Updated September 2026
A contingency recruiting fee is calculated as a percentage, typically 20 to 25%, of the new hire's first-year pay, and it is only charged once someone is hired. For a $120,000 base salary, that is $24,000 to $30,000. The detail that changes the number most is how the contract defines "first-year pay", because some include sign-on and guaranteed bonuses as well as base salary.
Founders tend to negotiate the percentage and skip the definition. That is usually the wrong way round. On an offer with a sign-on bonus or a guaranteed bonus, the definition of the fee base can add several thousand dollars to the invoice, often more than knocking a point off the rate would save.
Every contingency fee follows the same basic sequence. The percentage is the step people remember, but steps one and four are where the surprises live.
Here is what the percentage alone does at three illustrative base salaries, with no bonuses included. Swap in your own offers to price your plan.
| Base salary | Fee at 20% | Fee at 25% | Each extra $10,000 of salary adds | Funded.club fixed fee |
|---|---|---|---|---|
| $80,000 | $16,000 | $20,000 | $2,000 to $2,500 | $7,500 |
| $120,000 | $24,000 | $30,000 | $2,000 to $2,500 | $11,500 |
| $160,000 | $32,000 | $40,000 | $2,000 to $2,500 | $15,900 to $21,900 |
The fourth column is the one to keep in mind during negotiation. Every time the offer rises by $10,000, a contingency fee rises by $2,000 to $2,500 with it. The fixed fee in the last column only changes if the salary moves into a different band on our pricing page.
Now take a single illustrative offer of $130,000 base, a $15,000 sign-on bonus and a $13,000 guaranteed first-year bonus. The percentage stays the same. Only the definition changes.
On base salary only, the fee is $26,000 to $32,500. Include the sign-on bonus and it becomes $29,000 to $36,250. Count total first-year compensation and it reaches $31,600 to $39,500. That is up to $7,000 more for the same person, the same role and the same rate.
Sign-on bonuses are often added late, to close a candidate who has another offer. If your contract counts them, the recruiter's fee grows at the exact moment you are stretching your budget. Agree in writing which items are excluded before the search starts.
For a wider comparison of recruiter pricing, see how much a recruiter costs for startups.
We use a fixed fee instead of a percentage, so there is no fee base to define. Funded.club is a fixed-fee recruiting partner for funded startups and fast-growing teams across North America, Europe and APAC, and we've helped 500+ startups from Seed to Series D. Our fees are agreed upfront, average 6 to 9% of salary and run from $4,900 to $21,900 per hire.
Part of the fee is an advance at the start of the search, with the balance due when your candidate accepts the offer. If we don't deliver a shortlist of at least 3 qualified candidates within 30 days, you can claim the advance back in full. One dedicated recruiter runs your search end to end, with first screened candidates within 7 days and an average of 33 days from kick-off to hire.
The recruiter multiplies the new hire's first-year pay, as defined in the contract, by an agreed percentage, typically 20 to 25%. The fee is only charged once someone is hired.
Either, depending on the contract. Some recruiters use base salary only, others include sign-on bonuses, guaranteed bonuses or commission. On an offer with bonuses, the difference can be several thousand dollars.
At 20 to 25% of base salary, it is $24,000 to $30,000. Funded.club's fixed fee for the same salary is $11,500.
It is usually invoiced once the candidate is hired, often on their start date. Check the payment terms and any early-leaver conditions in the contract.
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