Hiring is hard and it doesn’t matter if you’re hiring for a waiter or the CTO of McDonald’s, the challenge is universal and industry agnostic. Convincing more senior talent in the VP, Director, and C-suite is so challenging for companies that there exists a plethora of extremely profitable executive search agencies that solely specialize in taking on that challenge of finding leaders for companies small and large.
There are tons of other strategies and techniques used to lure and hire experienced talent and the pandemic has certainly changed how companies are approaching and conversing with potential leaders. For what feels like the first time, but maybe I am wrong (that happens a lot) there seems to be a super high amount of demand from companies to hire technical leaders and the supply of attractive and actively looking candidates has not been raised to adequately meet that need.
For this article I spoke with 25+ executive search firms, founders, VPs of talent, COOs, and other leaders at companies as small as 5 and as big as 20,000 employees about the current trends, unique challenges, interesting new senior hires, different strategies, and successful tactics for hiring C-suite and executive level talent. The way my article format usually goes is I give a brief intro in the beginning explaining the context of the topic I am writing about (this part) and then I give a summary with the juiciest insights I took away from each call I had. Out of my 25 calls, my favorite insight came from Greg Selker at Stanton Chase, who has had over 30+ years of experience in executive search. Rather than summarize and shorten his quote, I’m going to put it in in full to set the scene for the rest of the quotes. This great explanation for why hiring executives is harder than ever and what factors are causing this problem helps put everyone’s perspective into the bigger puzzle in a clearer way:
“Executive recruiting used to be a 20%-80% rule. 20% of the available candidates were the A+ players and 80% weren’t the best talent. The biggest change in the industry is that it’s now a 93%-7% rule now. The way in which we are training individuals to become successful in tech is largely through traditional education. No matter if you are a marketer, sales professional, programmer, we still all look for people who have gone to school, have advanced degrees, and have leveraged their education to gain employment and in-turn have leveraged that to land even higher paying jobs. That is broken. We simply do not put enough people through that system. I had a client who only wanted to source candidates who had MBAs from Wharton, Stanford, or Harvard.
The pace of acceleration of business has increased exponentially. It used to take five years to grow to $25M and another five years to grow to $150M. Now, the pace at which business can accelerate is incredible; there are tons of possibilities for hockey-stick growth in the current business world. The issues that are driving that growth are mainly around tech-based trends in the marketplace. Companies are needing to automate and go digital and unsurprisingly the pandemic fueled and demanded this. Today, you can quickly access massive amounts of unstructured data and the access to that data has never been easier. All of these factors that are leading to this acceleration of business has made recruiting for executives that much harder. The speed at which these businesses can grow increases the amount of opportunities available for talent but the talent supply isn’t increasing as quickly.”
With that context in hand, here’s what I learned from the 25 companies and executive search firms I spoke with last week.
Alex Maclaverty, Global Chief Operating Officer of Clarity PR
The new world of flexibility has exacerbated the challenge of hiring C-level talent. Most C-level executives have the luxury to choose where they want to do their work. They don’t want a standard package, they’re not interested in a full-time office type of role. Successful recruiting is about reimagining the C-level role and what it looks like. People are more interested in a portfolio career instead of working at one place for a while. They like to mix and match, and that has been sped up for people realizing. Equity is a very motivating factor, I’ve seen people willing to take a paycut, the bigger picture is way important.
Matt Wisk, CEO of Be My Eyes
When hiring C-level talent, people’s individual drivers are important to remember. For some people the purpose [of the job] doesn’t matter as much – they have bills to pay. But the percentage of people interested in purpose has gone way up. C-level executives want to add value with their unique talents.
Shawn Cole, President of Cowen Partners
There are really not enough qualified C-level candidates across the board. During the pandemic, CFOs were really in demand. It was hard to find CFOs qualified at forecasting because businesses were living day by day. CTOs are really hot right now and we are seeing a huge progression from CIO to CTO. The pandemic has accelerated the need for strategic CTOs.
Natalie Stute, Chief Human Resources Officer at Gainwell Technologies
We find it’s hardest to find C-level talent in the technical space. You have to pay a competitive salary and offer benefits that people truly care about. Gainwell Technologies truly cares about our employees and shows that through initiatives like our $10K reimbursement for education and student loan payments.
Desiree Pascual, Chief People Officer at Headspace Health
It’s really important to nurture the relationships with C-level talent, even if they don’t come on board. We’ve had instances where a candidate didn’t work out or took another offer and then a year later, an opportunity came up for a C-level position and we reignited the conversation and it was the right match.
Sergiu Matei, Founder of Index
Across the board, we are seeing Heads of Engineering, Heads of Product and CTOs are the most common roles in demand. If you are in a large US city those executives are even more expensive – we’ve seen salary inflation go up 30% across the board.
Mike Doonan, Managing Partner at SPMB
At SPMB, we average around 400 executive searches a year for our clients. In today’s market, marketing and sales roles are some of the hardest to execute. I find that in up markets as we’ve had in the past few years, companies try to sell as much product as they can and this drives the need for more senior marketing and sales executives. In down markets, companies tend to double down on innovation and therefore hire more technical executives in the form of engineering, IT, product, data and security. We’re seeing a big uptick in clients hiring CTOs, CIOs, CDOs, CPOs and CISOs, which may be a leading indicator of what’s to come.
Marie Mathilde, Chief Human Resources Officer at Withings
For a company like ours it is crucial to identify when and who we need to hire to keep our growth going on and to structure the team efficiently with the right leaders and experts. Our experience has taught us that to meet our goals we had to invest not only in the R&D to continue developing our areas of expertise and keep offering the best solutions to our users but also to invest in our people. And with the growth of the company we obviously had to recruit the right people to lead the teams and strengthen the structure and to do so we had to dig to find senior talents. We not only identified them through checking their profiles and references but we wanted to think in correlation of what we could bring them in terms of challenges and not only count on their solemn experiences and knowledge. We wanted to build the roles with the profiles we identify on a win-win based approach meaning we wanted them to not only benefit from being part of a fast moving company driven by great mind set to empower users with the right tools to help them take the right decisions for their health but also to increase the value of their knowledge and past experience.
Mario Malave, CEO at Wagr
Leaning into what a startup has to offer to senior talent is a challenge. Founders fall into the trap of “how can I create a competitive package?” When you’re a startup, talking about upside is now what you need. Look for people who are motivated by how hard it is. Remote work has allowed us to broaden our search and our scope of potential candidates. Our 4 executives are not in Tennessee, which is where we are mainly based. We could be more selective to find the right fit in our search for our leaders. We have found much more ideal fits this way. Finding a Head of Engineering who likes sports is hard to find in-person, but we found him in LA.
Kevin Williamson, Partner at Parker Remick
In the months after the height of the pandemic, we saw the biggest growth in the industry ever. Video changed everything, instead of taking time off to interview, you can just Zoom. Our search time to close is much quicker than it was pre-pandemic. Now, we are seeing hiring just on video. We are not going to go back to in-person interviews 100. We are in a crazy time for tech leaders, the amount of demand and money is insane. The top technologists are in incredible demand. The last two years cash compensation has gone up by 25% with people we work with. There’s a lot of money being raised by VC in the last two years and that money needs to be put to work.
Dora Vell, CEO at Vell
Location is not so important anymore in many ways. This leads to many changes in the target pools of candidates. Many clients swear they will never go back to the old model (even if they were very adamant before as to location). This is a double-edged sword: on one hand, it opens the pool of candidates significantly. On the other, the best people are targeted regardless of location. Executives and employees have more opportunities open to them and hence may move to a company previously not open to them.
Bobby Gormsen, Director, Executive Search at Riviera Partners
The last couple of years have forced us to think outside the box. Candidates are exerting more control over the hiring process. We deal with top tier candidates, if they are active in the market, they will have multiple offers on the table. Companies that can do a fast and efficient interview process will win out. Speed is king. Candidates are more so than ever looking to upgrade their role. It’s not a lateral move type of environment, we are not seeing candidates make sideways moves; they are using the market to up-level their title and compensation.
Sanjoe Tom Jose, CEO at Talview
A lot of companies became more comfortable with remote talent at executive levels during the pandemic. That has changed the equation on both sides. This change has promoted a lot more diversity in leadership talent because of flexibility of location and WFH. Improving the speed of the hiring process is one of our main value-adds for our clients at Talview. 4/5 candidates who drop out of the hiring process are because it takes so long. The best candidates are only on the market for 10 days.
Peyton Marcus, COO at OpenWeb
We focus heavily on interview prep work, thinking about the scorecard for a role, making sure the interview panel reaches questions about the goals of the role. A lot of time people get off topic and forget to ask questions that see if the candidate has the right skills. So, we have spent a lot of time on making sure those processes are in-depth. To find the right candidates, you need to be honest about the problems you actually have and don’t over sell. You’ll find better fits that way.
Jonathan Reyes, VP of North America at Reejig
The profile of what an executive is and does, has changed. You have to have functional expertise but you have to have done different things. The type of leadership skills you need are really different from how they were pre-pandemic. CFOs don’t need to be a finance guru. Because of the lack of supply of talent, people are now more likely to take chances on people with less experience, both internally and externally. The idea of fragmented-hiring is yet to take over the startup leadership market, but it’s certainly coming. Smaller startups should ask themselves, ‘Do we need a full-time CFO? Probably not, but how do we get access to that market and skillset anyway?’ Some marketplaces now offer 6 hours of CFO leadership. That’s hugely impactfully. This is a new type of marketplace that’s coming. In 5 years, fragmented workforces will essentially normalize freelancing for senior executives.
Yvette Swagerman (VP Talent) & Melanie Gabriel (Co-founder CMO) at Yokoy
When hiring C-level talent, you can’t compete with the big bucks. You need to sell the future of the company. We look at companies who have a similar type of foundation as Yokoy to find prospects – we want to tap into companies that have employees with knowledge and experience that we can benefit from. Building relationships is key in bringing C-level talent on board. CTOs get bombarded with outreach and you need to find ways to stand out. I comment on an article they wrote, or a post that they did. Building a longer-term relationship is a great way to make sure if someone is actually a good fit.
Jen Gere, VP of Talent at Signify Health
C-suite talent is the talent that moves and shakes the direction of the company. The challenge is in making sure you’re investing the time to develop relationships between potential candidates. It’s about the candidate getting to know us less so us getting to know them. When you meet people who share that same passion, that magnetic pull that pulls you both is magical. One of the executives we hired, during the pandemic, innovation really drives him. In the morning, he wakes up and comes to work and wants to solve challenges. We are doing something that nobody else has tried to do. That really motivates and drives the right people. We are trying to transform the way health care is paid for; it is a challenge that excites the right people.
Matt Abbott, President at The Sourcery
At The Sourcery, we have a different model than traditional executive search firms; we simply bill our clients for our time. We also mainly work with Seed-Series A clients who oftentimes don’t have an internal recruiting team that’s structured, which is where we come in and take over. We talk internally about ‘the why’ about the client, and we use that information to talk to candidates to see if they’re a good fit for the client’s mission. We want to assess what motivates potential candidates at work and what motivates our clients to hire.
Dave Hurt, Founder & CEO at Verb Data
One of the new approaches we’ve taken when hiring C-level technical executives is that instead of giving them homework or having them write some code, we have them take a look at our screens and do a live code review. We have candidates truly review how we work and share how they would make changes. Engineering take-home assignments are falling out of favor.
Kelli Vukelic, CEO at N2 Growth
An impact of the pandemic is that we are now able to measure candidates’ conviction and passion for an organization. People are being thoughtful about what they do, people don’t want to waste time anymore. The process for us and how we think about finding a leader, we are looking for purpose alignment.
Greg Stock, Head of Recruiting at Sirona Medical
At the C-level, people are thinking strategically about the direction of their career. Spending more time on the mission has become more pronounced, people are stepping off the treadmill and seeing what they actually want to do. Culture and mission matters more than it used to. Work culture says something about leadership, if you’re going to be a hybrid what does that say about how they value employees?
These conversations have been edited and reduced for clarity. Special thanks to Sasha Fyffe and Kathleen Walsh for making this article (and my dreams) come true 🙂