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From The Front Lines: Melissa Tran (EarlyDay)

Patrick Mc Govern

Patrick McGovern

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Michael Brown

June 23, 2023
B2 B Marketplace Interview Early Day v2

The Bowery Capital team is continuing our blog series covering B2B Marketplaces. We are doing deep dives on various companies, interviewing founders and investors, and learning what it takes to build success in the B2B Marketplace arena. This week, Melissa Tran, Co-Founder of EarlyDay, answers some of our questions. You can read all of the posts in our series by going here.

Can you tell us a little bit about EarlyDay and what inspired you to launch this marketplace?

EarlyDay is a talent marketplace dedicated to early childhood educators, and we make it faster and easier for preschools and childcare centers to hire qualified, pre-screened teachers for their classrooms. My co-founder Emma Harris and I previously worked together on another startup, where we were building a marketplace for fitness classes in Asia. When we started working on EarlyDay, Emma was pregnant with her son, which inspired us to look into the early childhood education (ECE) industry and made us wonder whether there could be an opportunity to build a marketplace of childcare centers. During our initial research, we had conversations with over 100 different childcare center owners and preschool directors, and learned that their number one operational challenge is hiring and retaining teachers. Using those first learnings, we ran a small pilot and everything really just snowballed from there as we got the positive traction and feedback from center owners.

You mentioned pre-screening for the teachers you have on the EarlyDay platform, can you tell us a little bit more about how that works and what it entails?

There are different qualifications for preschool teachers depending on the state that you are in. One thing that we learned early on is that the qualifications in Texas vs. New York vs. California can be very different. What we do is we screen for the minimum requirements in a given state, for example, that they have a high school diploma and are at least 18 years old. On top of that, we collect other ECE-specific data from the teacher–for example whether they have experience with a particular educational philosophy or with a certain age group–which allows us to then match teachers with job opportunities.

When you were first getting EarlyDay started and looking for initial liquidity, did you focus more towards trying to onboard schools or trying to onboard teachers? Was there a half of the market that was more receptive?

Emma and I split up the market–she focused on schools (demand side) while I focused on onboarding teachers (supply side). That worked really well, because we could move in lockstep and build up both sides of the marketplace essentially simultaneously. We also had a narrow geographic focus on New York City, and within New York City, in Manhattan. And from there, we also concentrated first on posting only one specific job type–assistant teaching roles–so that we could further build up concentrated liquidity of supply and demand more quickly. We would allow other ECE peripheral roles (i.e., directors, food handlers, substitutes, etc.) to be posted only later on.

In terms of onboarding those assistant teachers, were there any levers that were particularly useful as you were looking to grow EarlyDay’s supply?

We knew that improving the search experience for those teachers with better data and user experience was key. From speaking with teachers, we knew that they were confused by the jobs that they were seeing posted on other job boards; the qualifications were all over the place and hard to understand. They also didn’t provide great transparency into compensation or benefits. We knew that if we zoned in and made those UX and data improvements, we would be able to attract teachers to use EarlyDay to look for roles.

On the school side of the market, how did you develop liquidity there? Were there any tactics that were particularly effective in finding those early adopters?

At the very start of EarlyDay, we went to a set of pilot school partners and said, “let us be your internal recruiting team.” These were small, family-owner, owner-operated schools (which represent 90% of the overall childcare center industry). The owner or director of the school is the one who is in charge of hiring–but she’s also the head of marketing, head of parent communications, head of curriculum, head of everything really. They really wear every hat for their center. When you offer to take something off their plate, they are more than happy to let you do that. So we worked really closely with these directors from the get-go and they gave us so much valuable insight and feedback which we used to build out our tech platform. As we matured, we have obviously evolved from that high-touch approach to our completely self-serve platform that we have today.

How does EarlyDay monetize and has that approach to monetization changed over time?

We monetize by charging schools a subscription fee to use our platform. All childcare centers must maintain strict teacher to student ratios which are regulated by the state, for example one teacher for every 10 preschoolers. This means when they unexpectedly lose a teacher, they need to be able to hire quickly. Otherwise, they may lose the ability to keep an entire classroom open and be forced to close until they can reach mandated staffing levels. We know from schools that turnover is really high in this industry–it is about 40% annually, if not more. This is why we hear from schools that they are “always hiring”-they want to be able to maintain a steady stream of potential candidates to be able to quickly fill a staffing shortage. We built our platform to be a partner and a valuable tool for schools to use on an ongoing basis to source great talent, hence why an ongoing subscription fee makes sense for us.

On the demand side, is that an ideal teacher profile who has really gravitated so far towards using EarlyDay?

What unites the applicants that we have on EarlyDay is their desire and passion for working in the field of early childhood education. This is also what makes the site so powerful for the employers–they know that every applicant they receive has not only been vetted by us but also is a self-selecting pool of folks who genuinely want to work with young learners.

When teachers create a profile on EarlyDay, they can really highlight what makes them a great teacher, and their specific experiences, for example if a teacher has used ASL in the classroom before, or has extensive experience with teaching toddlers using the Montessori method. We also recently launched a new feature, which is recorded video interview questions and answers. Teachers can record a series of videos answering questions like, “tell me about your experience working with children” or “what makes you a great teacher?” Schools can review these video clips asynchronously and get a great sense of who the teacher is. This is saving a ton of time for both sides, and has even replaced the need for a phone screening interview for some employers.

Are there any common objections you face from schools when you try to pitch them on EarlyDay? I am curious how that onboarding and sales process goes.

I think an aversion to tech and also a lack of time are two major objections we hear from schools. So even schools that are actively hiring and they are desperate for teachers, when we get them on the phone they are always running around taking care of a million different things that come up in ECE. From a product perspective, we are always thinking about how to make each step of the hiring process even easier and faster for them. We’ve recently introduced a few features that are aimed at doing just that–including recommended educator matches and qualification scores for applicants based on the job requirements–and we’re working on further building out our ATS to include automation, interview scheduling, and onboarding tools.

You originally come from a boutique fitness marketplace background-as you have ramped up EarlyDay, have you noticed anything unique about the early childhood education space and how that may influence marketplace design?

One thing that is similar in ECE to the boutique fitness world is that studio owners and ECE owners both function as jack-of-all-trades for their businesses. Given how busy they are, you really need to simplify your value proposition for them and that is what we try to do with our platform. Like in fitness, ECE directors are also really passionate about what they are doing and their teams mean everything to them. Neither Emma nor I have direct experience in education or in early childhood education, but we have built our team around people who have worked as early childhood educators themselves, or have previously worked at other ECE SaaS companies and labor marketplaces. Those different viewpoints have been really important!

Can you tell us a little bit more about some of EarlyDay’s features that go beyond just sourcing new teachers?

Since we launched, we have been focused primarily on recruiting and hiring, but we’re really excited to build out tools that will help schools with the staff onboarding process as well. As you can probably imagine, there are rightfully quite a number of hoops that a potential teacher must jump through to be able to work in a classroom with young children. Depending on the state, this usually includes passing background checks, taking fingerprints, collating educational certificates and diplomas, passing medical clearances, and submitting letters of reference. There is also pre-service training and ongoing annual professional development training required of all staff. We can help connect teachers with this training and help employers stay compliant with training requirements each year. At the moment, all of this information is being collected and submitted manually to the licensing bodies, so you can imagine there’s a lot that we can do to help schools collate and maintain these staff records.

Is there advice you have for other entrepreneurs looking to launch a marketplace?

Something that I think was key for our early traction was that we initially used various no-code platforms to build the MVP for our labor marketplace. This allowed us to inexpensively test our product in the wild and gain enough traction to raise money and eventually hire someone to build out our tech (shout out to our amazing CTO James Watling).

Secondly, I would say to get inspired by other marketplaces in industries that have similar dynamics as yours. We found a ton of inspiration from looking at the nursing talent marketplaces–similar to the ECE industry there is a massive labor shortage and strict regulations around certifications. There’s a lot that we learned from them around automated candidates and employer matching, bringing transparency to compensation, and building out and providing resources to the jobseeker community.

If you liked “From The Front Lines: Melissa Tran (EarlyDay)” and want to read more content from the Bowery Capital Team, check out other relevant posts from the Bowery Capital Blog. Look out for more content on B2B Marketplaces from us in the coming weeks.