How Top Recruiters Win | The Owners Table Podcast
Hiring the right people is one of the most important decisions a business leader makes—but it's also one of the most challenging.
In this episode of The Owner's Table, Thomas Cox sits down with recruiter David Hicks to discuss what he's learned after more than 25 years in the staffing industry. Their conversation covers everything from building an effective hiring process and avoiding costly hiring mistakes to retaining top talent and creating opportunities for employees to grow.
Whether you're hiring your first employee or leading a large team, this conversation offers practical insights on recruiting, leadership, and making better hiring decisions.
Thomas: You're a local Birmingham guy and you've been recruiting for 25 years. Let's go back to the beginning. Tell me about how you grew up, what you wanted to do, college, all of that. Give me the short version.
David: I was born and raised in Hoover. I went to Alabama and got my degree in Management Information Systems with a minor in Computer Science. I didn't really like programming, but I liked the business and functional side of IT.
After graduating, I came back to Hoover and got a job as a database programmer with a company here in town.
I did not like it at all.
At that time, my father was the regional manager of a large staffing company, and he had been trying to get me to come work for him out of college. I told him, "No, I don't want to do the dad-son thing. I'm going to do my IT career."
After about a year in that database job, I knew it wasn't for me.
So I finally told him, "I'll come give it a try. But if I'm not any good at it, you've got to let me go. I'm not going to do the nepotism thing." It turned out I was really good at it and really enjoyed it. Then my dad left the company about six months after I started.
Thomas: Twenty-four years. Being at one company for that long and doing well financially creates what people call "golden handcuffs." Most people listening are either in a job they don't love or they're in a job they're comfortable with but want to start something of their own. Twenty-four years is a long time.
How did you make the decision to leave and start your own business?
David: Anybody in sales can relate to the idea of golden handcuffs.
When two-thirds or more of your income comes from commission, and you've built a roster of clients and placements that generate recurring income, it's very difficult to walk away and start over somewhere else.
I was making good money. I was comfortable. Everything was good.
Then, in December of 2023, I found out that a huge portion of my commission was going to disappear because those contractors were being converted to permanent employees. That changed everything.
Thomas: Before you keep going, I want to explain the staffing industry. There are two ways recruiters make money. Explain those two models.
David: The first is the contract staffing side of the business.
These are hourly employees that you recruit to work at a client company. They're billing hourly, we're paying them hourly, and as long as they're on contract, the recruiter earns commission on that person.
Thomas: Use the $50-an-hour example.
David: If we're paying somebody $50 an hour, we're probably billing the client around $75 an hour.
The company makes that $25-an-hour margin, and recruiters and salespeople earn commission on that margin for as long as that person remains on contract.
Thomas: So let's say that person is on contract for six months. Every month, you're earning commission from that placement?
David: Correct.
Thomas: That's contract recruiting. What's the other side?
David: The other side is direct hire or permanent placement.
That's like what I did for you.
I find someone, the client hires them directly as a full-time employee with salary and benefits from day one, and the client pays me a percentage of that person's base salary as a one-time fee.
They're never my employee. They go directly to work for the client.
I receive the placement fee, and then I'm done.
Thomas: I'll use myself as an example. I hired someone through David. I think the salary was somewhere around $70,000 to $80,000 a year, and I wrote David a check for around $15,000. I'll be honest—that was scary. My first thought was, "What if this person leaves in six months?"
But I'd do it again.
The amount of time it saved me was unbelievable. I wouldn't have known where to look for an executive chef, a salesperson, an accountant, or any of those roles.
I'm running my business—not recruiting.
Paying you that fee was hard the first time, but afterward I realized it was worth every penny.
David: That's exactly the point.
Once you figure out what your own time is worth, that fee starts looking very different. If you spent days or weeks trying to fill the role yourself, what is that worth? It's hard to put a dollar amount on your time, but if you don't already have a proven hiring process, bringing in someone who does can save you an incredible amount of time and effort.
Thomas: When you left corporate America to launch R3cruit, what's one thing you said you'd never do again?
David: Worry.
The large staffing company model is driven by metrics.
How many interviews did you get this week?
How many submittals?
How many placements?
Then you meet and talk about all those numbers. It's a constant grind. Most recruiters and salespeople would tell you the same thing. Some people enjoy that environment. Others don't. For me, it was constant worrying and constantly chasing the next number. It's nice to be away from that.
Thomas: From a high level, what's your process when you're looking for someone?
David: There are three main steps.
The first is research.
That includes sourcing, understanding your client, understanding the hiring manager, and asking a lot of questions. I need to understand what Thomas actually needs. What experience are you looking for? How many years? What specific skills are required? The better I understand the client, the more time I save later in the search. Research also means identifying the ideal target candidate. That's step one.
The second step is recruiting.
You need specialized tools that most staffing companies invest heavily in. They're expensive, but they're necessary.
The third step is representation.
Once you've submitted a candidate, your job is to represent both the candidate and the client throughout the entire hiring process. That means keeping everyone updated, keeping communication flowing, and making sure both sides have a good experience. You want to represent your client well and help candidates understand why it's a great place to work—but you never exaggerate or misrepresent either side.
If a candidate has a bad experience with a recruiter, they're much more likely to associate that experience with the client than they are with the recruiter.
Sometimes that's warranted, and sometimes it isn't. But as long as you keep communicating, people are usually understanding. Most adults just want to know where they stand. If they didn't get the job, tell them. If they're moving forward, let them know. If they received feedback, share it with them.
Good communication creates a good experience for everyone involved.
Thomas: Do you have specific software that helps you find candidates?
David: Yes.
I won't get into the names, but recruiters use enhanced versions of tools that most people already know about. Those enhanced versions are where a lot of the cost comes from.
Thomas: So I might pay $100 a month for a tool, but you're paying much more?
David: Absolutely. There's one tool I pay $1,500 a month for.
Thomas: That's just like an HVAC company needing a truck. The truck costs money because it's necessary to do the work.
David: Exactly.
But even with all the tools, experience is still the biggest differentiator. Every recruiter has access to similar technology if they're willing to pay for it. What matters is how you use it.
Once you've identified your target candidates, the message you send becomes incredibly important. It has to be short. It has to grab their attention. They're probably reading it on their phone. You also can't mention the client's name, or they'll simply go apply directly. The goal is to get the candidate to respond so you can start a conversation.
Thomas: How do you keep a company from telling you they didn't hire someone, then hiring them behind your back so they don't have to pay your fee?
David: That's covered in the agreement.
But honestly, if we're having to pull out the contract and have that conversation, something is already wrong. That relationship probably isn't going to last anyway. One thing I like about my business is there's not a tremendous amount of risk beyond losing a client.
If that happened, obviously I couldn't work with that client again. But it's not some huge financial loss that puts my business in jeopardy.
Thomas: A big part of your business is me coming back to you over and over, and me referring my friends to you. If I'm unethical, you probably don't want me as a client anyway.
David: Exactly.
It's very easy for me to say, "Okay, we're done." If someone doesn't have a good experience with me, they're not going to call me again.
Likewise, if a client handles things unethically, I don't need to continue that relationship.
It goes both ways.
Thomas: What's the biggest mistake you see recruiters make?
David: Not screening candidates properly.
I've made bad submittals before too, so I'm not pretending I've never done it. But a lot of recruiters get excited because they finally have someone to submit. They rush to send the resume without stopping to ask whether this person is actually going to represent them well and be a good fit for everyone involved. Sometimes they're chasing metrics. "I've got to submit ten candidates this week." Instead of slowing down and making sure it's the right submission, they're trying to hit a number. That's one of the biggest mistakes recruiters make.
Thomas: How are you doing things differently now than you did at a large staffing company?
David: I do all of the recruiting myself.
I have people who help bring in business, but every search comes through me. That's important because, in many large staffing companies, recruiting is the training ground. New recruiters come in, learn the business, and once they get good, they move into sales. That creates a constant cycle where junior and mid-level recruiters are handling most of the recruiting work. The senior recruiters are usually working on the highest-profile or most profitable searches. But recruiting is the most important service a staffing company provides.
Thomas: They're the people actually finding candidates for me.
David: Exactly. The salesperson is the one who takes you to lunch and brings in the business. But once they leave your office, they're handing your search over to the recruiting team. The quality of that recruiting team is what determines whether you're going to get great candidates. The staffing companies with the best recruiters are the ones that win in the long run.
Thomas: Let me make sure I understand. A salesperson brings in the client. Then the recruiter does the work of finding the executive chef, accountant, salesperson, social media manager—whatever role needs to be filled.
David: Correct. The salesperson manages the relationship. The recruiter finds the talent.
Thomas: So in large staffing companies, when recruiters get really good, they often move into sales?
David: Correct. Not every company, but that's a common model. The challenge is that it leaves many recruiting teams in a constant state of junior-to-mid-level experience. That's the downside, in my opinion.
Thomas: Before I even post a job, what's the first question every owner should ask themselves?
David: Is there anyone internally who can fill this role?
In most cases—especially for management or senior-level positions—the answer should at least be considered. If you've got someone who's been on the team for years and you hire an outside manager over them, they're naturally going to wonder, "Why wasn't I considered?" Sometimes bringing in an outside leader is absolutely the right move. But before you do, ask yourself if someone on your team is ready for that next opportunity.
Thomas: If it takes me 60 days to hire someone, what's that really costing me?
David: Every position in a company has value. Every single one.
It's difficult to put an exact dollar amount on it, but if a position is open, something is being impacted negatively. Projects get delayed. Work doesn't get done. There is always a cost to having an open position. The challenge is figuring out how to quantify it.
Thomas: It's hard to measure. I talk about this all the time—things like morale. You can't really measure how your staff feels about you as a leader when they're carrying extra work. People love time off. People love pay increases. If Susie quits and now Diana and Kristen have to absorb all of her responsibilities, that weighs on them.
David: Exactly. That's normal in the short term. Everyone expects to pick up the slack while a replacement is hired. But the longer that position stays open, the more pressure it puts on the rest of the team. You need to fill that role as quickly as possible because if that goes on for six months or a year, it's not good.
Thomas: Getting a hire wrong is always a fear. What's the hidden cost of making a bad hire?
David: Every manager has made a bad hire. It happens. The goal is to minimize them.
The biggest cost goes back to the strain it puts on everyone else. You spend three to six months training someone. Your team invests time in them. Then you realize it isn't going to work. Now you have to let them go and start the entire process over again. You're already six months behind before you even begin looking for the next person. By the time you hire and train the replacement, you've probably lost close to a year. A bad hire hurts.
Thomas: You hear hiring advice everywhere these days. What's one piece of hiring advice that you think is wrong?
David: The idea that you need to find a 100% match. Some companies create these long lists of requirements and expect one person to check every box. That's expensive, and it takes time. Sometimes a 75% match is exactly what you need. That person sees the remaining 25% as an opportunity to grow. They're often more affordable because they're at the lower or middle end of your salary range. Instead of looking for A through Z, identify the three skills someone absolutely has to have. Everything else can be developed.
Thomas: Do you think someone who's an 80% match might actually work harder because they have room to grow?
David: Absolutely.
Then you can spend more time evaluating personality, energy, and whether they're someone you'll enjoy mentoring and developing instead of obsessing over every technical requirement.
Thomas: I hear this all the time. "The person I'm looking for isn't applying to my job." What's the biggest reason the best talent never applies?
David: Years ago, everyone was posting resumes on sites like CareerBuilder and Monster. That was how people looked for jobs.
Today, the best employees usually aren't looking. They've been with their company for two, five, maybe ten years. They're doing good work. They're paid well. They're happy. But if you put the right opportunity in front of them—with the right message and the right compensation—they'll usually respond and at least have a conversation.
Thomas: But if they're not looking for a job, how do you find them?
David: That's where the tools come in.
I have the websites, licenses, and recruiting platforms that help identify those candidates. If someone doesn't have any digital presence, they're very difficult to find. Otherwise, your only option would be to walk into a restaurant and ask to speak to the head chef. They have to exist somewhere digitally.
Thomas: You recruit across multiple industries. What's one hiring tactic you've used successfully across completely different industries?
David: There are a lot of different ways to search for candidates. You can search by skills, job titles, industries, or any number of other criteria. After 25 years, you learn what works and what doesn't. But it's really less about the search itself and more about the message you're sending.
Are you targeting the right people? Can you build a relationship with them? Can you get referrals?
Those principles work across every industry. Whether it's IT, healthcare, software, or anything else, people are people. Everyone wants to grow in their career. The key is finding them and putting the right opportunity in front of them.
Thomas: You've hired everyone from chefs to IT professionals to accountants. Which industry are you most confident recruiting for?
David: IT.
I got my degree in IT from Alabama, and when I started recruiting, I worked exclusively in IT for about 15 years. Since then, I've expanded into engineering, finance, sales, marketing, and a lot of other areas. At one point, I even managed a team of lawyers.
Thomas: Give me some examples of IT roles you recruit for.
David: Software developers, network engineers, quality assurance professionals—really any type of IT position. One advantage of having experience in IT is that I know how to ask technical questions. I can usually tell pretty quickly whether someone actually knows what they're talking about. A newer recruiter may be reading from a script, but experience helps you understand the answers you're hearing.
Thomas: Is there something candidates say or do that immediately gives you a green flag?
David: The biggest thing is how they communicate.
Do they let me finish my question? Do they answer with enough context? Can they explain what they've done without talking for fifteen minutes?
If someone talks nonstop and never lets me ask another question, that's a red flag. If every answer is just "Yes" or "I've done that," that's a red flag too because I have to dig for every detail. Good communication is one of the strongest indicators I look for.
Thomas: How can leaders keep their best people when recruiters are constantly reaching out to them?
David: First, understand that recruiters are contacting your employees every single day. That's just the reality. The best talent gets recruited.
The key is creating opportunities for people to grow inside your company. You don't want five software developers with ten years of experience all competing for one management position. A healthier structure is to have senior people, mid-level people, and junior people learning from them. That way there's a natural progression when someone gets promoted. If everyone is at the same level, somebody is eventually going to leave because they'll realize there's nowhere for them to go.
Thomas: Is it difficult knowing what someone makes after you've placed them, then seeing another company offering them $15,000 or $20,000 more?
Is it hard not to recruit them away?
David: No.
Rule number one in recruiting is you do not recruit from your own clients. Ever. If you're doing that, shame on you. Your relationship with the client is far more important than one placement fee. You don't cross that line.
Thomas: Because eventually I'd find out.
David: Exactly. You're more important to me than a single placement. Every client should be.
Thomas: "Culture fit" is one of the biggest buzzwords today. Is it just a polite way of hiring people who are like you?
David: That's a tough question. I've seen companies where culture fit is incredibly important because people who fit the culture stay for a long time. I've also seen situations where it's worth bringing in someone completely different. I always think about the story of NASA hiring the engineer with the mohawk. Everyone else was dressed the same, thinking the same, and then here's this guy who looked completely different.
They took a chance on him. Sometimes that's exactly what a team needs.
If ideas have become stagnant and everyone is thinking the same way, bringing in someone with a different perspective can be incredibly valuable. There are times when it's worth going against the traditional culture fit.
At R3cruit, we’re dedicated to simplifying and elevating the recruitment process, connecting companies with top-tier talent to drive success and growth, ensuring quality hires for all.
