Headhunters recast as high-tech talent agents

globeandmail.com By Shaun Markey – Wednesday, February 9, 2000

Ottawa — Sports superstars retain agents to negotiate contracts and represent their interests. So why not the same treatment for the new breed of tech superstars?

Alan Kearns and Doug Martin believe they’re on track to perform that service. Their 18-month-old Kanata, Ont., firm, TalentLab, represents more than 200 elite technology workers in the Ottawa area.

"We find technology stars," Mr. Kearns says. "That’s what our branding statement is. And we build relationships with them."

In their approach to headhunting, the two men are pitching themselves as budding Jerry Maguires of the high-tech world. Paul Swinwood, who runs Software Human Resources Council, a non-profit group, says he’s been expecting the agent phenomenon to hit high technology.

"There are high-end people that can command this sort of attention. In an area where there is a lack of specific skills, I can see a person with that skill making themselves available to the highest bidder," he says. "The high end of the market is going to go through the roof. It’s the top 5 per cent of people, and we have to figure out ways to keep them here."

TalentLab today has a staff of 14, 12 of whom work as agents for young, highly skilled technology workers. The firm is on track to for $4.5-million in revenue this year.

Mr. Kearns, 36, is a 10-year veteran of the search industry, and partner Mr. Martin, 30, is an electrical engineering graduate from Ontario’s University of Waterloo and a former Nortel Networks employee.

Mr. Kearns says he helped found TalentLab with the idea of creating a different kind of headhunter. The traditional recruiting process is "unpleasant and dehumanizing" for most people, he says. Recruiters who work strictly on commission, he feels, are often more concerned about their commission cheque than the client they are supposedly serving.

For many, he says, the relationship ends when a candidate is placed in a job. For that reason, TalentLab"talent scouts" are not on individual commission but share in the entire revenue stream of the company. There’s also profit sharing for everyone and, like the candidates they serve, all the headhunting employees have stock options.

TalentLab represents both technology professionals and companies searching for them — although the fees, as in most recruiting shops, are paid by the business that hires the worker. But Mr. Kearns insists the firm doesn’t just find jobs for candidates.

"We can say to a candidate at times that this isn’t a good move for you or to a client, that they shouldn’t hire a candidate because it isn’t a good fit. Why? Because it’s all about the relationship."

Marc Dufresne, 31, obtained his present position as manager with ThinWeb Technologies through TalentLab. He markets Webcrumbs, an intelligent software product that tracks Web site visitors and their activities.

Mr. Dufresne met TalentLab agent Les Banks at an industry conference. "Les handled the sticky part, the negotiations. I can negotiate million-dollar business deals, but when it comes to myself, I’m not as effective. Even my kids out-negotiate me."

Mr. Kearns points out that Michael Jordan and Wayne Gretzky never had problems finding a National Basketball Association or a National Hockey League franchise that wanted them. Still, the athletes didn’t deal directly with these teams. They hired agents to "maximize their opportunity, and that’s what I saw as our vision."

"We know ASIC [application specific integrated circuit] designers and photonics engineers and embedded software developers and Java developers were not going to have problems finding a job. Their problem is maximizing their upside; finding the right company with the right package and working with them through that process."

Taking base salary, benefits and stock options into account, typical compensation packages these days for top flight technology talent range from $80,000 to $250,000. Companies hiring a TalentLab client typically pay a fee based on a third of the first-year salary. Industry association experts see the agent trend continuing, as long as people are in such short supply.

"It will be a minimum of five more years before universities are doing all the things they need to be doing," says Dennis Senik of the Strategic Microelectronics Consortium, a group of Canadian companies developing educational programs for new microelectronics workers. "And it’s going to get worse before it gets better. I never thought it would come to this," he says.

While the Internet allows a technology candidate to deal directly with any company and, in his opinion, will make many traditional search firms obsolete, Mr. Kearns feels his company will flourish because it adds value to the negotiation process.

"People change jobs every two to three years, but they aren’t necessarily good negotiators. Or they may not know that they’re $5,000 under the market or that they should have got 5,000 options rather than 3,000. They often find out afterward, and the difference is because one individual was a better negotiator than the other."