- The leadership talent market is very hot: record-high search volume, compensation, and search duration
- Traditional recruiting isn’t working: search firms are at capacity and top candidates are essentially unreachable
- Founders are increasingly leaning on their investors’ talent teams for help with leadership recruiting
Download Thrive’s 2021 Q3 Executive Search Report
In nearly every conversation we’ve had recently, we kept hearing the same refrain: As growth continues to soar, hardly anyone can keep up with the demand for executive talent in their normal course of doing business.
Talent, too, is getting more expensive, harder to find, and more difficult to convince to make a move. Consider: In our latest Search Report for the third quarter, we found…
- Base compensation alone is up more than 5% quarter over quarter
- Searches are taking 13% longer quarter over quarter
- Lead times for executive recruiting firms are upwards of four weeks
Building a slate of candidates just isn’t happening as quickly.
Enter the VC & PE talent partner.
“So many conditions of doing business are different now. Companies are either solving different problems, or they’re solving problems differently than expected. Perhaps there’s greater awareness of the value of working with search professionals to solve those problems, as there’s less conviction in the original brief.” - Bryce Keithley, Head of Talent at TCG
What’s changing? Here are a few things we found in our latest report.
Searches keep going up
Our dataset shows more searches have been opened through the first three quarters of 2021 than in all of 2020. And not just by a little. Opened searches have grown 27% over 2020 already—and we have three months left in the year.
Still, there’s no indication that the market will slow down.
In our survey of PE & VC talent partners, the biggest drivers of growth are, well, growth.
Looking at the numbers on a role-by-role basis, the quantifiable data appears to reinforce the anecdotes from search leaders and talent partners. No role in the market is down QoQ and YoY—a significant departure from the COVID rebound and earlier growth this year.
This may be the most competitive talent market ever
In our roundtable conversations and survey with talent partners, we heard three common themes for this development:
- The best talent already moved during the acceleration of the market, taking them off the table for now:
“The pool of candidates is getting depleted. People have switched recently and don’t want to leave their current job so soon.”
- Compensation expectations are higher than ever, ruling out some candidates before they even get into the process:
“We used to ghost candidates and now they ghost us. We’re using comp requirements as a data point to evaluate right-fit candidates.”
- The top search firms aren’t available to help source candidates:
“Many of our companies are on a 2-3 month waitlist with the top search firms.”
And that’s just to find talent.
While the market is driving to higher highs, search velocity slowed 13% QoQ in Q3—an interesting development, considering the continued acceleration of search velocity over the last five quarters.
To combat this, firms are beginning to fast-track candidates and adjust compensation. For example, more than 50% of the respondents to our survey said they’ve needed to adjust comp bands between 5-25%.
And the data backs this up: The average base salary is up 5% QoQ.
Talent partners are now required to support hypergrowth.
Historically, 72% of VC & PE talent partners have run less than a quarter of portfolio company executive searches. That number, however, is on the rise: 26% of talent partners we surveyed said they’re now working more searches than ever before.
In many ways, they’re becoming more deeply partnered with portfolio companies and helping them navigate the chaos of this time.
While respondents to our survey identifying sourcing talent as the biggest challenge facing them this year, nearly 60% of respondents said they’re now proactively identifying candidates for potential openings in the future.
They’re also serving as a thought partner to internal teams, helping reset compensation bands, and accelerating processes to get candidates offers faster.
Download the full report
Our latest Search Report includes a deeper analysis on these trends, insights from leading talent partners, and benchmark data to help you make more informed decisions.