Retained executive search: what it is, how it works and when it is worth it
In this article
What a retained search is, the steps it goes through, how the fee works, and how to tell if your hire needs one.
Retained executive search is a way of hiring in which one search firm works on your role exclusively and is paid in stages, usually starting before anyone is hired. The firm maps the market, approaches people who are not looking for a job, assesses them and presents a short list. It suits senior, rare or confidential roles, where finding and assessing the right person takes more work than collecting CVs.
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Contents
In short
- One firm, one role, no competing agencies.
- The firm searches the whole market, not only people who apply.
- You usually pay in stages: at the start, at the shortlist and at the hire.
- Part of the fee is often due even if you do not hire.
- A fixed fee paid after the hire is an alternative with the same depth of search.
What retained executive search means
"Retained" means you retain one firm for one role. You agree the role, the fee and the steps, and the firm commits time to your search from the first day. Other common names are retained search, executive search and, in some markets, headhunting.
The opposite is contingency search, where recruiters are paid only if you hire someone they introduced, and several agencies often work on the same role. We compare the two in detail in retained vs contingency search.
How a retained search runs
- Brief. What the role must achieve, the must-have experience, the offer range and who decides.
- Market map. A list of companies and people who could fit, including those who are not looking.
- Direct approach. The firm contacts people one by one and explains the role.
- Assessment. Interviews against the brief, checks of experience and motivation.
- Shortlist. A small number of candidates, each with a written view of why they fit and where the risks are.
- Interviews, offer and start. The firm supports feedback, references and the offer until a candidate signs.
Each step is described in more detail in the executive search process.
How you pay for a retained search
Most retained fees are a percentage of the new hire's first-year pay, split into stages. A common pattern is three payments: when the search starts, when the shortlist is presented and when the candidate signs. The first payments are usually not refunded if you decide not to hire.
Before you sign, ask which parts of pay count towards the fee (base, bonus, equity), what happens if the role changes and how the guarantee works. Our guide to executive search fees lists the questions.
When a retained search is worth it
- The profile is rare. Few people can do the job, and most of them are employed and not looking.
- The role is senior. A wrong hire would cost you a team, a client or a year.
- The search must stay private. For example a replacement that is not public yet. See confidential search.
- A previous search failed. Ads and agencies brought CVs, but not the right person.
It is usually not worth it for roles with many active candidates. There, a job ad or a contingency agency is cheaper and fast enough.
Retained, contingency or fixed fee
| Retained | Contingency | Fixed fee | |
|---|---|---|---|
| Exclusive | Yes | Rarely | Yes |
| When you pay | In stages, starting before the hire | After the hire | After the hire |
| How the fee is set | % of first-year pay | % of first-year pay | One amount agreed upfront |
| Depth of search | Full market map and direct approach | Often active candidates and databases | Full market map and direct approach |
How Talentholo runs retained-style searches
We run direct searches for specialist and leadership roles for companies in the EU, the US and Germany, wherever the role is. The founders, Marcin Cieszyński and Renata Chmiel, are responsible for the brief, the search strategy, the assessment and the recommendations. Our team supports part of the research, outreach and first screening.
We work exclusively on each role, like a retained firm, but our recommended model is a fixed fee: one amount agreed before we start and paid after the hire, not a percentage of salary. A success fee is also available. Most searches carry a guarantee of three to six months, agreed before the search starts. See how our executive search works.
FAQ
What is retained executive search?
A way of hiring where one search firm works on your role exclusively and is paid in stages, usually starting before the hire. The firm maps the market, approaches people directly and presents a short list of assessed candidates.
Can I stop a retained search?
Yes. The contract should say which payments you keep paying, what the firm hands over from the market map and how much notice you give. Agree this before the search starts.
Do I get my money back if I do not hire?
Usually not for the stages already paid. Read the contract: it should say what each payment covers and what happens if the search is stopped.
Is retained search only for executives?
No. It is used for any role where the right people are rare or hard to assess, including senior specialists.
Wondering if your hire needs a retained search?
Tell us about the role and we will say which model makes sense, and what it would cost.
Book a free 15-min consultation
