Dear SaaStr.ai: At What Point Should We Hire an Internal Recruiter?

Dear SaaStr.ai: At what point has a start up do you hire a recruiter internally versus paying recruiters 20% fees?

Hire a full-time internal recruiter once you’re hiring 5+ people per quarter consistently.

Here’s the math: If you’re paying 20% placement fees on $150K hires, that’s $30K per placement. An internal recruiter costs $60–80K fully loaded. So at 2–3 hires per quarter, you break even. Beyond that, internal becomes cheaper and way better.

More importantly, external recruiters spray and pray. They don’t know your culture, your actual ICP for roles, or what you’re really trying to build. An internal recruiter focuses on exactly the profiles you need and can source proactively instead of reactive placements. At Nebius, they prioritized in-house recruiters specifically because external ones couldn’t find the right talent for their GPU cloud business. External recruiters would have flooded them with mediocre candidates.

That said, **use external recruiters early. **Especially for hard-to-fill roles (your first VP Sales, a machine learning engineer, a specific domain expert). You’re not scaling fast enough yet to justify salary + ramp time for an internal person. And your network will only take you so far.

But once you hit that inflection point where you’re hiring regularly, bring someone in-house. It’s just too many candidates to process, too many meetings to schedule, etc. You don’t want your CTO doing all of that. Not once you are hiring more than 1 or 2 devs at a time.