
How To Disrupt Technical Recruiting - Hire an Agent - nikosmar
http://www.javacodegeeks.com/2012/09/how-to-disrupt-technical-recruiting.html
======
altay
We're doing this at 10x Management (<http://10xmanagement.com>).

Long story short, I was freelancing as a full-stack (Rails) dev, and also
playing in a couple bands. Through the music scene, I met some music managers
in NYC. They've been in the biz for 15-20 years (managed John Mayer, Martin
Sexton, Bruce Springsteen's tours, etc.). In talking, we realized what they do
for music clients would be really useful for me as a freelance programmer.

Basically, a manager's job is to take care of the business side, so the talent
can focus on what they're good at. So, in a strange experiment, I hired them
to act as my agent for programming gigs. They started taking care of all my
negotiation, invoicing, collection, scheduling, etc.

It worked out really well for both of us, so we partnered up and started 10x
Management, to do this for more people. Essentially, we're bringing the
concept of a talent agency to the tech world.

Unlike the OP, we focus only on freelance work (not full-time placement), but
so far the model is working very well for all parties. The talent is happy
(we've been described as a "virtualization layer" for freelancers), the
customers are happy (we represent the best), and we're happy (it's very
gratifying to help people with their long-term career and lifestyle goals).

We're growing fast, so if you're interested in representation, or you need a
badass freelancer (web/mobile dev, design, data science/viz, PM, etc.), or you
just want to learn more, get in touch via our website or hit me up at
altay@10xmanagement.com.

~~~
fecak
OP here, and that's great to hear. My idea would be to represent careers
regardless of the contract or perm hire scenario. Recruiters tend to handle a
lot of that stuff for independents anyway (depending on corporation status and
such). In past jobs I've had consultants work for me for a few years and we
managed them from gig to gig, similar to what you describe it seems. Good luck
to you.

------
southphillyman
FWIW, I found my first development job by attending one of this guy's JUG
meetings in the suburbs of Philly, and speaking to a CIO who was attending. My
understanding then was that Fecak was a recruiter and the JUG meetings were a
way for him to get face time with developers and build credibility in the
community. Can't really fault him for being opportunistic. At least he is
TRYING to make the experience less painful for devs. The recruiter industry is
in MAJOR need of a rehaul. I haven't posted a resume anywhere in over 3 years
and I still get 5-10 daily junk calls. There have been times when I avoided
departure from unfulfilling situations JUST because I dreaded the recruitment
process. Fecak's idea is innovative but I think there are a lot of questions
around how it would work. What's a reasonable fee? Will there be conflict of
interest issues if he is submitting multiple candidates? etc?

~~~
fecak
I guess I know you? Glad to hear you found work through the JUG. I obviously
am a recruiter and still lead that JUG, and it is a way to build credibility.
You could call it opportunistic, or you could say it is a way of giving back
to the community (if I were a true opportunist, I'd blast my open jobs to the
group, talk about them at every meeting, etc - and I don't do that). But I
could see how some might get that idea. It certainly hasn't hurt my business,
but at this point I don't need the extra edge of credibility that JUG
provides.

What is a reasonable fee? Good question! Perm placement fees range from 15-25%
of base salary, but I wouldn't expect any engineer to pay that much. The key
to think about is that even though an agent is getting some fee from the job
seeker, there is nothing to prevent him/her from taking a few bucks from the
hiring company as well - so in theory an agent could charge a low fee to the
job seeker and a reduced fee to the hiring company, which would seem like a
win?

Conflict of interest is something I also hadn't though about (glad a dialogue
is starting and I don't pretend to have all the answers). I would think that
in representing candidates (and not companies) there wouldn't be too many
conflict situations.

------
ig1
FYI. In most European countries (and presumably elsewhere) the agency model is
tightly regulated because the employee pays model (i.e retainer fees) is ripe
for exploitation of people desperate for jobs.

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ChuckMcM
Its an interesting concept. But to be viable you really need a 'job lifetime'
that is measured in months rather than years. If you work somewhere for 5
years what is the value add? And given that the typical ISO vesting period is
4 years ...

The stock model might be an interesting compromise. So represent me and I
grant you x% of my ISO on a per-annum basis. So lets say you agree to a 10%
take, and I go to startup X and get 100,000 share option. (vesting at 25,000
shares a year) so on my anniversary date I exercise and transfer to you 2,500
shares in the startup I'm working at. Could be hugely profitable, and a waste
of time, but the risk is shared. Can't eat shares though, so there has to be a
model for some cash.

What I like here though is exploring other models.

~~~
r00fus
Ok, but don't pre-IPO stock contracts usually prevent sales of stocks outside
the company?

~~~
fecak
True. Could be negotiated with company during the process perhaps. I know
recruiters who have been given stock in lieu of fee by firms.

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majormajor
The idea of an agent sounds fantastically attractive to me for the next time
I'm job hunting and looking to break in to a new area/field/whatever. It's
work, and it's not the sort I enjoy, so yeah, I'd be willing to pay for it.

Also, the idea of having an agent to negotiate salary, at least initially,
sounds great since the agent will presumably have a lot more knowledge of
other salaries in the area or even at that company and the information
situation would be more balanced.

~~~
fecak
I'm the author, look me up when you're ready to talk.

~~~
bartonfink
You should put your e-mail address in your profile on HN. The e-mail field
isn't publicly visible.

~~~
fecak
Done, thanks!

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mtrimpe
Having lived with someone who worked in fashion for a long time, I can't agree
more that the agency models work extremely well.

The agent would make sure finances are handled well, PR is constant and
appropriate, negotiations are taken care of and much more.

In general when I deal with recruiters I even tend to treat them as an agent:
I flat-out refuse to accept anything over 10% on top of my rate.

For a consultancy company my logic is the same: I find out what is being
charged for me, deduct my salary + costs from it and evaluate whether the
services that my company is providing me are worth the amount of money they
are earning on me.

At some stages in your career they are but often times they aren't. At those
times I would love to just get an agent I can trust, that I can work well with
and that will get me the jobs I want.

~~~
fecak
Author here. There are quite a few services an agent could provide, and you
mention a few. Handling incoming inquiries (forward LinkedIn requests from
recruiters to your agent), help maintain and build your brand (speaking
engagements, set up or recommend networking opportunities), negotiate raises
when you are working and salaries for new jobs, etc.

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electic
I hate to say it but the guy who wrote this article is nothing more than an
opportunist himself.

If someone ever came to me looking for a job who had an agent, I wouldn't even
bother. Just like I don't bother with 3rd party recruiters.

~~~
tatsuke95
I read this with the same mentality. What kind of bubble are we in where
programmers require agents along the lines of professional athletes and
Hollywood stars?

It makes a bit of sense in the context of the latter two; the contracts are
worth so much money that an agent can make a living off of a small percentage
of the take. But if you're a programmer who can't handle your own finances, PR
or salary negotiation, how well-rounded are you?

~~~
krickle
I don't love negotiating, I don't do it as a job so I'm not as good at it as I
am at developing. If this guy can get me an extra $X per year doing a job I'd
like anyway it's only sensible that paying up to $(X - 1) is a win, and that's
disregarding time saved.

~~~
fecak
Well put. I actually thought about proposing a model where a candidate gives
me a target salary, and agent bonus could be 1/2 difference between target and
actual salary (where salary is above target obviously).

~~~
krickle
That would be a neat experiment.

------
zacharycohn
We had this discussion in the IRC channel a few weeks ago. It's largely
unsustainable for the agents.

Agents work in Hollywood because if you're doing smaller work (commercials,
etc) you might get 3, 4, 5 jobs a month. If you're doing movies, you might
still do 2 or 3 or even 4 movies a year.

The average developer is at 1 job a year (or longer), or maybe 2 over the
course of a year.

Additionally, all the Possible Solutions to Problems identified in this post
are already being solved by GOOD recruiters. And many of the solutions
proposed that are "opt in" are what GOOD recruiters already do... the problem
with the industry isn't recruiters. It's BAD recruiters.

~~~
fecak
Author of the article here, and I agree that the problem is the bad
recruiters. My business is doing quite well, but I could see where job seekers
question the motives of recruiters mainly because of the fact that recruiters
get paid by companies, and only get paid (generally speaking) when they take
the job. So recruiters have the short-term incentive of convincing candidates
to take jobs, and not necessarily to do what is right for their career.

Long term requires recruiters to be fully ethical or lose credibility. If I
send you for an interview and it isn't the best fit for you, I'm financially
motivated to try and get you to take it anyway. As your agent, I would tell
you not to since you are my client.

The agent model would be advantageous to the tech community, but obviously
more costly to them. Whether or not it would be sustainable is something I
would be curious to find out. I'm not sure if an agent would only get paid
during a job search, as there could be advising going on during your entire
career that has some value (how to negotiate a raise for yourself, what is
hot/not, trends) - some of this engineers are good at, and some they are not.

~~~
zacharycohn
"Long term requires recruiters to be fully ethical or lose credibility. If I
send you for an interview and it isn't the best fit for you, I'm financially
motivated to try and get you to take it anyway. As your agent, I would tell
you not to since you are my client."

That doesn't make any sense. My agent is still financially motivated to get me
to take the job.

~~~
fecak
That depends on how you pay your agent. If you pay an agent an annual fee not
tied to a job change or activity, that agent would not be financially
motivated to have you move. I think the model works best with a long term
relationship with annual fees instead of just some tax when you change jobs.
There is quite a bit of guidance in between job changes that could be of great
value in getting to that next job.

------
tjtrapp
One of the biggest issues I see from the developers side is that "tech
recruiters" normally do not know much about technology.

The second issue is that most of the time I'm approached it feels like a
template where my name was has replaced {{name}}. For instance, take DHH for
example: <https://gist.github.com/1285068>

Now on to your question, would I pay for an agent. Sure, but they'd have to be
like Ari from Entourage. If I suck, tell me. If I don't, pay me.

Anyways, my $0.02.

~~~
fecak
Author here, I appreciate your $0.02. It's more important for tech recruiters
to know about what candidates are and are not qualified for than to know
actual code and such, but we've all heard stories about back-end and server
side folks getting submitted for UI design jobs. I think an agent would want
to be sure to know enough not to represent his clients to jobs that aren't a
fit, but also needs to know about trends and such that could be valuable
career advice going forward.

------
xoail
How about we put a 1-900 number on the resumes? That way if a recruiter wants
to get in touch, he/she has to pay a premium.

~~~
fecak
Author here. You think paying a buck or two will stop a recruiter that could
make 20K? Small investment if the resume looks strong!

~~~
xoail
I dont mind talking to a recruiter if he/she is paying me $10/min to talk to
me. In fact I can talk all day :)

------
TamDenholm
I'm a contractor and have to deal with recruiters constantly, i've been saying
for years it should be an agent style model and would even be willing to set
this up myself for the UK contracting market as i know a LOT of contract
developers and know how to find more.

The problem is, i've no idea how to go and find work for them, if i did, i
wouldnt use recruiters myself. I'm not comfortable cold calling companies and
i think thats a poor way to do things and most contract positions are only
advertised online by other recruiters.

If i knew any UK companies that were looking for a contractor, i could
absolutely place a highly qualified one in their company, but how do i find
those companies?

~~~
fecak
Author here. In your case, probably through the network of your former clients
and the networks of your candidate pool. It's tough to do without some cold
calling, but when recruiters cold call companies they are saying 'I have a
candidate, will you pay me to hire him/her?' whereas an agent would be saying
'I have a candidate that is interested in working for you, and it is free to
hire him/her' (or close to free). It's a big difference - you are offering the
same service as recruiters offered to companies, but you're giving it to them
for free.

If you are making cold calls to tech companies starved for talent, telling
them you can solve their problem for free (that they have been paying a LOT
for historically), the cold calls will get pretty warm pretty quickly.

~~~
TamDenholm
Thats good advice, thank you.

------
thedufer
I like the idea of an agent, mostly because I recently went through the
finding jobs thing and its not fun. Its worth pointing out that you could
probably convince a new employer to tack on to your signing bonus a
significant percentage of what a recruiter would have cost to them. That would
keep the cost of an agent fairly negligible.

On the other hand, what's an employer to think when they see that you have an
agent? I would see it as a sign of flakiness. If you need an agent, you must
be jumping around jobs a lot. That is not a good impression to make.

~~~
fecak
Author here. Good points you made here. As I mentioned before, I can't see
there being any reason why the agent couldn't charge at least some fee to the
company as well (which would be greatly reduced from what recruiters are
charging now, so their cost to hire would be lower).

I'm not sure what a company would think. If it were to become more common, it
would just be a way of doing business. I negotiate most of my candidates'
salaries and packages now anyway, so having an intermediary would not be a
huge leap for most companies that already use recruiters. The leap would be
the term 'agent', but I think companies would respect the fact that someone
takes their career seriously to have an advisor. We'll see.

------
dllthomas
I would love to have an agent - I am not very good at selling myself, and it
could free up time and attention for other things. If you can help me come out
ahead financially (while giving me at least comparably interesting things to
work on) I'd happily part with a good chunk of that monetary difference in
outcomes. In principle. In practice, figuring out what that difference is
seems nontrivial, but I'm listening.

~~~
fecak
Author here, happy to have direct dialogue with you as well as others that
have contacted me. I'm easy to find if you'd like to talk.

------
bartonfink
I would absolutely hire an agent. I have a day job, but freelance on the side.
I'd estimate I have about 20 hours a week of available time that I can use for
freelance coding.

I would LOVE to hire someone to help me keep those hours full. I have a day
job that pays me well, so I can afford to be generous if it means I never have
to wonder "Barton, are you just being strung along by this lead?"

~~~
fecak
Author here. If you want to discuss, I'm easy to find.

------
blitzcraig
As a developer, I can't help but see 3rd party recruiters as parasites feeding
off of my hard work and expertise. I see any money a hiring company pays to a
recruiter as money that could have been in my pocket via a signing bonus or a
higher starting salary if there was no recruiter involved.

I don't see anyone in this discussion questioning whether we, as job seekers,
even need 3rd party recruiters. In my experience, we don't. Throughout my 16
year career as a developer, I've only been placed by a 3rd party recruiter
once. That was way back when I only had a year of experience. I haven't needed
3rd party recruiters for the last 15 years.

If you want to disrupt technical recruiting, don't send recruiters your
resume, and don't work with them when they contact you. Instead, do some leg
work when you're looking for a new job.

Browse the job boards looking for positions posted directly by the company
with the opening. Contact people in your network about open positions where
they work. Find tech companies local to you, and look on their job boards.
(This is how I found my current position, and it is the best job I've had
yet.) If a recruiter contacts you about an interesting position and tells you
the name of the company that's hiring, bypass them and submit your resume to
the company directly.

Bottom line, they can't make money without us. We can make money without them.

~~~
fecak
That may be oversimplifying things just a bit, but if you are good at
everything a recruiter does perhaps you don't need one. Some people do their
own taxes, some don't.

What if I were to tell you that, in negotiating a job 15 years ago, you left
say 10% of your salary on the table (you took 60 but were worth 66). And every
raise you have received since was based on that number in some way, resulting
in compounded earnings loss for your career in the tens of thousands? You
don't have to believe this scenario is possible, but I talk to people every
day who are substantially underpaid for what they do, sometimes for years. If
they had an agent who knew their value, negotiating on their behalf, with
inside information on what that company pays other people in the same job,
they wouldn't have lost tens of thousands over the span of a career.

Your point about recruiters taking money out of your pocket is interesting.
You would assume then, if this were true, that companies that use recruiters
pay their engineers less? Or perhaps don't pay for hiring internal recruiters?
I've never seen any evidence of companies that use recruiters paying less to
engineers - have you?

I guess the alternate theory is that firms that use agency recruiters do so
not at the expense of their own employees' salaries, but simply because they
have the luxury (because they can afford both a recruiter fee AND to pay
employees a fair market rate). If you believe this alternative to be true, is
it a coincidence that firms using recruiters are in a better financial
situation than those that can't afford it?

Just playing devil's advocate here. Recruiters often have access to jobs hat
may not be in your network. Again, if you don't need them, don't talk to them
and perhaps miss out on some jobs you didn't know about.

And I would warn you about bypassing the recruiter after he/she told you about
a position. If a recruiter finds out about that (in small companies it is easy
to find out), the recruiter could very easily call the company to claim they
created your interest in the opportunity yet you applied directly, making you
look a bit dishonest to a potential employer and possibly costing you the job.
Recruiters have been paid by firms without sending resumes/referrals directly
in situations just like the one you mention.

Firms that use agencies value the service and are willing to pay for it. I do
list many of my client names on my jobs page, running the risk of people doing
exactly what you describe. My model is different (primary services paid up
front, usually exclusive searches), so I'm willing to take that risk to help
publicize my clients.

My service is such that job seekers come to me, even when they already know
who my clients are in advance in many cases, because they understand that I
know how to prep them to be successful in interviews, which hiring manager
will be good or bad cop, and how to negotiate at the end. I don't care how
well networked most job seekers are, info on a wide range of companies only
comes with experience with many.

Ever been turned down for a job you really wanted? A recruiter could have
helped prep you with all that info you didn't have (you didn't know that white
board exercise was coming, and you panicked). Even if you failed a first
interview, a recruiter may have been able to revive your candidacy by
advocating for you (references are good when that happens). I've done that as
well for candidates, where companies get the wrong first impression, and I've
had companies and candidates thank me years later.

Thanks for the comments and I'm glad to see dialogue with differing opinions.

~~~
blitzcraig
I would assume that a company that has the money to pay a fair market wage and
hire an agency recruiter would be able to give me that money as a signing
bonus if they hadn't already spend it on a recruiter.

Also, if I was an employer using your agency, I'd fire your firm if I found
out you were telling candidates what was going to be asked in a technical
interview. You're doing them a disservice by giving out this information. At
one of my jobs where I was interviewing new candidates, we had to make several
tests with different questions on each one because recruiters were telling
candidates what questions we asked on the test. This became painfully obvious
when candidates could answer test questions perfectly, but fell short on other
very basic technical question we asked. The recruiter cost us money since we
had to dedicate team member time to writing multiple tests instead of working
on developing our product.

This brings up another problem with agency recruiting. You can't represent
both parties without there being an inherent conflict of interest. At the end
of the day, most agency recruiters will misrepresent one party or the other to
make a deal and get paid. This of course leads into your article's suggestion
that job seekers have an agent who only represents them, but that begs the
question whether any sort of middleman is necessary in this sort of
transaction. Other industries manage to hire people without using an agency,
but recruiting is accepted as a necessity, almost without question, in the IT
industry.

Perhaps I am an anomaly because I can, as you said, "do my own taxes." To be
fair, I know there are agency recruiters out there who really do manage to add
value to both side of the equation. However, in my experience, they are the
exception rather than the rule.

p.s. Regarding bypassing a recruiter, I only do this when the company has
directly posted the listing themselves in addition to using a recruiter. If I
don't see the position posted elsewhere, I assume they are looking exclusively
through the recruiter, and I don't bother pursuing the position unless it's
exactly the position I've been dreaming about. At that point I'll grudgingly
work with the recruiter.

~~~
fecak
I would fire me too if I were telling people specific questions in an
interview. I tell things like to expect a whiteboard exercise, even if I'm not
sure it will be given. I would never give a interview question or something
meant to surprise.

Regarding your thoughts on representing both parties, that is exactly what I'm
saying. It would seem more 'just' to represent the candidate. I'd like to see
that model - companies need the referrals and candidate flow, but they can
represent themselves without much risk. Candidates mistrust recruiters because
recruiters are given the wrong incentives (representing both sides in a deal,
but only one pays?).

No explanation needed on bypassing recruiters, that is a decision job seekers
are free to make.

------
fecak
A follow-up, let's keep the dialogue going
<http://news.ycombinator.com/item?id=4575909>

