Okay, the common parlance is "professional recruiter," but really, they just want heads (attached to bodies…not, like, in a duffel bag). That's how they get paid, anyway. In fact, the term "headhunter" is pejorative and refers only to the riffraff of the industry; most professional recruiters realize that helping companies find employees is a lifelong endeavor, a real partnership—not a one-off transaction which ends with a very nice roasted pig in a sand pit and a body missing a place to put a hat.

But we think there's some glamour—or at least excitement—associated with the term "headhunter," so we're gonna stick with it.

Headhunters play a balanced game of cat and mouse where the playing field tilts like a teeter-totter in good economies and bad. The cat and mouse game is all about schmoozing the top talent—while getting the frantic begging call from bottom talent who's just been fired and has a mortgage, a high-maintenance spouse, and three kids who all need braces. That is, a headhunter is both a seller and a buyer of their service expertise.

Some extreme examples help illustrate the dynamic: Imagine what a top algorithmic computer engineer's discussion was like during the search wars (which Google won) in the early 2000s in Silicon Valley.

That top coder came from Stanford's PhD program, was already known, respected, and liked by the key management (i.e. the CTO or Chief Technology Officer to whom they'd report), and, in parallel, known via their professor's relationships...by the venture capital community who funds new companies. That candidate could almost literally "write their own ticket." Want a massage each day? No problemo. Mountains of candy? Sure. A boatload of stock options? You got it.

That's the cat.

And the economic climate was booming, at least in the search wars where dozens of companies were trying to "own" the consumer navigation of the web. So not only did that candidate have uniquely highly talented skills—they were in a climate where everyone was clamoring for their services. Companies in that space held, as weapons, the engineers they had in their stable—if they ran out of engineers who were the ones building new stuff, the companies lost the war and became dinner for the winners.

So in that environment, you—the would-be headhunter—would have gotten a sheepish call from the CEO of the company, asking for help. And that's a really wonderfully awesome call, as a headhunter, to get. (Cha. Of the Ching.)

But then there's the mouse.

You're now teleported to Detroit. It's the crash of '09. Nobody is buying cars. In fact, the car companies are going bankrupt, more or less. You'd made a career placing executives at GM (and in many industries headhunters are loyal to one firm inside of an ecosystem—that is, you likely wouldn't place executives at Ford if you're a GM gal).

Now the phone call flow is reversed. It's not the companies calling you begging to have you help them put arrows in their quiver; it's the executives who have either already been fired or, if they're smart, know that they are about to be fired, down-sized, and/or let go—and they want to get a half-step ahead of the stampede out the door.

"You gotta get me outta here...." Then you hear the story about the mortgage and the maintenance and the braces. And if the entire world isn't in a depression, and somebody is hiring, your next question might be, "So...how do you feel about Maine?" There might be silence on the phone from the other end or, if the exec is desperate enough, maybe he'll move.

And then of course, there's a gnawing question in your brain that asks why this exec is calling you—that is, is she the least talented? The first to be let go? Why wouldn't the company fight to keep her if she was actually good?

When you hold out a candidate for a position, it's your reputation on the line every time. Stick a company with a lunatic and your career may be over. CEOs talk.

Headhunters don't just place executives—they place board members, government officials, service people, and pretty much anyone else, as long as it results in them getting paid a commission. They also opine on fairness practices for compensation, legal matters, policies around sexual harassment, and really anywhere else they can do things...for a fee.

And those fees can be awesome. A headhunter placing a top exec at a hundred-person start-up commands all kinds of creative compensation packages, usually based on the first year's salary (and stock options and boni) of the person they're placing. Think: 0.25-1.0x. That is, an exec making $350,000 might be "found" through a headhunter for a fee to the company of $65,000. Nice work for a phone call. That's the high end.

But it's a big high end.

The experience is vastly different as a headhunter for a major firm versus just being a one-person shop. A major office like Egon Zehnder or Korn Ferry has thousands of professionals around the world with vast resources and a database system that taps directly into "every exec who matters." Because companies with 100,000 employees or more have vast resource needs in recruiting, many large firms provide "wholesale deals" in the form of ongoing contract services for headhunting needs.

With the large office comes a lot of bureaucracy, overhead costs, and fights to be first in line at the water cooler. But there's a brand, deep-seated relationships, and camaraderie. In some form, anyway.

At the other end of the spectrum is a lone wolf operator. A single person who is their company. Many headhunters who've spent twenty-five years covering a domain "know everyone" in their space. Working fifty hours a week at a big firm gets them $350,000 a year in salary and bonus—yet they provide billings to The Firm of a million or more, maybe much more.

So they ask themselves, "Why am I working so hard for all of this overhead? Sure, the secretaries and custom coffees are nice, but I have an answering machine and can get Starbucks on my own—then I can keep all the dough myself. And when clients call MegaGlop Headhunting Firm, they aren't calling MegaGlop—they're calling me."

It's all about relationships. Years of shmoozy, boozy parties and developing the persona that you "really know how to assemble talent"…that's the marketing platform under which you will market yourself and pay your light bill. A client calls and says, "Hey ho, I need a CFO"—and you say, "Hoo haw, let me bring you blah."

You scour existing companies in that related field (that is, if the CFO is being hired into a lugnut building company, you'd look for existing CFOs and maybe one step downers—like controllers or internal audit people with roles very closely related to that of the CFO—and…just call them). Like, who doesn't return a phone call from a headhunter?

And over time, if you've done twenty searches for CFOs in the lugnut industry, odds are good that you're going to have your own easily searchable database so that the search can be completed quickly with relatively low pain.

In any domain, there are usually only a few thousand execs qualified to do a given task so it's not all that hard to just...find all of them. At $20,000-$150,000 a search (source), if you can do one a month or so, it's a really nice gig. And you get to meet lots of people who are oh-so-happy to return your call along the way.

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