(Before You Wire 25 % of Salary to Someone Who’s Never Used Slack)
Searching “recruiting agency pricing” turns up a jungle of percentages, retainers, and fine print. For cash-strapped startups, every euro that isn’t going into product or runway matters. So let’s cut through the gobbledygook:
| Model | Typical Cost | When You Pay | Hidden Gotchas |
|---|---|---|---|
| Commission / Contingency | 20–30 % of first-year salary | After hire signs | “Replacement fees,” ballooning costs on senior hires |
| Retained / Executive Search | ⅓ upfront + ⅓ short-list + ⅓ offer (often 25–35 %) | Throughout search | You pay even if you fill the role yourself |
| Fixed-Fee (Funded.club style) | €3,900–€9,000 per role (≈ 6–7 % for most startup salaries) | Small advance + balance after hire signs | None—price is price, no % surprises |
High salaries, low turnover: corporate VP roles paid six figures and stayed for years.
Resume fax machines: sourcing was literal leaf-raking; agencies guarded their Rolodex.
Startups were rare: the fee was a rounding error for Fortune 500 budgets.
2025 reality? Startups hire fast, iterate titles, and remote talent is global. The old model creaks louder than a modem handshake.
| Example Role | Salary | Commission @ 25 % | Funded.club Fixed Fee | Savings |
|---|---|---|---|---|
| Senior Backend Engineer | €95k | €23,750 | €6,500 | €17,250 |
| Head of Growth | €120k | €30,000 | €9,000 | €21,000 |
| Customer Success Rep | €50k | €12,500 | €3,900 | €8,600 |
(Multiply that by five hires and you’ve got a seed-round extension.)
Misaligned incentives – Agencies push higher salary offers (bigger % for them, higher burn for you).
Candidate churn? You pay again – 90-day replacement promises often exclude voluntary quits.
“Free” until hired – Sounds nice… until three firms carpet-bomb LinkedIn and taint your brand.
Role inflation – Agencies nudge you to senior titles to justify bigger fees. (Do you really need a VP of Ops at 12 people?)
True tale: A London SaaS startup paid £28 k commission for a VP Sales who left at month 8. Replacement discount? 20 % off the next £28 k. Founder’s reaction: 🍋.
| Startup Need | Fixed-Fee Advantage |
|---|---|
| Budget certainty | Fee is set; board & CFO stay calm. |
| Speed | Recruiter paid to fill, not haggle over comp. |
| Role agility | Need to tweak scope mid-search? No % recalculation nightmares. |
| Culture fit | Fixed-fee partners focus on successful placement > paycheck size. |
Flashback: When Supernova.io scaled post-funding, they hired 14 roles via Funded.club, saved > €210k, and eliminated an in-house recruiting team. (CEO’s words, not ours.)
Nope.
No salary-based upsells.
No multi-tier retainers.
One transparent invoice, zero footnotes.
That’s why our average cost is ~6 – 7 % of salary—less than one-third of traditional agency pricing.
Pre-seed / Seed: Burn is life. Fixed-fee keeps costs predictable.
Series A–B blitzscaling: Multiple hires? Commission stacks like LEGO fees. Fixed-fee scales linearly.
C-level searches: Executive retainers still have a place—just know every tranche before signing.
Compare your numbers with our free Recruiting Cost Calculator.
Or jump straight in—Book a call and see candidates in < 7 days.
Funded.club: Fixed-fee. Fast. Founder-friendly. (And yes, we still use Slack.)
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Fixed-fee recruitment averages about 6-7% of salary - less than one-third of traditional agency pricing. For example, when Supernova scaled after funding they hired 14 roles through Funded.club and saved over 210,000 euros, eliminating their in-house recruiting team.
Fixed-fee is better for most startups making multiple hires. Costs are predictable and scale linearly, while commission stacks up with every hire and rises as salaries rise. Retained search still has a place for C-level roles - just confirm every tranche before signing.
Startups can reduce recruitment costs by avoiding salary-based commission and multi-tier retainers, using one transparent fixed fee per hire, and resisting the role and title inflation that commission agencies use to justify bigger fees.