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Don't Die in the Saddle...

Executive Talent Market Overview

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A New Model for Search

Equity Corps vs. Search Firms

When to Call

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...we grew cash flow and profits.

Mike Malik

Founder & CEO

Triad Communication

 

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EQUITY CORPS vs. search firms

There are three main conventional outsourcing options for filling an empty C(x)O chair – retained search, executive interim management, and contingency search.  Equity Corps offers an alternative to conventional C(x)O search - Professional Management On Demand.  Each option has strengths and weaknesses, and will make sense for different companies at different times and under different circumstances.  The following table below presents the pros and cons of each as we understand them.

Table - Outsourcing Options for Executive Search & Acquisition

Retained Search

Pros

Cons

Executive Credibility – Possess the credentials and business experience necessary to attract top talent.

Search Competence – Proficient at the nuts and bolts of specification, search management, vetting; etc.

Commitment – Will commit to work on your search until you either cancel the project, or it is complete.

Great Service – Firms are customer-centric and adhere to standards for professionalism and ethics.

High Failure Rate – 33% of retained searches fail to complete, according to the industry association.

Most Expensive – 33.33% of first year compensation.

No Performance Incentive - fees are paid regardless.

One-Sided Fee Structure – 1/3 down payment; 1/3after 45 days; 1/3 due 45 days after that.

Junior Staffing – Firms cut costs to by assigning inexperienced, junior people to your project.

Contingency Search

Pros

Cons

Hi Volume – Transactional model great for multi-seat assignments, like staffing a sales team or IT project.

Specialization – Narrow functional or industry focus results specialized professional networks often useful for searches below the executive level.

Contingent Fees – The firm only gets paid if the client hires one of the firm’s candidates.

Less Expensive – 25% - 30% of first year comp.

Low Executive Credibility – Unlikely to attract top talent.

Lower Executive Search Competence – Minimal vetting; lower competence at search nuts and bolts. 

Requires Strong Oversight – Transactional mindset = No obligation to complete and short attention span.

No Refunds – Non-Refundable Fees are paid at hire.

Executive Interim Management

Pros

Cons

Very Fast – Staffed within days or weeks.

Pre-Vetted Executives = fast C(x)O acquisition.

Maximum Flexibility – Executive does not become an employee, and can work month-month, fixed term, or test drive (to convert to employment).

No Lump Sum Fees.  Firm’s economic incentives are aligned with the client’s.

Can be expensive.  Comparable to the fully loaded total payroll cost of hiring a top C(x)O.  Typical range is $20,000 - $40,000 per month.

Smaller Universe – Candidate pool is limited to executives available at moment of need.

Pros

Cons

Highest Vetting Standards – Every executive is rigorously vetted prior to client introduction.

Very Fast – Pre-Vetted Core Team = fast searches for permanent C(x)Os and fast interim deployment.

Shareholder Value Focus – Establishes a foundation for driving returns during the search, and supports Owner and C(x)O performance after the search.

Win-Win Fees – Month-to-Month fee structure aligns firm’s economic incentives with client objectives.

Competence, Service & Exec Credibility Retained.

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Equity Corps LLC     202-449-8500     C(x)O@equitycorps.com      www.equitycorps.com

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