Contingency Recruiting Doesn't Work Well for Early-Stage Startups

Contingency recruiting is not very effective for early-stage hiring. Since contingency recruiters get paid only if they are able to fill a job opening and charge 20-25% of the new hire’s first year salary, they tend to share candidate profiles with larger companies that pay higher salaries which make them more money.

Early-stage startups tend to get candidate profiles that the larger companies passed on. This results is less desirable candidates and a lower volume than if a startup were to do recruiting in-house.