Cheers to 25 Years: From Nasdaq to Best in Class
“It was really a special moment,” said Kforce, Inc.’s CEO, Dave Dunkel, remembering the day he stood on a trading floor in New York City watching Romac & Associates – now Kforce – officially become a publicly traded entity on the Nasdaq.
“I had the privilege of standing on the floor of Prudential [Securities] on August 15th of 1995, watching the ticker symbol come across…and I was standing next to my father, who 10 years before had said to me, ‘you know what, Son, maybe someday we’ll take this thing public.’”
Dunkel laughed lightly before adding, “I said, ‘you’re crazy; there’s no way we’re ever going to do that.’”
But they did. And this August 15th marks the 25th anniversary of Kforce’s inclusion on the Nasdaq, which currently operates under the ticker symbol KFRC.
The Difficulty of Becoming a Publicly Traded Company
Kforce made its first IPO attempt in March of 1995 – five months prior to successfully going public. After successfully merging several franchisees and the franchiser into the new Romac International (predecessor to Kforce) in August of 1994, the firm had the scale to proceed with an attempted public offering.
However, the market declined in late 1994 and early 1995, which placed Dunkel and his father’s goal of taking the firm public on hold until May of 1995, when the Federal Reserve announced a rate cut and representatives at Prudential Securities and Robert W. Baird informed Romac this would be a good time to move forward with the IPO.
With the successful merger complete and investors interested in the emerging professional and technical staffing segment, the Romac team began preparations for a nationwide roadshow to capture initial investor interest.
“My favorite story [from the roadshow] is meeting with an asset management company in California,” said Dunkel, “and they looked at us and said, ‘you guys are only doing $35M a year. What are you doing taking this thing public? Why don’t you just sell it to a competitor and you guys can make a bunch of money and go home?’”
But Dunkel knew those investors didn’t understand why Romac & Associates was trying to take the firm public – it wasn’t just to turn over a quick profit. “I looked at him and said, ‘you don’t get it. We’re going to build a great company.” They took a full allotment in the offering.
Defining Our Core Values While Asking, “What Does It Mean to Be Public?”
The decision to take Romac public was about more than just gaining access to additional capital and increasing the impact of the company’s national network, according to Joe Liberatore, Kforce’s President.
Going public meant the firm would be positioned to better serve its clients and consultants, as well as its shareholders and employees. With accountability and performance now at the forefront, stock prices would directly reflect corporate decisions and our ability to execute.
In such a visible market, we wanted to maintain our reputation as one of the best and the fastest growing staffing firms in the country, while also staying true to our Core Values of respect, trust, integrity, exceptional service, stewardship and community and commitment and fun.
“The one beauty about being a public entity is that there is no hiding,” said Liberatore when asked to remember how he felt about Romac being included in the Nasdaq. He elaborated, “you’re measured continuously on a quarterly and annual basis. I think that has allowed us to become a better firm because we have to make the hard decisions to do what’s in the right interest of the business from a long-term standpoint.”
In the mid-late 90s, the staffing world was changing. Clients were looking to partner with firms that could provide nationwide talent and serve their needs across multiple geographies. Clients were moving away from traditionally large vendor lists in favor of reducing their vendors and curating long-term business partnerships with established, trusted staffing firms to fill their talent requirements.
With a Nasdaq symbol and nationwide presence, Romac was a better partner to clients’ nationwide needs through increased public visibility, a stricter auditing of financial reporting, and adherence to corporate responsibility at a time when staffing firms were competing for a limited market share across state borders.
How Has Kforce Changed in the Years After Going Public?
With staffing industry trends shifting away from printed newspaper ads and faxed resumes in the mid-90s toward a more digital job search, Romac strove to remain agile and relevant – even after its IPO.
The emergence of online job boards meant candidates no longer had to leave their house or pick up the phone to find viable employment. Because technology streamlined the process of finding talent, many industry experts predicted the demise of staffing firms, believing face-to-face communication and the recruiter/candidate/client relationship were dead.
Leadership at Romac disagreed.
Following the acquisition of Source Services Corporation in 1998 and a rebranding to Kforce.com in 1999 and Kforce, Inc. in 2001, to unify both Romac and Source Services employees under one name, after concluding the internet was just another tool, Kforce cemented its long standing belief to putting relationships first.
Instead of accepting that the advancement of technology would leave brick-and-mortar staffing services obsolete, technology provided a vehicle for Kforce recruiters to grow, strengthen, and maintain those relationships in a more efficient manner over the lifetime of their candidates’ careers.
Our vision of looking at employment as one of the most impactful decisions a person will make in their life allows us to align ourselves with the best opportunities working with award-winning companies placing candidates that trust our expertise and value the relationships we’ve built.
What Has Kforce Kept the Same in the Years After Going Public?
It wasn’t just a trendy website and new name differentiating Kforce from its competition, according to Ray Morganti, Kforce’s SVP of Technology Innovation. Morganti, who partnered with Kforce as a candidate, client, and consultant before becoming a core employee directly supporting the implementation of the firm’s technology innovation initiatives, knows Kforce has always been ahead of emerging trends.
“In 1998, understanding the supply and demand challenges within the talent acquisition landscape, Romac had the idea of creating talent in a marketplace where it was scarce,” Morganti said. By creating a series of IT bootcamps and training materials, known as the “Romac International Emerging Technologies Division,” Romac differentiated themselves by curating a bench of candidates under their employment that could be deployed to clients at a moment’s notice.
The idea caught on. Romac was now creating and supplying top IT talent to meet clients’ needs, while simultaneously assisting consultants with skill development and career progression. “No one else was doing that then,” said Morganti, “we saw a demand with our partners, and wanted to be the one to help provide a long-term solution.”
Today, as a solutions firm, Kforce still relies on emerging technology and developing deep partnerships between recruiters, clients, and consultants to reimagine how business gets done. Many at the firm believe Kforce wouldn’t be the company it is today without the relationships we’ve put first since opening our doors as Romac & Associates in 1966.
“If you want to look to the future,” Liberatore said, “you must first look to the past. Our past was rooted and grounded in relationships, and the future will be as well.”