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February 13, 2024

Thinking about starting your own Recruiting Agency? How to make the right decision.

John Kim
Co-founder @ Paraform

A lot of recruiters fall into either one of these categories: working in-house for a company or working for an agency. But there is a third avenue that I know a lot of recruiters think about but never bite the bullet on; becoming an independent recruiter or starting your own agency where you are your own boss.

As an in-house or agency recruiter, I’m sure you’ve thought; Wow, I just made all these amazing hires, I must be good at my job - I could make so much more money through this! Then fear sets in and the challenge
of unknown and stability issues come up. But rest assured, there are plenty of recruiters who took a leap of faith and stepped away from their corporate careers, started their own thing, and have never looked back since.

Caveat here: starting your own agency is actually not that easy, it’s in fact, quite difficult. Like starting any business, it has it’s challenges.

In this article, we’ll cover the difficult parts of starting your own agency and how Paraform makes it a much easier transition.

Biggest frustrations as an in-house or agency recruiter (as we know you know)

While yes, these roles are full-time and salaried, that doesn’t mean they aren’t unstable or have other major drawbacks. For one, and as we’ve seen in the recent years, the general job stability in the recruiting field is poor - we’ve seen roughly 150,000 recruiter layoffs in 2022/23, and the job turnover rate has reached its peak.

We also know that recruiters, both in-house and agency, don’t get the credit they deserve. Working crazy hours, with challenging, subjective hiring teams, getting underpaid compared to colleagues in different teams, one could argue there are more drawbacks recently then positives. Along those same lines, you’re doing repetitive work that you don’t really get too much choice on.

This is another way of saying: there’s much more upside to starting your own agency than you think, despite it’s challenges.

What makes starting your own agency so challenging?

Let’s go over challenges to starting your own agency. For one, there is less financial stability in the first few months (like starting any business). In recruiting, this is directly related to getting clients to work with. If you can’t find or retain clients, then there will be a lack of money coming down the pipeline.

Enter Paraform:

Paraform is a marketplace connecting companies with open roles and recruiters who can fill them. The companies are mainly early/growth stage tech startups and recruiters are either boutique recruiting agencies or independent/freelance recruiters.

Paraform eliminates most of the challenges of starting your own agency. Below we break down exactly how it de-risks starting on your own:

1. Clientele is there

The moment you get accepted to Paraform, you have access to some of the most exciting startups as your clients. You can immediately start working with the top 1% of Seed to Series C startups in the US in terms of traction and investors. We don’t want you to pitch companies that aren’t doing well to your candidates. We vet our companies so that you are genuinely excited to pitch them to potential candidates.

2. Interview rewards and bonuses

We’re the first in the industry to offer a reward for simply having your candidates interview. There is a reward at each interview step, and there are more incentives for the hard work you put in. We think recruiters provide way more value before they even submit their first candidates!

3. Intake information

When you do land a client as your own recruiter, one of the most time consuming parts is syncing with the hiring team and calibrating on the responsibilities, requirements, and expectations of the role, plus the general details of the company itself.

On Paraform, that’s all there; all the information you could ever need to properly sell the company, role, etc. through our initial intake call. We also offer a direct chat with the hiring manager in case you have additional questions.

4. Tools

We equip all of our recruiters with the necessary tools to be successful, which includes an email client, chrome extension for sourcing, built in ATS and CRM, candidate update notifications, and more!

5. Discounts to tools

On top of the tools we provide, we also partner with some of the best tools out there. We offer discounts to the best in class tools such as hireEZ,, Ashby, and more to come… 👀

6. Back office tasks

We’ve built out a unified contract with market competitive terms (paid out 30, 60, 90 days), candidate ownership clauses etc. We also handle and provide your LLC and 1099 tax information for you.

Payments are also usually yet another headache for independent recruiters so we took care of that. We’ve partnered with Stripe to provide seamless payment integrations, so you can get your earnings paid out immediately.

7. Client Management and Admin

Paraform helps you handle client management and admin. For example, if the client you’re working with is being unresponsive, there is a candidate ownership conflict, etc we have features built in place to help you reach an amicable resolution. Just ask Brooke, who we helped claim ownership with a candidate she placed on our platform!

You can read more testimonials from recruiters on Paraform here

Paraform gives you back ownership and choice. You choose which companies and roles you want to work on, when you want to work on it, with all the support that you would otherwise not get when starting your own agency.

Lastly, let’s talk brass tax and what everyone wants to know; earnings on the platform. The average bounty (or reward) per placement is between $15k with some reaching $25k+.

We sometimes get questions from recruiting agencies that the placement fees on Paraform is less than they make getting their own clients, but that’s because companies on the platform pays less as well.

Recruiters usually spend more than half their time getting new clients, meaning half of their placement fees can be attributed to the efforts of getting new clients, so the total ROI works out.

With the platform fee being 25%, recruiters take home majority (75%+) of what companies pay.

Top map out potential earnings, say you make 1 placement a month at $15k each - that brings you to $180k/year while working 10 - 20 hours a week. Here’s a real screenshot with one of our recruiters who made a placement recently:

Paraform is here to help you start your own agency, working and earning on your own terms. We have recruiters who paid off their siblings’ students loans or support their international travel and digital nomad lifestyle with what they make on the platform.

Now that there’s Paraform - why not start now?

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