On August 10, in response to allegations that its subsidiary, Xinhua Yingcai, had been selling resumes, 58.com asserted that they were taking the matter seriously. They promptly established a special investigation team to examine the accusations, emphasizing their intolerance for such behavior.
The company further stressed, "Xinhua Yingcai has always maintained strict controls on data access and data isolation, in line with legal and regulatory requirements. The protection of user information is of utmost importance to our strategy."
According to a report from NetEase Finance, internal documents from 58.com revealed that the company allegedly collected student resumes under the guise of recruitment and subsequently sold them to training institutions. The report, citing a former employee of 58.com, stated that the resumes were sold in two formats: by volume or packaged according to specific criteria requested by partnering institutions. Prices for individual resumes ranged from 30 to 2,000 yuan, with an average pricing between 140 to 250 yuan. Doctoral student resumes were sold at around 1,500 yuan each.
The report also highlighted that the sold resumes were sourced from Xinhua Yingcai's recruitment platform, a joint venture between Xinhua Net and 58.com's Zhonghua Yingcai. This platform primarily targets students. Apart from selling student resumes, the data indicated that 58 Group had also sold resumes from the "blue-collar" demographic, priced between 100 to 500 yuan per resume.
In defense, the company mentioned that the "Yingcai Recruitment Pulse Recruitment" platform, a collaborative project between Xinhua Net and 58.com, offers paid job posting services. Employers post genuine job vacancies, and job seekers apply through the platform by their own choice. Only the companies to which job seekers apply can download the resumes. Xinhua Yingcai does not have the authority to download resumes and denies allegations of deceitfully selling them.
In addition to the resume sales controversy, 58.com had previously been embroiled in scandals involving fake job postings. Numerous complaints on the Black Cat Complaint Platform revolve around fraudulent job interview fees. As of the second quarter of 2023, the complaint resolution rate for Beijing 58 Information Technology Co., Ltd. was 83.3%, which did not meet the standard.
Typically, after completing one of the verification processes like business license verification, Alipay rapid verification, corporate legal person verification, or a public account verification, users can post recruitment information. Despite 58.com's repeated assurances about their vetting procedures for job postings, their stringency has frequently been questioned.
For recruiters, 58.com is often associated with low-tech, basic job positions such as sales, customer service, and domestic work. Several HR professionals from the internet sector told Interface News that they rarely use 58.com for recruitment. One HR professional mentioned they only use 58.com for on-ground promotional jobs.
The 58 Group's struggles with profitability are no secret. Signs of operational pressure and growth fatigue were evident even before the company's delisting. Their disclosed financial report for Q1 2020 showed a decline in total revenue, paying enterprise users, and a net loss of 5.58 million yuan.
In an effort to reverse the decline, the firm made several internal adjustments. On July 17, CEO Yao Jinbo sent an internal memo stating that profitability at the city level was the minimum requirement for all businesses. He warned that any business line not achieving profitability within the year would be completely shut down.
Yao Jinbo believes that if their transactional and industrial businesses succeed, it would benefit their primary services, enhancing aspects like reputation, information quality, scenarios, and closed-loop systems.
However, the development trajectories of other business lines within the firm are not optimistic. For instance, their express delivery service, Fast Dog Taxi, went public in Hong Kong in June 2022. By the end of 2021, Fast Dog Taxi held a market share of 3.2%, while competitors Huolala and Didi Freight had 52.8% and 5.5%, respectively. In 2022, Fast Dog Taxi reported revenues of 773 million yuan, a 17.01% growth from the previous year, but both gross and net profit margins decreased.
Other brands under the group, such as the domestic service platform Swan at Home and the real estate platform Anjuke, are also in challenging positions within their respective industries. Based on previously submitted IPO documentation, Anjuke's 2020 revenue was roughly 11.4% of competitor Beike's revenue for the same year. Despite Swan at Home claiming to be China's largest integrated home service platform, their total transaction volume in 2020 was less than 1% of the market.
Having transitioned from China's largest classified information website to a private company, 58.com is undergoing an essential transformation. Amidst mounting scrutiny of its main business operations, rebuilding brand reputation and steering other business lines toward profitability are pressing challenges for the 58 Group.
