Frankfurt Axel Springer is pressing ahead with preparations for the IPO of its Stepstone job advertisement portal. The company has selected Goldman Sachs and Morgan Stanley to lead the transaction, which could take place in the second quarter of 2022 if the market environment is favorable, as several people familiar with the transaction said. Rothschild acts as what is known as an IPO advisor and helped, for example, with the selection of banks.
The recruiting platform could be valued at around seven billion euros when it was issued, which would correspond to 25 times the operating profit (Ebitda) expected for 2023 of a good 300 million euros, it said. That would be roughly on par with listed rivals such as Seek and Ziprecruiter from the USA or Indeed from Japan.
After a slump in the coronavirus pandemic, Stepstone expects an Ebitda of 209 million euros this year, according to financial circles. Sales should reach around 800 million euros this year and rise to more than one billion by 2023.
“Our platform is well positioned to create value in a world with a dramatically increasing skill shortage. In order to support our sustainable growth path, we are continuously examining all possible options, ”said a Stepstone spokesman. Springer and the banks declined to comment.
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The global job agency market is worth 170 billion euros, but only a small part has been digitized. Stepstone believes that when looking for skilled workers, companies are increasingly relying on job portals that use algorithms and artificial intelligence to achieve the best matching results. Population numbers are stagnating in the major industrialized nations, and competition for well-trained skilled workers is increasing. Intermediaries using new technology promise companies to get the best results in doing so.
Job portals such as Stepstone or its most important competitor Indeed are also among the most important search channels for applicants to find new employment opportunities. Stepstone recently reported 18 percent more job advertisements than before the pandemic. Such values not only give an insight into the job market, but also describe the Group’s sales situation, after all, the Springer subsidiary earns money with every offer placed. At the beginning of the pandemic, the number of job applications had fallen dramatically.
Axel Springer is no longer on the stock exchange
The parent company Axel Springer has not been listed on the stock exchange since the financial investors KKR and CPPIB entered the market in 2019. At that time, the equity of the publishing group was valued at 6.7 billion euros, including debts, the valuation was nine billion euros.
With a stake of 35.6 percent, KKR is the largest Springer shareholder, followed by the publisher’s widow Friede Springer (22.5 percent), CEO Mathias Döpfner (21.9 percent) and the Canadian co-investor CPPIB (12.9 percent) .
The Springer Group includes newspapers such as Bild and Welt, magazines such as “Computer Bild” and “Rolling Stone”, but also the business portal Business Insider and, most recently, the US newspaper “Politico”.
Stepstone benefited from the entry of the major US investor into Springer. Since then, the media company has focused more strongly on digital content such as Stepstone or the real estate portal Immowelt, the proceeds of which could replace the dwindling classifieds business of newspapers. Stepstone boss Sebastian Dettmers once described KKR’s entry in the Handelsblatt as a “stroke of luck”. Since then, Stepstone has had the financial means to advertise at train stations or in stadiums.
According to its own information, Stepstone has over 16 million visitors a month, publishes 600,000 job advertisements from 120,000 employers and processes around 100 million applications. The company has more than 20 brands and employs 3,600 people in more than 30 countries.
Focus on big data and machine learning
Around 1000 of the employees work in the field of big data and machine learning. This shows the importance of AI-based processes for Stepstone. Through the use of algorithms, applicants and companies should better come together on the platform. Stepstone also uses the data it has gained to forecast the unemployment statistics on a monthly basis and only deviates minimally from the official values of the employment agency.
Axel Springer had gradually acquired the originally Norwegian company Stepstone by 2009 – for a valuation of 137 million euros. The Berlin media group had been involved in the Germany subsidiary since 2004.
Axel Springer had recently made headlines not with business developments, but with the resignation of Julian Reichelt as editor-in-chief of the “Bild” newspaper. Axel Springer boss Mathias Döpfner had admitted in a video message to the workforce of the “Bild” newspaper that Reichelt should have been parted with six months ago.
According to an internal investigation into allegations of abuse of power in the spring of 2021, Reichelt is said not to have clearly separated private and professional matters and to have had a relationship with a “Bild” journalist.
More: The Reichelt case is also a Döpfner case – and for the Springer boss it is probably not over yet