recruitment business startup... first challenging step?
August 3, 2014 10:27 AM Subscribe
I have worked in recruitment for all of five months. Having previously run a less than successful but still operating and now growing charity, I missed the security of a regular paycheck. They like my sales experience but are not as experienced in teaching one how to recruit for their sector. I have had a few offers but have not closed a sale in two months for a flat fee recruitment advertising (no headhunting) product they are halfheartedly experimenting with. Out of 22 staff, I am only the only salesperson for it. I do earn a small monthly salary and could earn a commission. Out of left field, a family friend has come forward with a big recruitment opportunity with a software company. I am currently working on a split commission deal with a work colleague on a software role but do no recruiting, only manage the business communication. I feel ashamed about it and feel I could be of better service as an independent recruiter. However, I need some advice about starting up and feel I can't really get an objective account from senior leaders in the field.
I am guessing it will take me eight to twelve weeks to get my first placement and then eight to twelve weeks for the rebate period to be over so I can realize profits. So, probably five months before I earn a salary. My spending is small, but I give my partner about $800 a month for childcare and household expenses. I have saved about $1,600 and plan to give my SO my next paycheck entirely to pay forward expenses for the next three months and replenish her savings. She also works.
More importantly, a college acquaintance with software team management experience has offered to help me source candidates and interview them in exchange for a commission on placements. That is ultra useful since I know from experience what it is like to recruit a field one knows practically nothing about.
It will cost around $2000 in startup costs and I could do a lot of recruiting through referrals and social media instead of always buying ads. I have found a great domain name and am looking for a nearby and experienced accountant but have a tiny business plan and know how to set up a business and a business bank account. I think after travel and before phone, accounting will be my biggest monthly cost. I am going to focus on local clients and try to poach some big companies.
What am I clearly missing? What could I try or implement differently? How much should I put aside for this business to work from my dining room table? I have already quit smoking pot to get more focused and recruited help. I know I cannot always be 100% ready but want to think about challenges now before I am stuck in them.
I am guessing it will take me eight to twelve weeks to get my first placement and then eight to twelve weeks for the rebate period to be over so I can realize profits. So, probably five months before I earn a salary. My spending is small, but I give my partner about $800 a month for childcare and household expenses. I have saved about $1,600 and plan to give my SO my next paycheck entirely to pay forward expenses for the next three months and replenish her savings. She also works.
More importantly, a college acquaintance with software team management experience has offered to help me source candidates and interview them in exchange for a commission on placements. That is ultra useful since I know from experience what it is like to recruit a field one knows practically nothing about.
It will cost around $2000 in startup costs and I could do a lot of recruiting through referrals and social media instead of always buying ads. I have found a great domain name and am looking for a nearby and experienced accountant but have a tiny business plan and know how to set up a business and a business bank account. I think after travel and before phone, accounting will be my biggest monthly cost. I am going to focus on local clients and try to poach some big companies.
What am I clearly missing? What could I try or implement differently? How much should I put aside for this business to work from my dining room table? I have already quit smoking pot to get more focused and recruited help. I know I cannot always be 100% ready but want to think about challenges now before I am stuck in them.
You are paying child care and refer to living off your SO's savings while you have about two months living expenses saved. And need almost three months' living expenses worth of money to start up a business that will not show income (not even profit, but income) for five months. It sounds like you cannot afford this business right now. And, if you have a child, you cannot assume you can open your own business as a side job in addition to your salaried job without explicit conversations with your SO about what she is willing to sacrifice. Conventional wisdom is you need at least a year of living expenses - on top of the money you would need to operate the business - saved for you to draw on. Too much of your projections rely on things going perfectly according to plan.
posted by saucysault at 7:44 PM on August 3, 2014
posted by saucysault at 7:44 PM on August 3, 2014
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If you think "quitting pot and buying ads" will overcome your lack of money and experience in this field, you aren't ready to start your own recruiting business.
posted by oceanjesse at 11:55 AM on August 3, 2014 [1 favorite]