“I’ll Pay If I Like the Steak”: The Mad Economics of Success-Fee Recruitment
Recruiters work for free, gamble on outcomes, and chase ghost briefs. Contingent hiring isn’t smart business. It’s normalized exploitation.
Imagine walking into a restaurant, slapping the menu out of the waiter’s hand, and declaring,
“I’ll eat now, pay if I’m impressed, and by the way, five other chefs are cooking me the same dish. Best one gets my money.”
Ridiculous? Of course. Yet this is the accepted standard for how companies engage with contingent recruiters.
Recruiters are expected to invest time, energy, and expertise upfront with no payment unless the stars align. There is no commitment from the company, no skin in the game. Just a vague promise that if everything works out perfectly then maybe a fee will follow.
It is the only professional service that routinely operates like this. Imagine asking a lawyer to build your case and only paying if you win and enjoy the courtroom experience. Or expecting your accountant to file your taxes and then decide whether or not to pay depending on your refund.
Despite this, hiring managers still rattle off clichés like “people are our greatest asset” while treating the process of finding them like a zero-stakes game show.
Contingent Recruitment: The Netflix of Professional Services
Recruitment used to be a grown-up process. A company needed a critical hire. They partnered with a recruiter. A fee was discussed, expectations were set, and a search was undertaken with purpose. There was accountability on both sides. You paid for work, just like you would with any other professional service.
Then the modern business world decided that human relationships could be scaled like software. And somewhere recruitment was rebranded as a volume-driven contact sport.
Now, most companies don’t hire recruiters. They throw out a vague job description to a crowd of agencies and wait to see who replies first. It is no longer about quality. It is about who can fire over the most CVs in the shortest time. If one of those CVs happens to turn into a hire, great. If not, thanks for playing.
Success-fee recruitment emerged from this mess. You do the work, chase the leads, guide the candidates, and only get paid if the company eventually makes a hire and decides they like how it feels.
It is not a strategic model. It is a coin toss. A bet that someone else's chaos will miraculously align with your unpaid efforts. And for companies, it provides the illusion of control without any real investment.
You would never dream of asking a contractor to build your house for free just in case you like the way it turns out. But in recruitment, this has become standard operating procedure. Somehow, this gamble is seen as practical business strategy. It is not.
“We Had a Bad Experience with Retained Once” and Other Lies We Tell Ourselves
This one’s a classic. Right up there with “We’ll keep your CV on file” and “It’s not about budget.” The moment a recruiter brings up the idea of a retainer, clients flinch like they’ve been asked to invest in magic beans.
The go-to excuse? “We had a bad experience with retained once.”
What they really mean is: We don’t want to spend actual money unless we’re guaranteed a happy ending. One slightly bumpy experience, and suddenly the entire model is cast aside forever, while the company continues to fund marketing agencies, SaaS tools, and freelance consultants without question.
Nobody stops going to restaurants because they once got a bland risotto. Nobody abandons dentists after a rough cleaning. Yet with retained recruitment, companies cling to this singular anecdote like it’s divine insight.
Most of the time, the issue wasn’t the model at all. It was the execution. More specifically, their execution. Maybe the brief was a mess. Maybe the internal process was slow. Maybe someone’s cousin applied late in the game and suddenly made the shortlist redundant. But rather than reflect, it's easier to blame the model.
Every recruiter has dreamed of the day a client simply admits: “We used a retained recruiter, didn’t engage, then hired someone else quietly and vanished.”
Not because it’s good. But because at least it would be honest.
The Unicorn Brief and Other Executive Fantasies
Here’s how it usually begins. A “client," (a flattering term for someone who hasn’t paid you) reaches out with what they describe as a “crucial hire.” Urgency is high. They need someone yesterday.
Then comes the brief.
“We’re after a Head of Growth. Ideally someone who’s scaled a B2B SaaS company from £2 million to £50 million ARR, built teams across three continents, implemented RevOps from scratch, driven PLG adoption, and still rolls up their sleeves. We need humility, hustle, and a sense of humour. Budget is £70k.”
This is not a brief. It's a wishlist. It’s not even that these candidates are rare. It’s that they are imaginary.
Recruiters know this. But questioning the brief often risks bruising egos or derailing the illusion of urgency. So they nod, pretend this isn’t their ninth unicorn hunt this month, and start sourcing.
Over the next few weeks, candidates are paraded through a feedback loop of contradictions. Too strategic. Too operational. Too expensive. Not confident enough. Too confident. Can they move to Tasikmalaya?
Eventually, the role goes on “pause.” Or gets “absorbed internally.” Or worse, filled by someone who had been sitting in the company all along. The recruiter hears nothing. Silence becomes closure.
This is not hiring. It’s theatre that allows decision-makers to feel like they’re addressing a problem, while doing very little to solve it. And the recruiter? Just another unpaid stagehand cleaning up after the final act.
The Economics of Free Labor: Who’s Really Winning?
Let’s stop pretending this is a clever system. The numbers are brutal, and they tell the story better than any case study ever could.
A typical mid-senior search takes anywhere from 25 to 40 hours of a recruiter’s time. That’s the research, outreach, screening, briefing, feedback-chasing, interview-coaching, expectation-managing, offer-negotiating, and handholding. And that’s if the process moves at a decent pace, which it rarely does.
Success rates on contingent roles? Around 10 to 20 percent. That means, on average, a recruiter gets paid for one or two out of every ten roles they work. The rest of the time, it’s free labour for companies that can barely coordinate a single calendar invite.
It’s exploitation. It’s a system that pretends to be cost-effective while quietly bleeding talent dry. Companies love it because there’s no upfront fee. But contingent recruitment isn’t cheaper, it’s just deferred responsibility.
And in the process, everyone loses. The quality of the search drops. Candidates get rushed, mismatched, or lost in the shuffle. Strategic hiring decisions get reduced to speed dating. Brand perception suffers. Nobody remembers the company that ignored them after a third-stage interview.
Recruiters, meanwhile, slowly erode. They chase roles with no traction, compete with five other agencies on the same brief, and answer vague messages from hiring managers who have no intention of hiring soon. The result is a burnt-out industry of professionals who flinch every time someone says, “Can we jump on a quick call?”
Walk into any company’s About page and you’ll be greeted by a familiar chorus: “People are our greatest strength,” “We’re all about culture,” “Our team is everything.”
Lovely sentiment. Until it comes time to invest in the people responsible for finding those people. Suddenly the tone shifts. “Can you just send over a few profiles and we’ll go from there?” becomes the quiet default.
This is not a recruitment issue. It is a broader cultural one. A reluctance to value service unless there is instant gratification. A discomfort with committing to outcomes that require trust, time, and money. Many businesses would rather drag a vacancy across two quarters, recycle candidates through a broken process, and still end up hiring someone internally than admit they should have paid for help upfront.
Companies won’t blink at the cost of SaaS subscriptions or employer branding campaigns but wince at the idea of funding the human being tasked with filling a business-critical role.
So when someone says, “We don’t do retained,” the honest reply might just be, “You don’t value talent. You value convenience.”
At StratEx - Indonesia Business Advisory we partner with clients to provide high quality, high conversion executive search solutions. If you're interested in hiring more effectively, contact us for more info.