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5 minute read / Jan 25, 2013 /

A Startup’s Step-by-Step Guide to Working with Recruiters

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“It’s something I thought I’d never do,” one founder told me yesterday. He had hired a recruiter to help him grow his team. But at some point in time, most quickly growing startups will need help forming their teams.

We kicked off searches at two Redpoint companies in earlier this year in addition to several last year and I’ve been taking notes on each of the processes. One of my partners, Tim Haley, was a top recruiter in the valley for many years and having his experience and expertise has been invaluable. These are my notes:

When to Hire a Search Firm

  1. When the time vs money calculus changes. Recruiting is expensive and fees can range from $10k to $100k+ depending on the role and the firm. Firms either charge on a contingency basis (success fee) or on a retainer (fixed fee per month). Seed stage companies typically can’t afford these services and so they allocate their time (instead of their dollars) to build pipelines. Having grown their balance sheets, Series A companies often employ retained recruiters for key positions (VPE, VPM, VPS) and then hire contingency recruiters for building the eng team. In all cases, it’s important to keep an eye on the costs.
  2. When the networks of the team and board cannot produce the right candidate pipeline. Most high level hiring processes begin with the CEO and the board rifling through LinkedIn or their CRMs to find relevant candidates. When that pipeline dries up, a recruiter can be an effective solution.

How to Pick a Search Firm

  1. Choose a firm like you hire an employee. The recruiter is a paid representative of your company. They should be excited about the opportunity for the business, capable of selling the vision of the business and most importantly exude a personality that is culturally consistent with your startup.
  2. Reference the firm. Recruiters should be diligent about building a pipeline, communicating the state of that pipeline and working seamlessly with the CEO/founder to advance candidates through the pipeline efficiently. The only way to verify their working style is by calling previous clients.
  3. Screen for ethics. Ethics is the sine qua non of the recruiting world. Poaching employees from previous clients is verboten.
  4. Match the role and the expertise of the firm. Every firm and each person within that firm will have an expertise. Ask about the expertise, request sample candidate resumes and compare across firms to ensure the best fit.

In-house or out-of-house

Typically, more junior searches are completed in-house with some firms deploying a recruiter to work within the startup to understand the company better, reduce communication latency, and also present a unified experience to candidates. This is common for engineering recruiting.

For more senior searches, out-of-house recruiters are the norm. Even publicly traded companies do this.

How to Set Up the Process for Success

  1. Commitment to hiring. First, all the key stakeholders must be in agreement to that the company needs to fill a role. This includes the founders, the management team and the board. The person managing the process must also commit to prioritizing the search. Using recruiter as leverage to convince a team to hire results in a high failure rate and frustration all around.
  2. Establish consensus on the candidate profile. Before hiring a search firm, the startup should have a reasonably good idea of the responsibilities, background and role of the new hire(s). It’s critical that all the stakeholders reach consensus on this before the search. Don’t assume that everyone is in agreement, but write down the requisition and solicit comments to be certain. Share and discuss this requisition with the recruiter. Of course, this job requisition may evolve over time as the team learns through interviewing but most of the key requirements will remain.
  3. Write down and share the process. Every candidate should go through the same or very similar interview processes to establish a calibration among the hiring team. The key attributes of the role should be tested in interviews and verified with references.
  4. Use the start of the recruiting process to train the hiring team’s filter. Having the recruiter and most of the hiring team meet the first few candidates will ground conversations. Instead of speaking in hypotheticals about certain characteristics, the hiring team can point to strengths and weaknesses in individuals and calibrate the trade-offs.
  5. Hurry slowly. There’s a Latin expression, festina lente, meaning hurry slowly that describes succinctly the pace of these search processes. The Bay Area job market is a bustling. To win candidates, the hiring team must be responsive to candidates and aggressive with great prospects. But not rush!
  6. Leverage your assets. Ask the board of directors or advisors to help close candidates.

Setting Up the Process for Success

Like any team, a hiring team needs to communicate well, trust each other and agree to pursue the same goals. Hiring an external recruiter can accelerate the time to hiring a candidate dramatically. But it’s important to ensure that the search process is set up for success. I hope these notes will be helpful for you.

Related: How to Build a Hiring Pipeline

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