior staffers have joined from Flutter, William Hill and 888. “Because other companies have vacancies, which they’re not managing to fill, they are directly poaching employees,” states Theobald of Hero Gaming, which in February announced former William Hill International MD Patrick Jonker as its new CEO. “I see direct headhunting happening a lot more, unfortunately. Our own employees tell us, ‘This company approached me’ or ‘This company messaged me on LinkedIn.’” Legal sports betting and online casino now being live in 31 and six US jurisdictions, respectively, has also sucked staff at EU firms across the pond. “As various global markets regulate, notably the US, there is an obvious lack of talent,” asserts Ben Fried, formerly of Betfair and now executive search partner for the betting and gaming practice at headhunting firm SRI. “The igaming sector has always been fairly self-contained, and with the state-by-state and other market regulations, operators need more and more people to cover those markets. The requirement for talent at all levels has increased. At the senior level there just aren’t enough experienced individuals.” This is also partly due to experienced people deciding to call it a day and leave the industry for whatever reason, with igaming skills relating to product, marketing and operations easily transferable to other sectors. “But then a lot of people realise that igaming tends to pay better than market, so it’s an incentive to stay,” Fried counters. When it comes to filling C-suite positions, Kindred’s modus operandi is typically to promote from within rather than hiring and onboarding people from outside the company or industry. “We tend to hire at a lower level, develop them and promote from within for a lot of senior management and leadership positions,” Hayward confirms. “However, I see it as my role to encourage broader thinking around hiring, not only because talent pools are tight but there is a huge body of evidence out there that demonstrates if you hire more diverse talent the organisation will benefit in terms of innovation, loyalty and different ways of thinking.” That loyalty he refers to clearly extends to the top tier of the business judging by length of service. For instance, chief product officer Erik Bäcklund has been with the Stockholm-listed firm since 2005. Chief legal officer and compliance officer Ewout Keuleers first joined in 2006, while CMO Elena Barber has spent 12 years at the business. Hayward himself has a decade under his belt at Kindred, and the man at the top, Henrik Tjärnström, 51, is one of the industry’s longest-serving bosses; the phlegmatic Swede was promoted to CEO in 2010, two years after arriving at Kindred (then Unibet) as its CFO. Indeed, the median tenure throughout the company at Kindred, says LinkedIn, is 3.5 years compared with 1.6 years and 1.5 years at Entain and Flutter, respectively. Going forward, Kindred itself will be on a hiring spree as the firm looks to sever ties from Kambi and develop an in-house sportsbook. Rival operators are on their own hunt for talent, though. LeoVegas, which is subject to a $607m bid from US casino giant MGM Resorts, is currently trying to fill more than 100 roles, including 36 in technology and 22 in marketing. Bet365 has over 220 advertised jobs at the time of writing on its careers page, while Betsson is seeking to find people for almost 300 open positions in Malta, Stockholm, Athens, Tallinn, Budapest and Latin America. Yet what could become more of a trend is operators buying specialist businesses to acquire talent all in one go. Like Bally’s did with its purchase of Manchester-based digital agency Degree 53, or when PointsBet paid $43m last year for sports betting solutions firm Banach Technology. “So-called ‘acqui-hires’ where you buy a whole business to repurpose it for your requirements,” Fried says.

Remote control

For igaming companies searching for candidates, the net is being cast far wider now that remote and hybrid working has become ubiquitous, accelerated by Covid-19 and lockdowns. More data from LinkedIn, published in February, revealed how remote job listings in the US received 50% of all applications despite accounting for less than 20% of all vacancies posted. In other words, roles where staff are untethered from office workstations attract more interest than onsite openings. That’s good news for firms willing to hire remote employees, not so good for jobseekers who are theoretically competing against candidates from across the globe rather than those within commuting distance of offices. Smarkets’ hybrid working policy involves staff spending three days in the office and two days working remotely. In fact, they can work from anywhere in the world for up to 20 days a year. KaFe Rocks, which came seventh in the 2022 edition of the EGR Power Affiliates rankings, has offered fully remote working since February 2018 when the company was established, although it does have an HQ in Malta for those who wish to go into the office. “Pre-Covid, it was one of our biggest USPs and a big competitive advantage for us. Now everyone is doing it,” says CEO Simon Pilkington. To stand out again, especially seeing as nine-to-five in the office is no longer the norm, the Glitnor Group-owned affiliate has since January allowed its 180-strong so-called “Rocketeers” to take unlimited paid annual leave. “It’s not like you can book in six months and disappear the next day. Like the remote working, there are still some base rules,” Pilkington clarifies. He goes on to say: “Rather than taking an unpaid sabbatical, if you want to go over to Indonesia for three months and work every other week then we are there to support it […] but if someone were to book 12 months off, then you have to question their commitment.” Whether it’s hybrid working, greater flexibility around hours, mental health support, or, as Smarkets does, offering three meals a day in the office prepared by a chef, increasingly attractive benefits are being thrown in to compete for talent. Training and career development can be important to staff. Indeed, Kindred employee hours dedicated to training were 47,125 last year, which equates to 19.86 hours per employee, up from 9.7 in 2020. Smarkets’ Crawford says: “People aren’t just looking for money, especially with what happened with Covid. The priorities have shifted a little bit; money is important, but they’re looking at the total package […] you have to be competitive on all aspects.” While on the topic of money, Smarkets garnered media coverage for allowing employees to set their own salaries. Although this sounds almost too good to be true, you couldn’t just award yourself £100,000 when your role typically pays £60,000 per annum elsewhere. Salaries had to be peer reviewed and were published on an internal wiki. The reason for the use of the past tense is this unusual policy was recently scrapped. Crawford explains: “We stopped it because we were becoming very slow at capturing talent. And because the salaries were transparent, and we were too slow updating [salaries] internally, it created a lot of unhappiness if we were bringing in someone at a much higher rate.”

Count the cost

Wages are on the rise across many professional roles in the private sector, propelled by UK inflation at a 40-year high of 9% (soon 11%) and soaring food and fuel costs. The energy price cap – the limit energy firms can charge UK households – will rise 40% to £2,800 in October due largely to the war in Ukraine. Despite Bank of England governor Andrew Bailey trying to curb inflation by urging workers to “think and reflect” before asking for pay rises, his plea probably had little effect as the cost-of-living crisis bites. Companies have been forced to act. “Our employees are not immune to the inflationary pressures,” Hayward remarks. “Not just in the UK but in most other European countries that we operate in.” Kindred hasn’t significantly lifted salaries to address rising inflation, but regularly benchmarks its roles, and not just regarding salaries. “Clearly salary is an important factor, but it’s about having an overall competitive employee offering,” the HR chief says. Yet Murton of Midnite notes: “Benefits are great to have […] unfortunately, when inflation is running at double digits, cash is king. Central banks say inflation should start to ease later this year because of rising interest rates, which stops people spending and the amount of credit available. It’s whether you believe them or not.” High inflation, coupled with the fact that the UK is perilously close to slipping into a recession after the economy shrank 0.3% in April, could very well impact firms’ willingness to hire if customers cut back on their spending. “The likes of Entain and Flutter might be the kinds of companies where you start to see cuts in the next few months if they are struggling to grow revenue,” suggests Murton. Meanwhile, you’ve got a consolidation frenzy in the industry at the same time as new markets like North America, Latam and Africa open up. Brexit has also had an impact on the availability of talent from the EU for UK companies. Crawford comments: “There was much more talent coming from Europe before, and there is definitely not as many people available. Also, people didn’t want to come to London because they didn’t feel welcome. So it’s not that they aren’t able to, they just choose not to.” The Betting and Gaming Council claims Britain’s regulated betting and gaming industry will generate 15,000 tech jobs alone in the next five years as part of the Levelling Up agenda. The challenges caused by Brexit and purely a shortage of talent could very well mean those roles go unfilled. Plus, there will always be those who refuse to work in the sector due to being anti-gambling or appalled by a tragedy where someone takes his or her own life after racking up huge losses. Like it or not, the industry still has an image problem. “In Malta that is less of a problem; we find it more of a challenge in Sweden, especially when it comes to attracting developers,” says Theobald. KaFe Rocks’ Pilkington admits having to convince people to enter the industry because it “isn’t everyone’s cup of tea”, although he stresses the affiliate world in particular is a “vastly different and improved place” compared to the early years of affiliate marketing. What seems clear, however, is that the war for talent is likely to become even more fierce and competitive, not less so. And especially for the more specialist roles and C-level positions. “Shareholders want the best possible talent running their businesses,” Fried emphasises. “So there’s always going to be a pressure to find the best.”