When Should Startups Hire a Full-time Recruiter?

Along with an accounting team, startups are often advised to forego hiring HR staff in the early days. Instead, they’re told to outsource HR tasks, including recruiting, benefits, payroll and more, so that they can instead focus their time and money on building their business. But when it comes to recruiting, founders typically take on the brunt of the work in the very early stages, spending 30-40% of their time reaching out to their personal networks for prime candidates and investing countless hours trying to find the right people for their budding team. However, this process becomes unsustainable as startups start to bring on more talent. Even if a company is utilizing recruiting software, like Greenhouse or Jazz (formerly Resumator), technology alone cannot handle the specialized hiring needs of a small company. So when should a startup expect to bring on a full-time recruiter? And who is the ideal recruiter for a startup?

Benchmarks for startup recruiting needs

  • Less than 15 employees: At this stage, founders manage recruiting themselves, networking largely within their own circles—including emailing friends, turning to social networks and attending networking events. Posting job ads on more startup-focused targeted job boards, like LinkedIn or AngelList is often fruitful for finding candidates, as is searching for passive candidates on LinkedIn. First hires often feel so critical, both in terms of performance and in establishing company culture, that founders often want to be involved in every step of the hiring process—a huge time investment.
  • 15-30 employees: This is the optimal size for a recruiter to join a startup. Once a company grows beyond 15 employees, and will likely hire 8-10 more in the next few months, it’s time for founders to consider handing over the reins to a dedicated HR professional. Once a startup reaches this size, it is not prudent for founders to be spending so much time sourcing, scheduling and interviewing candidates. Having dedicated personnel will help them achieve more leverage and scale in hiring, though founders should expect to continue to spend roughly 30% of their time recruiting. Benji Markoff, CEO of Founder Shield, currently finds himself in this position: “We're trying to hire a lot of people right now, so it just made sense to go for it and get someone on retention with a salary.”
  • 25-50 employees: At this point, startups are starting to hire more regularly. In addition, it’s the first 25 employees who define the startup’s culture—including tone, pace and mindset. Once you hit this benchmark, you have a strong sense of the types of candidates who would be a good fit, which should make the overall hiring process easier to standardize and scale. If you haven’t yet brought on in a full-time recruiter, now’s the time, and you can accelerate that process by investing in a recruiting software that will help you create formalized hiring procedures across your organization and manage the entire recruiting process. Says Peter Reinhardt, co-founder and CEO of Segment, “We've been using Greenhouse for a while now. We needed more structure around the interview process, and Greenhouse has that. We initially just needed a place to put leads, but eventually we started to need more and wanted to work toward a consistent, high-end recruiting process.” These are critical functions as your organization continues to grow.

Who is the ideal recruiter for a startup?            
If you’ve determined that your startup is ready to bring on a full-time recruiter, it’s important to find the right person for the job. Startup recruiters are a specialized bunch, and understand the needs of growing a business from scratch. See below for some important traits to look out for as you begin your search for an optimal recruiter.

  • An extension of you: Since he/she will likely be joining your company at an early stage, the recruiter’s job is to act as an extension of the founding team, furthering your goals and overall vision for the company. The person should be able to spread enthusiasm for the company to all new hires/recruits and be able to pitch your company (almost) as well as you can. He/she should be passionate about building the company and scaling the team, in the same way your product team is passionate about developing your product. He/she should understand every facet of your company so that they can continue to build that company and continue its current trajectory.
  • Experience starting from square one: Look for a recruiter who has built teams from scratch before, not one who has focused only on filling specific roles or departments. The recruiter should understand the types of candidates you need, and how different candidates will complement each other to form a cohesive unit.
  • Industry experience: Recruiters have different areas of specialization. And while you don’t need your recruiter to be a technical expert in your field, it is helpful to find one who’s familiar with your industry and product. They will be more apt to ask relevant questions to interviewees, and field questions as necessary in an informed manner.  
  • A relevant network: A recruiting candidate with pertinent industry experience will also have had exposure to the types of candidates you’d like to hire. One thing you don’t want is a recruiter who is simply trolling job boards to source candidates—you can find a software to do just that.

Thanks to advanced recruiting software that has recently popped up, startups have been able to delay hiring a full-time recruiter. While those tools, and lots of hands-on involvement from the founding team, do help smooth the process for early-stage startups, serious recruitment calls for the experience and know-how of a seasoned startup recruiter. The ideal candidate will understand the ins and outs of your business, is committed to growing your team and can establish formal hiring process across your company. This is value that goes beyond that which can be found in recruiting tools, and which becomes necessary after your company reaches a certain size. As a founder, you just don’t have the time to oversee every step of the process. The payoff will be higher-performing candidates and faster scaling of your company—money well spent!