On the eve of yesterday's IPO, things were looking shaky for HireRight (NASDAQ:HIRE). With a price range of $15-$17, the company was only able to fetch $15. The stock quickly lost ground and fell as much as 9.6%. But a rally ensued, and by the end of trading, the stock was only down about 1.80%.

HireRight develops Web-based software that allows companies to screen employees. There are database searches for criminal records, license verifications, credit checks, and so on.

From 2003 to 2006, HireRight's customer base expanded from 800 to more than 1,400. It has 17 customers on the Fortune 100 and 53 on the Fortune 500.

An aggressive alliance strategy has been key to the growth. Some of the partners include Taleo (NASDAQ:TLEO), Oracle (NASDAQ:ORCL), IBM (NYSE:IBM), and Accenture (NYSE:ACN). They typically integrate HireRight's services into their software applications.

The upshot is that HireRight has been on a strong growth ramp. From 2003 to 2006, revenue more than doubled to $58.1 million. It was also impressive that operating income swung from $190,000 to $6.3 million over the past year.

True, there are more than 1,000 screening firms. But HireRight claims that most of its rivals are fairly small operators and lack its sophisticated technology platform.

Despite all this, I'm still concerned. For example, this week the Federal Reserve indicated that there is a high probability of a slowdown because of tighter credit and an ailing housing sector. In other words, if the job market softens, there will probably be fewer employee screens.

Another drag could be the spike in going-private transactions in the first half of this year, which have involved megacompanies like Chrysler, First Data Corp. (NYSE:FDC), and TXU (NYSE:TXU). It's a good bet that these companies will lay off workers so as to pay down debt loads.

There's no doubt that HireRight has a strong technology and customer base. But in the short run, things may not be so rosy, and it's probably best for Foolish investors to hold off on the stock for now.

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Fool contributor Tom Taulli, author of The Complete M&A Handbook, does not own shares mentioned in this article. He is currently ranked 4,156 out of more than 60,000 players in Motley Fool CAPS. The Fool's disclosure policy will never show up to a job interview barefoot again. How was it to know Bear Stearns would be so uptight?