How to Choose an Executive Search Firm: A Guide for Founders, CEOs and Boards

To choose an executive search firm, judge the individual who will run your search, not the brand on the proposal. Pick a retained firm with real depth in your sector, confirm in writing which companies it cannot recruit from, and make sure the partner who pitches is the person doing the calls. Then test the firm with specific questions before you sign, because the contract decides most of what follows.

That is the short answer. The rest of this guide is for founders, CEOs and boards hiring senior leaders in capital markets, digital assets, fintech and AI infrastructure, where the candidate pool is small, the regulatory stakes are high and a generic search process tends to fail quietly.

What is the difference between retained and contingency executive search?

The difference is how the firm gets paid, and that shapes how it behaves.

• Retained search: you engage one firm exclusively and pay in instalments as the search progresses, whether or not you hire. The firm is paid to run a full market map and process.
• Contingency search: you pay only if you hire a candidate the recruiter introduced. Several agencies may work the same role at once, and the first credible CV often wins.

Contingency works well for volume or mid-level roles where speed matters more than coverage. For a CEO, CFO, CTO, Chief Compliance Officer or Head of Trading, retained is usually the right model. A contingency recruiter is rewarded for placing someone, quickly. A retained firm, at least in theory, is paid to find the right person and to tell you uncomfortable things along the way, such as that your compensation is below market or that your brief describes two different jobs.

How much do executive search firms charge?

Fees are almost always a percentage of the hire's first-year compensation. The useful reference points are public:

• Korn Ferry's fiscal 2025 annual report (Form 10-K) states that its search fees are generally one-third of the placed candidate's estimated first-year cash compensation, plus a percentage of the fee for indirect expenses, with an additional "uptick" fee billed if the final package exceeds the estimate.
• SHRM puts the standard retained fee at about 33% of salary, bonus and signing bonus, and contingency fees at 20% to 25% of first-year cash compensation.
• Retained fees are typically paid in three instalments: one at the start, one at an agreed milestone and one on completion, as Indeed's employer guide describes.

• Typical fee: Retained search: About one-third of first-year cash compensation. Contingency search: About 20% to 25% of first-year cash compensation.
• When you pay: Retained search: In instalments, regardless of outcome. Contingency search: Only on a successful hire.
• Exclusivity: Retained search: One firm. Contingency search: Often several agencies.
• Best suited to: Retained search: C-suite, board and hard-to-fill senior roles. Contingency search: Mid-level and higher-volume roles.
• Main risk: Retained search: Paying for a search that is delegated or under-resourced. Contingency search: Speed over fit; CVs sent to multiple clients.

These are reference points, not fixed rates. Fees vary by firm, role and jurisdiction, and everything is negotiable. In digital assets and AI infrastructure, check exactly what "compensation" means in the contract. Packages in these sectors often include equity, tokens or large variable components. Agree in writing whether the fee applies to base and target bonus only, or to equity and token grants as well, and how any uptick is calculated. Our compensation guide is a useful starting point for setting a realistic package before you brief anyone.

Should you use a boutique or a large executive search firm?

Large global firms bring brand recognition, broad coverage and the reassurance a board may want. Specialist boutiques bring narrower but deeper networks, and usually more senior attention per search. Neither is automatically better. The question is which one can actually reach the people you need.

Two structural factors tend to decide it in niche markets:

• Off-limits restrictions. The bigger a firm's client list, the more companies it has agreed not to recruit from. Korn Ferry's own 10-K lists off-limit agreements as a risk to its business and notes that specialty firms with smaller client bases are subject to fewer of them. If the best candidates for your role sit inside a large firm's existing clients, that firm cannot approach them.
• Who does the work. Large firms often pair a senior partner with associates and researchers. That can work well, or it can mean the person you met at the pitch is barely involved after week two.

For a market infrastructure business, the target list for a Chief Risk Officer or Head of Market Structure may be only a few dozen people across a handful of exchanges, clearing houses, market makers and banks. In that situation, the firm's blocked companies and its personal relationships matter far more than its office count.

Who actually runs the search?

This is the question boards most often forget to ask, and the one that most often explains a failed search.

The AESC Client Bill of Rights says clients are entitled to a designated lead advisor, and the AESC's professional practice standards say the written agreement should name the lead advisor serving the client. Go further than a name on the cover page. Ask:

• Who will make the first approach to candidates? A cold message from a junior researcher lands very differently with a sitting exchange CEO than a call from someone they already know.
• Who will conduct the first-round interviews and write the assessments you read?
• How many live searches is the lead running right now?
• What happens if the lead leaves the firm mid-search?

There is an uncomfortable dynamic here. A recognisable firm can be chosen partly because it protects the people who chose it: if the hire fails, the process looked defensible. That is a governance problem, not a hiring strategy. Sam explores it in more depth in his newsletter issue on why boards buy cover rather than outcomes.

What does "off-limits" mean in executive search, and why does it matter?

"Off-limits" (sometimes called "blockages" or "hands-off") means a search firm has agreed not to recruit from a client's staff for a period of time. It protects you after you hire a firm, and it restricts the firm when it works for others.

Korn Ferry's 10-K notes that the duration and scope of these agreements, including whether they cover a client's affiliates or only certain divisions, are generally subject to negotiation or internal policy. That means two practical steps for you:

1. Ask for the blocked list before you sign. Give the firm your top 20 to 30 target companies and ask which of them it cannot approach, and for how long.
2. Negotiate your own protection. Define how long your company is off-limits to the firm after the search ends, and whether it covers your whole group or just the hiring entity.

Conflicts go beyond off-limits. Is the firm currently running a similar search for a direct competitor? Is it representing a candidate it also intends to put forward elsewhere? The AESC standards expect members to disclose potential conflicts and resolve them with the client, including through a client waiver where appropriate. A good firm raises these issues before you ask.

How do you judge sector depth in digital assets and market infrastructure?

Every firm says it specialises. The test is whether it can talk about your hire in the language of your business, and whether its network reaches beyond people who are already looking.

Practical signals:

• Regulatory fluency. In the UK, Senior Management Function holders need FCA or PRA approval before starting their roles, which affects timelines and who is realistically hireable. In the EU, MiCA has been fully applicable since 30 December 2024. In Dubai, VARA's rulebook requires a licensed virtual asset service provider's Compliance Officer to have at least five years of relevant compliance experience, be UAE-resident or a UAE passport holder, and be approved as fit and proper. A firm with real depth raises these constraints in the first meeting, not after a candidate fails them.
• Role literacy. Can the consultant explain what separates a Head of Trading at a crypto-native venue from one at a traditional exchange, or a GPU infrastructure CTO from a SaaS CTO? Vague answers mean a keyword search, not a network.
• Market map, not a longlist. Ask what the target universe looks like and how many people are realistically in it. Specialists can usually sketch it in the first conversation.
• Candidate-side reputation. Ask senior people in your sector which search consultants they actually take calls from. In small markets, reputation travels fast in both directions.
• Assessment depth. Who on their side can probe a candidate's real technical or regulatory knowledge? Strong candidates notice quickly when nobody in the process can.

Spearpoint's specialisms reflect where we think depth matters most: digital assets and crypto, exchanges and venues, market makers and prop trading, fintech and payments and AI infrastructure.

What questions should you ask an executive search firm before signing?

1. Who exactly will lead the search, make candidate approaches and run first interviews?
2. Which of our target companies are off-limits to you, and for how long?
3. Are you running, or have you recently run, a similar search for a competitor?
4. What similar roles have you completed in the last two years, and can we speak to those clients?
5. How is the fee calculated, what counts as compensation (including equity and tokens), and when is each instalment due?
6. What happens if the hire leaves early? What is the replacement or guarantee term?
7. How often will we get progress updates, and what will they contain?
8. What would make you tell us the search is unlikely to succeed as briefed?
9. When have you walked away from a search, and why?

The last two questions reveal the most. A firm that has never told a client its compensation is wrong, or never declined an assignment, is a firm that optimises for signing mandates.

What are the red flags when choosing a search firm?

• The pitch is all brand and no named team.
• Candidate names appear in the pitch, before anyone has understood the role. That usually means recycled CVs.
• The firm agrees with every assumption in your brief, including the compensation.
• No clear answer on off-limits, or a refusal to check your target list.
• Promises of a shortlist within days for a senior specialist role.
• No questions about your board, investors, culture or why the last person in the role left.
• Reluctance to put the lead advisor, fee basis and guarantee terms in writing.

What does a good executive search process and timeline look like?

Timelines depend on the role, the market and how quickly you make decisions. Regulated roles can take longer, because regulatory approval and notice periods sit on top of the search itself. A well-run retained search usually follows this shape:

1. Brief and calibration. The lead consultant interviews the founder, key executives and relevant board members, then challenges the brief. You agree the scorecard, the compensation range and what success looks like at 12 and 24 months before any outreach starts.
2. Market mapping. The firm maps the full target universe, including people who are not looking, and checks it against off-limits restrictions.
3. Approach and qualification. Senior, personal outreach. You receive regular reports on market response, not just names.
4. Shortlist. A small number of assessed candidates with candid write-ups, including the risks.
5. Client interviews. A structured process with interviewers whose depth matches the candidates'. Senior candidates assess you as much as you assess them, and a weak interview panel loses strong people.
6. Referencing, offer and resignation. Deep references, a well-managed offer and support through counter-offers and notice periods.
7. Onboarding. The AESC Client Bill of Rights includes support with onboarding and integration after the offer. Ask how the firm stays involved once the hire starts.

The commonest cause of a slow search is not the firm. It is a client that has not agreed the brief, the package or who makes the final decision. Settle those before you engage anyone.

How to choose an executive search firm: a summary

• Use retained search for senior, high-consequence roles, and understand exactly how the fee is calculated.
• Choose the person, not the brand. Get the lead advisor named in the contract.
• Check off-limits against your own target list before you sign.
• Test sector depth with specific questions about regulation, role differences and the size of the target market.
• Prefer a firm that challenges your brief and will walk away if the search cannot succeed.

That last point is central to how we work at Spearpoint. We are a retained search firm for market infrastructure and capital markets, with offices in London and Dubai, and we are incentivised to be right rather than simply to place. If you are planning a senior hire, you can read more about how we work with clients.

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Frequently asked questions

Is retained or contingency search better for executive roles?

For C-suite, board and hard-to-fill senior roles, retained search is usually the better choice. You engage one firm exclusively and pay in instalments, so it is paid to map the whole market and run a full process rather than to send the first plausible CV. Contingency search, where you pay only on a hire, suits mid-level or higher-volume roles where speed matters more than full market coverage.

How much does an executive search firm cost?

Retained executive search fees are typically about one-third of the hire's first-year cash compensation, usually paid in three instalments. Korn Ferry's annual report describes this one-third model, plus an expense charge and an uptick if the final package exceeds the estimate. SHRM puts contingency fees at 20% to 25% of first-year cash compensation. Rates vary by firm, role and jurisdiction, and are negotiable.

What does off-limits mean in executive search?

Off-limits means a search firm has agreed not to recruit staff from a client for a set period. It protects you once you hire a firm, but it also limits where that firm can look when working for others. Large firms with long client lists have more of these restrictions, so ask any firm to check your target company list against its blocked clients before you sign.

What should I ask an executive search firm before signing?

Ask who will lead the search and personally approach candidates, which of your target companies are off-limits, whether the firm is working for a competitor, and how the fee is calculated, including whether equity or tokens count as compensation. Ask about guarantee terms and reporting. Finally, ask when the firm last told a client its brief or package was wrong, or walked away from a search.

How long does an executive search take?

It depends on the role, the size of the candidate market and how quickly the client makes decisions. Senior searches move through briefing, market mapping, outreach, shortlist, interviews, referencing and offer, and notice periods come on top. Regulated roles can take longer because some, such as UK Senior Management Functions, need regulatory approval before the person can start.

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