A few years ago when Jerome Ternynck told me he was launching SmartRecruiters, a Free applicant tracking system, I thought he was a little crazy. Applicant tracking is a tough business. All those years of hard work getting Mr. Ted off the ground must have made him a little mad. Was he doing this for spite? Was it just for fun?

Well little did I know he was out to change an industry. Today SmartRecruiters announced $5 million in Series A financing led by Silicon Valley’s Mayfield Fund.  

Unless you've been living under a rock, you've noticed a lot of moving and shaking going on in the HR software industry. While mergers and acquisitions are always interesting for industry analysts, the most recent bout of activity – including the acquisitions of Rypple and SuccessFactors by Salesforce and SAP (respectively), as well as the announcement of VC funds flowing into the market (with large investments in SmartRecruiters  and iCIMS) – are particularly exciting. Why? Because this activity is driving change in areas of talent management technology that we primarily paid lip service to in 2011.

In the late 1990's the explosion of the Web revolutionized the applicant tracking market. There were so many ATS products and it seemed like a new one popped up every week.  The market expanded, inevitably consolidated, and then more recently it has been moving horizontally to become the Talent Management Suite. In the last few years there has been lot's of speculation about whether or not the ATS is dead or dying.

But I am here to tell you that the ATS Lives! Only now it's called the Social Recruiting Platform.

In the last 20 years companies have spent millions upon millions of dollars on applicant tracking systems. There are some organizations in their 4th generation of ATS, switching vendors about every 5 years.

The industry has come a long way, from proprietary to open databases, Client/Server to Web based, and now SaaS and Social. But even as the investment continues to rise there is one thing that will never cease to amaze me.

Recruiters treat the ATS as "optional." Why do companies let them get away with it?

Last week during the ERE Expo, Cornerstone Ondemand announced the general availability of their long awaited recruiting module called Recruiting Cloud. This is a major milestone toward the completion of their end-to-end Talent Management Suite which includes the Performance Cloud (with Comp and Succession), and Learning Cloud all of which have been developed organically and reside on the same platform. No acquisitions.

As soon as I heard the news, I hurried to the exhibit hall to get a demo:

I am sitting in the Computer History Museum in Mountain View, CA getting ready for the start of the Recruiting Innovation Summit put on by ERE.  There is an excitement in the room that I have not seen for quite a while. Later today there will be presentations from 6 technology start ups in a competition that will reward the winner with $10,000.

But what's amazing is, there are enough new start ups in the recruiting technology space we could fill a week long conference. It reminds me a little of what it was like in 1999.

Recruiting is sexy again. 

When Resumix made it's debut circa 1990 with an artificially intelligent search engine, the concept of automatic match was born. It's when the computer takes data from a requisition/job description and uses a black box algorithm to match it up with the data from a resume/profile.

You used to hear vendors say things like "with our proprietary technology we can automatically match the best talent to your jobs, saving you time and money." Oh wait, we are still hearing that today?!?

But so far, I think auto match has been a little more than a gimmick. Here is why: 

Let’s be honest, recruitment can be expensive both in terms of time and money. But does it really have to be that way?

In this Three Part series we will list some great free tools out there that recruiters can use to find and hire people for free. Even if a cost per hire of $0 is unrealistic for most employers, there are many ways to keep the costs as low as possible.

Free job boards……..are you using them? 

Jerome Ternynck, Founder and CEO of SmartRecruiters--and previous founder of MrTed--has an interesting perspective on recruiting. “Recruiting is not a process,” he told me firmly, “and therefore it cannot be automated.” While there are processes involved, recruiting itself is a business strategy, which software tools can help execute.