You've already learned how to recruit. Now you're thinking about doing it for yourself.
If you're an experienced recruitment consultant, you've probably thought about starting your own recruitment business.
Perhaps you've been consistently billing £200k or £300k a year and wondering why you're only keeping a fraction of it. Maybe you're fed up with targets, internal politics or somebody else making the decisions.
Or perhaps you simply fancy building something of your own.
Whatever the reason, starting a recruitment agency might be more achievable than you think.
You already know how to find clients, attract candidates and make placements. The challenge is everything that comes with running the business around those activities.
The good news? You don't necessarily have to do it all yourself.
What do you need to start a recruitment agency?
There are a few things worth getting right before you hand in your notice.
1. A recruitment market you know
You don't need a revolutionary business idea.
In fact, starting in a market where you already have experience, relationships and a successful billing history is usually a much better bet than trying something completely new.
Ask yourself:
- Do I know where my first clients are likely to come from?
- Can I attract the candidates those clients need?
- Is there sufficient demand in my market?
- Can I realistically generate enough business to support myself?
You don't need guaranteed placements before you start. But you do need a credible plan.
2. Some money
This is often the biggest stumbling block.
You'll need money to get the company running, pay for the systems and services you need, and cover your living costs until the fees start arriving.
If you're supplying temporary or contract workers, you'll also need to think about funding their wages while you're waiting for clients to pay.
How much you need depends on your circumstances and how you're setting up the business.
You can fund it yourself, borrow money or find a business backer who provides investment and support.
Read our guide to recruitment business investors and backers.
3. The boring stuff
Registering a company is relatively straightforward. Running one involves rather more.
You'll need to think about:
- Company registration, banking and insurance
- Client contracts and terms of business
- Recruitment software and associated tech
- Job boards, LinkedIn, data
- Payroll, invoicing and credit control
- Bookkeeping, accounts and tax
- Employment and recruitment compliance
- Branding a website and email
None of this is particularly glamorous.
And while it's all important, it's probably not why you got into recruitment.
4. A plan for the first few months
Going from a monthly salary to running your own business can take some getting used to.
A placement isn't the same as money in the bank. Candidates pull out, clients change their minds and invoices don't always get paid when you'd like them to.
Be realistic about how quickly you'll start billing and when that money will actually arrive.
Think about your personal finances too. A business that's doing well on paper won't help much if you can't pay your mortgage.
Do you need experience to start a recruitment business?
There's no universal rule saying you must have worked in recruitment for a certain number of years.
But there's a world of difference between being able to register a recruitment company and being ready to run a successful one.
At Hilton Lord, we generally look for recruiters with at least four years' agency experience and a consistent billing history of at least £150K per year.
We're also interested in the person behind those numbers. You need to be motivated, resilient and comfortable making your own decisions.
Nobody's going to chase you to make BD calls when it's your name above the door.
Find out what we look for in a recruitment business partner.
Can you start a recruitment agency without doing everything yourself?
Absolutely.
You can start completely independently, buying the services and systems you need from different suppliers.
Alternatively, you can work with a company like Hilton Lord.
We back experienced recruiters to start their own recruitment agencies. You build the business, develop the relationships and decide where you want to take it.
We put the infrastructure in place and look after the operational side, including finance, payroll, legal support, recruitment technology, candidate access and funding.
You own 75% of the business and you're the sole director.
You can work from home and build a business around your own billings, or recruit a team and develop something much bigger.
That's your decision.
Is starting your own recruitment agency worth it?
For the right person, it can be life-changing.
You get to make your own decisions, keep more of the value you create and build a business that's yours.
But it isn't a guaranteed route to easy money.
You'll have quieter months, difficult clients and probably a few sleepless nights. You also need to be comfortable with the responsibility that comes with ownership.
If you're already a successful recruiter, though, you may be closer to making the move than you realise.
Thinking about making the leap?
We've helped experienced recruiters across a wide range of markets start their own businesses.
If you're wondering whether it could work for you, let's have a conversation.
No presentations, no hard sell. Just a chat about where you are, what you're thinking and whether we might be able to help.