There are many types of agencies which you can start, you have to decide depending upon your contacts and knowledge. The process and tools more or less remain the same.
Recruitment Agency is basically the middlemen between job seekers and employers. The employers provide what kind of talent they are looking to hire and then recruitment agencies start providing that talent to employers. Upon every successful placement, the agency gets paid. Of course, this might vary from one business model to another but in simple words, that's how it works.
Step 1: Decide your niche
This depends upon your contacts, what kind of candidates you can provide to your clients. Ask these questions to yourself.
Are they fresh graduates or executives?
Next, what kind of industry are you willing to serve? (Medical, IT, Automobile)
Step 2: Your competition and market condition
You don't want to start when most of the companies are looking to layoff their employees. In this type of market, you will get a lot of candidates but you will have less position to fill.
Competition matters. If you have read Zero to One book by Peter Thiel (The co-founder of Paypal) you would recall avoiding competition since it is harmful to your business. Make sure to check competition after selecting your niche. Avoid competitive niches.
Step 3: Keep a strategy handy
There are many blogs on the internet and many groups on Facebook, LinkedIn which you can join and start learning about recruiting. Create your own strategy and test it, tweak it till you make it.
Step 4: Keep an eye on the budget
If you are starting on your own you will need a couple of things like an applicant tracking system, a couple of logins of sites like Indeed, Linkedin to source candidates, marketing cost. Make sure you calculate these cost at the earliest.
Step 5: Research Laws
There are laws like EEO, GDPR which you have to adhere to. Make sure you are aware of all the laws which might cause a problem down the line if not taken care of.
Step 6: Go local before you go global
Choose a locality and focus your marketing efforts in that area only. This will keep your marketing cost low and visibility high. You can think about expanding once you are all set.
Step 7: Create a list of Clients - the most important step
Make a list of potential clients. These may be your own personal contacts, a list of companies in a particular industry or a general list you have obtained from an Internet search.
Step 8: Approach Clients and Fill Positions
You need to dial for dollars since you are starting you should consider first studying your clients, their business and then approach. Once you get the vacancies, fire up your ATS and start filling positions.
Please feel free to share your views, opinions or any other content that adds value to this.
Hope this helps :)