How to Start a Headhunter Business

Part 1 - How to start a Headhunter business - Background

A headhunter is someone who matches people with specific skills to different job positions. Headhunters typically work with people in their area, though they may work with long-distance clients as well.

Our guide is in 3 parts:

• Part 1 - How to start a Headhunter business - Background
• Part 2 - Our planner tool to see if this idea is the right fit for you
• Part 3 - Action plan to get started

What are the costs involved in opening a headhunter business?

Headhunters can get started with very few resources since most clients don’t expect a formal office space. They may only need business cards and a professional website to get up and running.

What are the ongoing expenses for a headhunter business?

Headhunters typically won’t have too many expenses besides basic marketing costs, unless they choose to operate from a standard office. In that case, they’ll need to maintain their lease/mortgage and commercial insurance if they have employees or see clients in their location.

Who is the target market?

The target market is usually people looking for lucrative and fulfilling careers. Headhunters can technically work in any industry, but they tend to be more popular in well-paying industries such as finance, tech, or engineering.

How does a headhunter business make money?

The payment structure for a headhunter is not always straightforward. They may be paid by the employee or the employer, depending on which party the headhunter primarily serves. Payment is often related to the salary the employee will make.

How much can you charge customers?

Whether being paid by the employee or employer, most headhunters are paid a percentage of the first-year salary for the employee. Unlike recruiters, who typically receive 15 – 20%, a headhunter can make up to 30% of the salary.

How much profit can a headhunter business make?

Headhunters can make quite a bit of profit relative to their business costs. It only takes one client to be placed in a $100,000-a-year job to earn $33,000 for the headhunter.

How can you make your business more profitable?

Successful headhunters may want to also do recruiting work on the side. While a different business model, it utilizes many of the same skills. Plus, it gives headhunters the opportunity to branch out and learn more about the many kinds of companies who rely on help to find the right candidates.

Day-to-Day and Growth

What happens during a typical day at a headhunter business?

Most days will find headhunters interacting with their many clients. They may be coordinating meetings between potential employees and employers, or updating potential employees on their status in the job process. Headhunters field questions, research information, and facilitate connections. They reach out to countless people trying to find those who are both qualified and interested in making a job switch.

What are some skills and experiences that will help you build a successful headhunter business?

Headhunters may not need to have an advanced degree in the industry in which they practice, but they should have some advanced knowledge to understand where and how to place people. Many people have likened headhunting to matchmaking because there’s a lot more to it than just working with people who are ‘good on paper’. Headhunters also need good people skills in order to understand and work with personality types of all kinds.

What is the growth potential for a headhunter business?

Job hunting has become extremely complicated today, with an overwhelming number of job listings across many online platforms. Even for the most qualified applicants, finding a position that matches both their skills and personal interests can be extremely difficult. Headhunters who have a good grip on the job market stand to go far in this business.

What are some insider tips for jump starting a headhunter business?

Headhunters may want to begin with their family and friends to get a feel for the business before serving clients. For example, if your cousin hates their job as a stockbroker, you can take it upon yourself to help them find something more appropriate. You may find them a different company to work for, or suggest an adjacent career that still makes use of their experience and education. Many people are averse to leaving the comfort of their job — even if they hate it. A headhunter has to be willing to push their clients to take risks without coming across as overbearing.

You’ll also need to decide if you’d rather cater to companies or to employees. An employee will come to you looking for a job change, while a company will come to you looking to fill an open position with the best possible candidate. In both cases, you’ll need to be willing to weed through dozens of potential options before pairing two serious parties who can mutually benefit from each other.

It takes a very specific set of skills and patience to spot the person who truly ‘fits’ in a company, so headhunters need to understand the value of persistence. Finding qualified employees who will stick with their employers is not easy to do — especially in an age where company loyalty pales in comparison to the bottom line. A headhunter needs to tap into the frustration experienced on both sides of employment so they can sell their services to the people who need it the most.

Finally, headhunters need to be in-depth experts in what they do. They need to answer detailed questions about both employees and the companies where they hope to work. Ultimately, headhunters should strive to be professional and honest in their careers. Many people will invent stories to reach employees due to the sensitive nature of helping employed people find work. While this can be an effective strategy at the beginning of your career, it may backfire more often than not. A better strategy is being diligent and discreet while remaining honest.

How and when to build a team

Most headhunters will work on their own, though some will hire associates to research positions and track down employees who match a specific set of criteria. An extra employee can make it easier to do the more labor-intensive work of handling the employees and employers.

Part 2 - Is a Headhunter business the right fit for you?

Part 3 - Action plan to launch your Headhunter business in 90 days