Is it possible to start a recruiting business without prior experience?

I know many people will think I'm nuts, but I'm a self employed mortgage broker that has gone from making great money to virtually nothing. I believe many of the sales/customer service skill that I have would help make successful in the recruiting business.
I know the traditional route is to go work for a large company and then go out on your own after achieving some success. However I have investigated that avenue and cannot at this stage of my life go back to an environment where the company will hire anyone with potential and see how it goes. (All the while the company makes a hefty portion of the fees as long as one of their recruiters places the candidate.)
Any constructive thoughts would be very much appreciated.

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Yes. I was only in the industry for 5 months total though. The short tenure is not because things were getting difficult for me, but the opposite. Feel free to send me a message if want to discuss things in more detail.


Sidney Silver said:
Alon, That is certainly encouraging news. As noted, the companies that I have interviewed with thought that those were extraordinary results. Prior to hearing this information, I had thought that you could be generating commissions relatively quickly with the proper mentoring, training and dedication.

Just out of curiosity, did you have the same success in the next several months?

Again, kudos!

Sid

Alon said:
I completely understand where you are coming from. Its hard going back to certain structures once you have tasted a real commission check in the past. I get it.

I'm also in the process of trying to figure out if I should do this on my own. I got out of the biz last month after being in it for 5 months. You can't really put a price on the experience you gain. There are so many little beneficial details that I would have never picked up without observing my colleagues.

I guess I was one of the few ( according to Sidney) who were able to do 3 deals within my first 90 days. I did my first deal my 2nd month and did two deals my 3rd. This was in the current economy, just a couple months ago. I'm as confidant as the next guy, but realistically I don't think I could have done it without guidance.

I know its not much advice, but I hope it helps. Feel free to send me a message if you have any questions.
Sidney,

Just my opinion, but I think if it takes 3 to 6 months to make your first placement, then this job is not for you. :) Depending on the level you recruit for, I would expect someone to make their first placement realistically within the first 2 months, 3 would be the absolute max. There's just no reason for it to take longer than that if you are working hard and smart. I started in a bad economy, and still made my first placement 3 weeks in, and several more the next month. It can be done. I also worked in an agency where we sat down with our manager each month and tracked our numbers. I remember being horrified about 5 months in when I had a zero month, no placements. My manager looked at my numbers though and they were good, lots of activity pending and he just said, 'the numbers don't lie. Keep this up next month and then see where you are." Sure enough the next month I think I had 4 or 5 placements! Stuff from the prior month had carried over.

~Pam

Sidney Silver said:
This is a very interesting topic that I have taken to heart. I, too, am considering becoming a recruiter. I have interviewed with several companies and I have heard the same story: it will take 3 to 6 months to make your first placement. Although, one of the companies that I am interviewing with explained that they have a new recruiter that made 2 and almost 3 placements in the first 90 days; but they thought this was rather extraordinary.

I have read that everyone is really feeling the pinch securing orders. With this in mind, what is a reasonable time frame to start seeing some placements, in light of the current economy of course.

Thanks.
When it comes to placement rates I think it's helpful to know what kind of job orders you are working on. Are you placing admins? Sr. Managers?
Slouch said:
Regarding- "However I have investigated that avenue and cannot at this stage of my life go back to an environment where the company will hire anyone with potential and see how it goes. (All the while the company makes a hefty portion of the fees as long as one of their recruiters places the candidate.)"

my question is why not?

this reminds me of the recruiting tip I left here

It takes years to really be good at this. You can and probably will make money before the "years" pass but to be very good at this, it takes time. There is nothing wrong with giving half your production away as long as you are learning and your placements are on the rise.

There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this. I don't advise being creative in the beginning of one's recruiting career. Go work for someone who is successful and will teach you how to do this right.

"There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this."
Hi All,

I am very interested in discussing this topic. I have created a group here on RBC named "Starting Your Own Business". Please join! http://www.recruitingblogs.com/group/startingyourownbusiness
Slouch said:
Regarding- "However I have investigated that avenue and cannot at this stage of my life go back to an environment where the company will hire anyone with potential and see how it goes. (All the while the company makes a hefty portion of the fees as long as one of their recruiters places the candidate.)"

my question is why not?

this reminds me of the recruiting tip I left here

It takes years to really be good at this. You can and probably will make money before the "years" pass but to be very good at this, it takes time. There is nothing wrong with giving half your production away as long as you are learning and your placements are on the rise.

There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this. I don't advise being creative in the beginning of one's recruiting career. Go work for someone who is successful and will teach you how to do this right.

"There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this."

It has been my experience over the past two years or so that more and more recruiting firms (up to probably 10 people) are not only willing but wanting to do more split work. And what is wrong with that? Recruiting budgets are contracting, there are more and more preferred vendor lists, access to information is easier than ever making speed a priority, let the average recruiter only places a very small percentage of candidates they source thus reducing the true margins of a placement significantly. And the fact is, the better a recruiter you are the more you are going to leave on the table. Why not expand your resources and monetize those assets?

I take offense to the notion that the only recruiters who do splits are those who can't function in a normal recruiting environment. What is a normal recruiting environment (and I've worked in large offices)? Is it normal to source an excellent candidate that because of limited resources is placed through another firm? Is it normal to have a great job order and while you’re sourcing another firm completes the search?

Since I made the full commitment to cooperate with other recruiters and firms my revenue and customer satisfaction have gone up significantly. I have found that combining resources moves more inventory and makes clients and candidates happier with more options and faster placements.
Hi Christopher,

let me explain. The original post by Jerry says he does not want to go work for a company and give away a good chunk of his production.

It is this distaste for sharing commission that drives a lot of the marketing from companies like dayak for instance where I have heard they make a case for a recruiter working an 8% fee.

I am not against in any way doing split business. In fact, when I ran my recruiting firm, we did hundreds of thousands of dollars in split business so again, I am not against it. What I am against is people going and becoming recruiters and thinking that the way you make placements is by utilizing split systems and whacked out creative financially driven models.

My feeling is that if you want to become a recruiter, you need to be trained by someone who knows how to make a placement from start to finish. This means coming in with nothing to sell and no one to sell it to and by the "end of the day" ending up with a fee. I really believe that if you start your day recruiting for half a fee ( meaning another firm's order ), you will never know why being a recruiter is so good and the fundamentals of this business will never be clear.

When you talk to a client and they say I have 30 positions I need you to fill, you should only be interested in the 3 positions that are causing that company the most headaches because they are not filled. If you get excited that you can now pump 27 other positions through some third party system, you are wasting time.

I hope that makes sense. I read it over twice.

Christopher Poreda said:
Slouch said:
Regarding- "However I have investigated that avenue and cannot at this stage of my life go back to an environment where the company will hire anyone with potential and see how it goes. (All the while the company makes a hefty portion of the fees as long as one of their recruiters places the candidate.)"

my question is why not?

this reminds me of the recruiting tip I left here

It takes years to really be good at this. You can and probably will make money before the "years" pass but to be very good at this, it takes time. There is nothing wrong with giving half your production away as long as you are learning and your placements are on the rise.

There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this. I don't advise being creative in the beginning of one's recruiting career. Go work for someone who is successful and will teach you how to do this right.

"There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this."
With all due respect, I couldn’t disagree more. It has been my experience over the past two years or so that more and more recruiting firms (up to probably 10 people) are not only willing but wanting to do more split work. And what is wrong with that? The average recruiter only places a very small percentage of candidates they source thus reducing the true margins of a placement significantly. And the fact is, the better a recruiter you are the more you are going to leave on the table. You can’t place everyone on your own. Why not expand your resources and monetize those assets?

I take offense to the notion that the only recruiters who do splits are those who can't function in a normal recruiting environment. What is a normal recruiting environment (and I've worked in large offices)? Is it normal to source an excellent candidate that because of limited resources is placed through another firm? Is it normal to have a great job order and while you’re sourcing another firm completes the search?

Since I made the full commitment to cooperate with other recruiters and firms by revenues and customer satisfaction have gone up significantly. I have found that combining resources moves more inventory and makes clients and candidates happier with more options and faster placements.
Slouch said:
Hi Christopher,

let me explain. The original post by Jerry says he does not want to go work for a company and give away a good chunk of his production.

It is this distaste for sharing commission that drives a lot of the marketing from companies like dayak for instance where I have heard they make a case for a recruiter working an 8% fee.

I am not against in any way doing split business. In fact, when I ran my recruiting firm, we did hundreds of thousands of dollars in split business so again, I am not against it. What I am against is people going and becoming recruiters and thinking that the way you make placements is by utilizing split systems and whacked out creative financially driven models.

My feeling is that if you want to become a recruiter, you need to be trained by someone who knows how to make a placement from start to finish. This means coming in with nothing to sell and no one to sell it to and by the "end of the day" ending up with a fee. I really believe that if you start your day recruiting for half a fee, you will never know why being a recruiter is so good and the fundamentals of this business will never be clear.

When you talk to a client and they say I have 30 positions I need you to fill, you should only be interested in the 3 positions that are causing that company the most headaches because they are not filled. If you get excited that you can now pump 27 other positions through some third party system, you are wasting time.

I hope that makes sense. I read it over twice.

Christopher Poreda said:
Slouch said:
Regarding- "However I have investigated that avenue and cannot at this stage of my life go back to an environment where the company will hire anyone with potential and see how it goes. (All the while the company makes a hefty portion of the fees as long as one of their recruiters places the candidate.)"

my question is why not?

this reminds me of the recruiting tip I left here

It takes years to really be good at this. You can and probably will make money before the "years" pass but to be very good at this, it takes time. There is nothing wrong with giving half your production away as long as you are learning and your placements are on the rise.

There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this. I don't advise being creative in the beginning of one's recruiting career. Go work for someone who is successful and will teach you how to do this right.

"There are many companies now that are building their business models on motivating recruiters not to give away the chunk of placement fees by way of creative split models and things like that but really, it's those recruiters who can't function in a normal recruiting environment that latch on to this."
With all due respect, I couldn’t disagree more. It has been my experience over the past two years or so that more and more recruiting firms (up to probably 10 people) are not only willing but wanting to do more split work. And what is wrong with that? The average recruiter only places a very small percentage of candidates they source thus reducing the true margins of a placement significantly. And the fact is, the better a recruiter you are the more you are going to leave on the table. You can’t place everyone on your own. Why not expand your resources and monetize those assets?

I take offense to the notion that the only recruiters who do splits are those who can't function in a normal recruiting environment. What is a normal recruiting environment (and I've worked in large offices)? Is it normal to source an excellent candidate that because of limited resources is placed through another firm? Is it normal to have a great job order and while you’re sourcing another firm completes the search?

Since I made the full commitment to cooperate with other recruiters and firms by revenues and customer satisfaction have gone up significantly. I have found that combining resources moves more inventory and makes clients and candidates happier with more options and faster placements.

I must have misunderstood. I do agree with your assessment on how to come up through the ranks and learn the trade!
No problem. It would have made for some good conversation if you did disagree. Have a good one.
Slouch said:
No problem. It would have made for some good conversation if you did disagree. Have a good one.

Yea...but that would have to happen over a couple of drinks...it should be an interesting year.

Best -
Anything is possible; however, I would encourage you not to underestimate the many intricacies in the life cycle of a placement. Your deals can and will blow up at any one of the many of stages. One of the great trainers in the industry, Anthony Byrne, cataloged 30 steps to the contingency placement process. You need to be able to not only understand but anticipate what might, should and needs to happen in that process. More importantly, you need to have the ability to influence both sides of the transaction to a successful outcome. That takes training, experience and skill.

That being said, the best place to learn is on the job, working for another firm. You have to get past the fact that you won't be able to keep all of the fee. Don't let ego get in the way. With all due respect, your parenthetical comment confirms to me that you are oversimplifying things. I can tell you, without a doubt, it is likely you will earn more as part of a team. That's just a fact.

From the looks of the other responses to your post, you might want to rethink your strategy. You may very well have all the essential attributes, i.e. sales skills, comm skills, etc., but that alone will not ensure your success. Chances are with the proper training and experience, you'll do just fine. Shortcuts just don't work.

Best of luck to you.

- Frank
Talk about going from the frying pan into the fire, going from being a Mortgage Broker to a Recruiter.
Long term staffing offers a lot ( and I mean A LOT) of potential especially with the baby boomers first round of retirees that hit last year that were eligible to collect benefits for the first time but the next 6 months (very short term) looks fairly bleak especially for someone that a) has no contacts b) no experience.

But then again if you can get a gig that offers a minimum of a base salary and a decent bonus structure and you have the financial backing to hold out for 6 months to 1 year. Then go for it. It could be the best learning experience of your life.

Being in business for over 14 yrs we've seen our share of slow downs and I would certainly caution anyone against making a move at this time however I will say that coming out on the other side of a recession/downturn and knowing you made will be a HUGE achievement and confidence builder. Plus when the economy does start to turn around you will be one of the only few left among a much smaller handful that made it through the toughest of times. Competition will be much less and opportunities will will start plopping in your lap.

Think of it as having to slog through a miserable mosquito and gator infested swamp filled with snakes and the whole thing but on the other side of the swamp is a gorgeous beach with bleach white sand, swaying palm trees and turqoise oceans. I actually have a beach as my screen background to give me that perspective.
Ya can't go over the swamp, ya can't go under it you gotta go through it.


Jeff Weidner
HTC Research Corp
925 313 9005 X 200
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