Start a Recruitment Agency

Placement Economics & Runway Worksheet

Companion to "The fee model and the math on one placement" and "Working for free: the cash-flow truth."

1. Fee math (niche salary band x fee % = fee per placement)

Direct-hire fee band: 15 to 30 percent of first-year base salary, 20 percent the most commonly cited rate. Worked table from the course:

First-year salary	Fee at 15%	Fee at 20%	Fee at 25%	Your niche
$50,000	$7,500	$10,000	$12,500
$90,000	$13,500	$18,000	$22,500
$140,000	$21,000	$28,000	$35,000
Your average: $				$

Your niche chooses your income ceiling: the same effort that produces a $7,500 fee on a junior role produces $21,000 on a senior one. Fee basis: first-year base salary, not total compensation.

2. Placements-per-month scenarios

Operator consensus (not a promise): a competent full-cycle recruiter runs one to two placements a month, a touch lower on six-figure desks; three is above average. Year one runs less while the client pipeline builds, with several zero-placement months.

Scenario	Placements/mo	Avg fee	Gross/month
Year-one realistic	1	$18,000	$18,000
Healthy market	2	$18,000	$36,000
Worked from the course: $90,000 roles at 20%, three placements across the first six months of revenue = $54,000, arriving unevenly	0.5	$18,000	$9,000 avg

3. Burn, need, and months of coverage

Line	Figure (course anchors)	Your number
Monthly business burn	under $300/mo with free tools; closer to $500 with a paid LinkedIn seat or paid ATS	$
Personal monthly need (housing, insurance, food, debt, everything)		$
Total monthly need		$
Months of coverage = savings (or bridge income) ÷ total need; multiply need by six at minimum	six months minimum

4. Week-by-week cash timeline

Weeks since launch	What is happening	Cash in
1-4	Biz dev outreach, first fee agreements, niche confirmed	$0
5-8	Sourcing pipelines, first submissions, first interviews	$0
9-16	Processes maturing, offers appearing, first falls-off likely	$0
17-24	First acceptances, start dates, first invoices aging	$0 to first fee
25+	Fees clearing, guarantee windows opening and closing	Irregular revenue

Sequence behind the table: fee agreement (weeks of outreach) + pipeline build (~2 weeks sourcing) + client process (most professional roles take 30 to 90 days to fill) + notice period (2 to 4 weeks) + payment terms (10 to 30 days). Optimistic path to first cleared fee: three months. Typical: longer. First-placement reports run from weeks to seven months; the more established your network, the shorter the gap. December routinely stalls on budget cycles: plan a thin final quarter.

5. Guarantee-hold discipline

Most guarantees sit inside 30/60/90-day windows, 90 days the most common single choice; remedy is typically a free replacement (better for you) or a prorated refund. Worked example from the course: a 90-day guarantee with prorated refund on a $22,500 fee means a third of it can evaporate if the hire leaves in month two.

Fee	Slice held until window closes	Window closed, hold released
$	$	☐
$	$	☐
$	$	☐

Mark the slice of each fee held until the guarantee window closes. Invoices go out the day the candidate starts; net-10 is the operator default, stretching to thirty for clients who negotiate.