Building Talented Teams: Selecting the Ideal External Recruiter
Building out your company’s team will at some point require the support of external recruiters. Understanding
when to call them in can be a challenge for even the most seasoned entrepreneur, so how do you navigate your
way through the maze and avoid expensive shots in the dark?
Through our conversations with recruiters, HR consultants, and heads of talent, we’ve distilled the ideal approach to building talented teams, internally and externally. In Part 1, we outlined the ideal approach to using your internal team to conduct your recruiting. Here in Part 2, we’ll provide insights to determine when your company should engage with an external recruiter and how you should identify the recruiter that will work best for you.
What is the value of an external recruiter?
External recruiters can be immensely valuable to the recruiting process of many high-growth companies…if deployed strategically for the right purpose. A good recruiter brings with her a rich, sector or stage-specific network of candidates. She can provide an invaluable macro perspective of a company’s industry and updates on the changes in personnel, pay scales, and competition over time that a founder or recruiting team might not know.
The right recruiter also brings additional capacity and know-how on recruiting best practices that can complement and even amplify the efforts of a company’s internal recruiting team.
To be clear, relying on internal capacity to conduct the process of hiring new members should be the default choice of any company, as it provides the best opportunity to align your recruiting with your strategic plan. However, there are exceptions to the rule, and it is essential that a company identifies when those arise so as not to burn time and expense on a flawed or futile search.
When should you use an external recruiter?
Depending on the nature of the position you’re advertising or your internal team, there are a number of timing considerations to take into account:
1. When looking to fill positions of a special quality:
For example, recruiting for roles that are very senior (director level or above), technical, difficult to define, or confidential might prove difficult to handle for your internal team. In these cases, you should look outside of your internal team in recruiting for these roles.
2. When your internal recruiting team has reached its maximum capacity:
The maximum capacity of a dedicated internal recruiter is 10–15 active jobs. The capacity of a team member split between recruiting and other responsibilities is much less, so supplemental support should be strongly considered if your internal capacity is stretched thin.
3. When looking for roles that have proven traditionally hard to fill for your organization:
This assessment is highly dependent on the company knowing its industry, geography and supply of viable candidates. (These do not have to be senior roles — some positions, such as executive assistant, might unexpectedly fall in this category.) Whether a role is hard to fill can oftentimes only be determined by trying — and failing — to source candidates through your internal team. Give your team at least two weeks to search for candidates for any role, after which you should assess whether using an external recruiter
will be necessary if you have found little success.
How can you find the right external recruiter that works for you?
1. Choose the recruiter best connected to the type of person you want to recruit:
For targeted searches, rely on specialist, region-specific, or industry-specific recruiters. They tend to be most effective, as they understand the market and the role for which you are sourcing. Generalist recruiters are best at sourcing generalist candidates, so be thoughtful in deciding what situations would be best for engaging with them as opposed to specialist recruiters.
2. Follow the lead of your ideal candidate:
As Will Champagne of Ivy Scale says, “always ask: who has the relationships with people you would like to hire?” Your ideal target would pick up the phone when certain recruiters they trust call them, so make sure to inquire about a recruiter’s existing network before determining if she is best equipped to recruit your ideal target. Ask employees of yours in similar positions, or reach out to people in similar positions outside of your company to determine what recruiters have their ear and understand the market well.
3. Choose a recruiter based on the form of engagement that works for you:
Retainer: This involves a fixed fee, time-constrained relationship, wherein the company pays the search firm over three periods of time: a) at the start of the engagement, b) after a few candidates have been interviewed, and c) once a candidate signs an offer letter. These are best for senior or executive positions, when you want the best candidate possible and there is no sparing expense or, in some cases, time.
Container: A hybrid between a retainer and a contingency, this involves two payment installments: a) a deposit to initiate the search and, b) a payment once a candidate signs an offer letter. This relationship is best with critical
mid to senior-level hires to be completed urgently (in 6–8 weeks).
Contingency: Only one payment is made to the search firm, on the date the candidate sourced by the firm begins her role. These are better suited for sourcing junior roles.
#Protip: The best recruiters in the industry tend to gravitate towards working at retainer firms, for reasons related to compensation and prestige. Therefore, the type of firm you choose might affect the quality of outcomes of your search, depending on how particular you might be.
4. Determine if location is essential to the role for which you are hiring:
Some roles, and the likelihood of finding ideal candidates, can be significantly affected by a recruiter’s local knowledge. Clearly determine if roles you are recruiting for—and your ideal candidates—are location-specific before searching for recruiters with a regional focus.
“Tech recruiters should be based where the tech talent you want is; sales recruiters can be based anywhere, as long as they are good at finding good candidates.” — Shelly Duong, Mochi HR Consulting
Critically examine a national recruiter’s scope. Some “national” recruiters outsource searches outside of their home region to local vendors in other regions. Determine whether the recruiter you’re paying is actually taking
the lead on the search in a particular location or passing it off to an outsourced vendor.
5. Consider other important factors:
Look for recruiters that are committed to deeply understanding your company, team, and the role defined, and with whom you can develop a long-term relationship. They are the ones that will be the best proselytizers of your company’s values, culture, product, and selling points to the best candidates in the market. In many cases, recruiting firms that you have worked with in the past will fit the bill, but this may not always be the case.
To find the best recruiters, don’t just rely on the reviews! Lean on your investors, or seek references on recruiting firms from your employees, partners, investors, and other companies. Sometimes even competitors are willing to share such information! Don’t rely on recommendations of recruiting firms alone. Seek out and develop relationships with individual recruiters, as their expertise, quality, and fit with your company might vary widely even within the same firm.
A great company does not build a successful team one way: optimizing the use of internal and external hiring resources is essential for any company looking to find the right employees and do so cost-efficiently. Following the general principles in Part 1 and Part 2 can serve as a simple guide: prioritize the use of
your internal team in hiring and recognize the limits on their capacity and competency with the respect to each role you’re seeking to fill. If you decide to engage with an external recruiter, be strategic in determining who you select, what the nature of your relationship will be, and what your determinants of success will be. And ultimately, always remain flexible: your search may not pan out exactly as you imagined, so be prepared to evaluate your plans at regular intervals and adjust as necessary.
