Hiring is difficult for most businesses, particularly so in an industry such as technology in which finding talent can be time consuming and expensive. Since time is precious for most startups, executive recruiters can be appealing. Tech recruiters often have their finger on the pulse of a community and can take over the onerous task of sorting through an endless pile of resumes. However, for many reasons it's really important to resist temptation. Not only are headhunters expensive, but also they rarely work out.
They don't know the values of your company
One problem with outsourcing hiring is that recruiters may not necessarily understand your company values. In my experience, attitude and the will to succeed are a far bigger predictor of an employee's success than anything that's written on someone's resume. Values matter, they keep everyone on the same page and help employees up and down the ladder understand what they're contributing to the big picture. Headhunters who come from outside the company aren't going to understand your values. Talented though they may be, they've never worked for you, they don't know what it's like to be an employee at your company. Current employees understand your culture, they've lived it. They're the ones who will be able to find you superstars.
They don't take the long view
If you want to retain talent, then you have to think about the career trajectories of your new employee. Are they likely to reach their career goals, and are you doing everything you can to place a context around their contribution and performance? Headhunters don't usually think about placements in that way. Speaking broadly, they earn their commission whether their referral works for you for six months or six years. Headhunters are incentivized to produce commissions, which can prevent them from taking the long view. It's far more cost-effective to focus on developing the talent that you have in-house rather than seeking an outside talent. If people trust their managers to help them advance their careers, then it will breed ambition, loyalty, and resolve.
They promote insularity
It may seem counter-intuitive, but the reliance on outsiders to recruit executives leads to insularity. They typically rely on dated networks, and often refer the same people to many clients at once based on availability. Headhunters can also have a trickle-down effect on the entire industry. It's safe to assume that a CEO or a CMO will have people, reporters, and agencies that they enjoy working with and will want to continue working with in the future. This is why so many of the best technology jobs often get passed between the same few people. Personal referrals can cause insularity as well, but your own people are likely to have better grasp of what's missing ingredients within your team.
The best talent knows where they want to be
The last and most powerful reason that I never use headhunters is that the best talent often don't use recruiters either. Truly motivated and ambitious people know where they want to be. They have their finger on the pulse of the tech community, and know where the best opportunities lie. Even better, they usually have problems that they are passionate about solving, and are committed to finding a place and a role that will let them channel those passions. There are naturally situations where everyone's interests align, but they are rare. It's better to rely on your own judgement.
Deep down, a big part of my personal aversion to headhunters comes from the belief that it's better to rely on your own people when searching for talent. The best employees have very steep learning curves, and are going to be capable of much more than the job you hired them for once they've been trained and gotten a feel for the environment. Rather than hiring an expensive headhunter to fill the gaps, use mentorship and career development to help your younger employees rise to the occasion.