Massive Growth or Profitable - Those Are the Options
January 22, 2026
The new World of AI has changed investor expectations for startups and that is making survival more and more binary.
Today, we’re talking about recruitment consultants and if you should use them?
For your 1st 10 employees? Absolutely not. The first 10 employees at a startup are the foundation of the company’s future. You need true believers. Unfortunately, the way recruitment consultants are paid, creates a bad incentive structure — for example 25% of the year 1 salary if the employee stays for 12 months. So the recruiters want the highest salary for a candidate — not long term equity and after the refund period is over, they can make a lot of money finding that employee another role.
Now, a lot of later stage executive hiring, Series A and beyond, will involve recruitment consultants. Personally, I still don’t like it. Yes the candidates are more senior but the bad incentive structure remains in place.
As an alternative, I have seen success with the hiring marketplaces, like Hired.com, Angelist A list and similar — they still charge contingency fees but as a marketplace, there’s less risk of individual recruiter behavior hurting your company.
