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The Failure of Passive Recruiting: Recruiters

  Tutorspree        2011-10-26 06:59:33       1,645        0    

This is an actual conversation I had with a recruiter:

Phone rings and I pick it up

Him: Hi, is Paul there?
Aaron: May I ask who is calling?
Him: I have a technical question. 
Aaron: Ok, what is it?
Him: Are you technical?
Aaron: Yes. Who is this?
Him: Who are you?
Aaron: Are you a recruiter?
Him: Yes and…
Aaron: Great, send us your resumes, if we like what you send over, we’ll let you know if we want to meet with the candidates, other than that, have a good day.

That’s the first of several times the same recruiter, or someone from his office called with the same lame attempt to…build a relationship?

There are a lot of recruiters who have realized that technology (broadly construed) is hot right now. They’ve further realized that there are a relatively large number of companies looking to spend raised capital on a technical talent pool that is too small to meet demand. In the minds of most recruiters, that means that all they need to do is throw engineers at companies in the hopes that one or two will stick and they’ll get their commission.

The truth is that that model does work in certain situations. Recruiting shops exist for a logical reason - companies often need to fill roles and can’t figure out how to do it. Enter recruiter who understands the role well, where to find candidates, and how to properly match them up. What the recruiters don’t understand, however is…anything about the way a startup works, what it needs, and how to procure those people.

The roles that we fill at this stage are highly specialized and generally call for nearly contradictory attributes in candidates. You need incredible good engineers who are not already in golden handcuffs, are crazy enough to join a risky early stage company, do not want to found their own company right now, want to work at all hours, and are aligned with the culture you are trying to build.

In order to understand how all those pieces properly fit together, the recruiter would have to spend a material amount of time with your company - getting a proper feel for your culture, your working style, etc. Then, the recruiter would have to do a similar thing with the candidates - actually getting to know them as people rather than just resumes. More than that, the recruiter would have to find a way to become totally trusted by both sides in order to get the real answers and be able to make good matches.

Those requirements on the recruiter are significantly different than they are when working with larger companies who a) have more easily discernible cultures b) have higher tolerance for error in hiring and c) are simply more familiar.

Now take a look at the economics of recruiting (with a number of simplifying assumptions) - recruiters rely on the fact that they get a ~25% first year salary placement fee for each candidate. With early stage startups eschewing high salaries in favor of equity, that placement fee isn’t huge (relative to more established companies). If one out of every 100 candidates delivered is actually a good fit (generous assumption), then the recruiter would need to spend enough time with maybe 5x that number to send you the 100. If you figure that the recruiter needs a minimum of 3 hours to get a deep enough sense of the candidates “matchiness,” the system begins to look incredibly inefficient. And it is, especially relative to larger companies that will accept more candidates more rapidly.

Hypothetically, this sort of effort makes sense if the startup gets huge and if the recruiter can build a relationship that leads to a lot of hires down the road. Those are bad odds. More than that, it’s a bad way to spend time and money. As a result, the good recruiters focus on what they’re good at, on the accounts that come with retainers and huge success fees. Those relationships are with big companies, not startups. And so startups are left with firms throwing darts in the hope that a small amount of effort will lead to one or two hits.

What that means for a startup founder is that recruiters are, by and large, a waste of your time. Yes, there are a few good ones out there who will put in the effort and select good candidates, especially if you are as strict with them as Paulie (more on that later). However, your interests are, for the most part, fundamentally misaligned with theirs. Which means, end of the day, that recruiters, despite what they might say, are not a source of hires. You cannot let someone else passively search for your employees.

Source:http://blog.tutorspree.com/post/11909570564/recruiters-and-startups

RECRUITMENT  HR  FAILURE  RECRUITER  HIRE 

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