Purpose built platform to find contracts

[JacobMason]

And how will you call your employees in the extremely unlikely event if you were successful?
Staff maybe?

No matter how you twist and turn you're either an agency or you have no business model

There would be very few employees.

We're an agency, we're not denying that.

[Lance]

There would be very few employees.

We're an agency, we're not denying that.

so you're USP is that you're an agency with no recruiters?

[JacobMason]

so you're USP is that you're an agency with no recruiters?

Put bluntly, yes. But I don't see that as a bad thing.

Instead we have a platform.

[b0redom]

But what's the point of a platform? If you're assuming clients will come direct to you with requirements, why?

If they're savvy enough/looking to save money, they'll go direct to LinkedIn/Jobserve and do it themselves.
If they're clueless and/or can't be bothered they'll go via an agency. Probably the one who's wined and dined their purchasing dept/hiring manager the best.

Contractors don't like going via agencies (as a rule), but the reason we have to is that they have the work. If you don't have the work, your website can be as slick and shiny as an estate agent's haircut, but you still won't gain any traction.....

[LondonManc]

Ex-contractor here so no vested interest.

Your offering:
A recruitment agency without the agents but with all the other processes and functionality, such as:
Website, with searchable vacancies for candidates & website, with searchable candidate database for clients? (Both risk clients/candidates/other agencies rinsing you in various ways)
Invoicing pass through - you act as an admin function to collate invoices and signed timesheets from the candidates and pass the invoices plus your percentage (5-8% presumably) on to the client.
Lower margins to clients because there's no package to pay recruiters

You'll need as a starter:
Company incorporation
Accountant
Lawyer to sort your contracts out (including IR35 scenarios)
Insurance

The big issue I see for a start-up agency is invoice factoring - clients pay 56/90 day lead time, candidates expect weekly or monthly upon completion of signed timesheet and invoice. In your case, I'd say that you'd have to pay weekly to mitigate the candidate's risk of you collapsing give your lack of (credit) history.
As an example on rolling the numbers up:
Let's say you do well, engaging 20 contractors at an average of £500 per day for 20 days each month from the start of 2020 all on six month contracts (fantasy island, but it's an illustration of where you want to be). That's £50,000 per week + VAT that you'll have to pay out from the second week of January and you won't see any money until either the end of February or the end of March, depending upon the terms of your supplier agreement with the client. Let's say 90 days because those are the terms that three different agencies have told me about. Before you have a single pound come through the door, you'd have paid out to clients £1,080,000. That's not all though. If you invoice monthly to clients, which is typical, you'd then have £256,800 (assuming average 7% commission) arrive in your account from January. Then you'd have to pay out £240,000 over the course of the next month. You'll have to be going for several years before you get the base costs back for your margin to catch up with your factoring costs. Based on those 20 contractors, your margin would be c.£50k per annum. Less costs, salaries, etc, you'd really need to be ramping up to about 100 contractors to make it worth while.

[tomtomagain]

Instead we have a platform.

You are trying to play match-maker and with the aim of skimming a small %age from each job. Great, just sit there and watch the money roll in whilst your users do all the work.

That's a difficult trick to pull off.

You have two major hurdles.

1) Nobody with a contract to be fulfilled has heard of you or cares about your platform.
2) Nobody who can do the contract has heard of you or cares about your platform.

You'll need to spend heavily to attract both audiences. Without high quality contracts AND high quality contractors the idea is dead in the water and it wouldn't matter how pretty the platform is.

There have been dozens of failed attempts to do what you are thinking about. Here's another one : Toptal - Hire Freelance Talent from the Top 3% currently advertising very heavily on LinkedIn

[Cirrus]

I must be thicker than I thought

As an IT contractor, I am not a fan of the process to acquire new contracts. I hate having to go through recruiters and searching job sites to apply for contracts that I know are just recruiters phishing for contacts.

That's how we came up with Contracta, the idea is to be a one-stop-shop for contracting. You apply to contracts, receive and sign the paperwork, track your time and get paid all in one place.

You don't like recruitment agencies so you came up with a new idea: a recruitment agency.

If you want to start up an agency, then as long as you have jobs you can offer, contractors will come. The challenge is how you are going to get jobs? Recruiters live a torrid life, totally devoid of basic human rights. They are constantly trying to find out who has a job to peddle, and then somehow prise that customer any from their normal supplier. You can make a lot of money but, as is so often the case in life, it's not doing the business that is difficult. It's getting the business that's the hard part. What would you say to a potential client to get them to work with you? (Perhaps you're thinking "I'm cheaper" but for the life of me I can't see anything that makes you cheaper. Big agencies can supply almost all the people that are wanted, with a supporting framework of reporting, timesheeting, background checks etc etc for as little as 5-7%. How can you compete?)

[JacobMason]

You don't like recruitment agencies so you came up with a new idea: a recruitment agency.

If you want to start up an agency, then as long as you have jobs you can offer, contractors will come. The challenge is how you are going to get jobs? Recruiters live a torrid life, totally devoid of basic human rights. They are constantly trying to find out who has a job to peddle, and then somehow prise that customer any from their normal supplier. You can make a lot of money but, as is so often the case in life, it's not doing the business that is difficult. It's getting the business that's the hard part. What would you say to a potential client to get them to work with you? (Perhaps you're thinking "I'm cheaper" but for the life of me I can't see anything that makes you cheaper. Big agencies can supply almost all the people that are wanted, with a supporting framework of reporting, timesheeting, background checks etc etc for as little as 5-7%. How can you compete?)

We don't like recruiters. The idea is to operate more like indeed.

You think they only take 5-7%, maybe in very few cases. One of the benefits for end clients is that the rate is always the same and not negotiated.

[eek]

We don't like recruiters. The idea is to operate more like indeed.

You think they only take 5-7%, maybe in very few cases. One of the benefits for end clients is that the rate is always the same and not negotiated.

But the end client (your customer) does not care about the amount of money the contractor is receiving. All they care about is that something is delivered for the fee they are paying.
And the fees and your percentages are irrelevant here as the customer has an approved budget and it probably doesn't matter how much of it they spend (heck it's often the case that spending 100% of it is better than spending 90%)

So once again what are you offering that means the customer is willing to change how they recruit contractors.

Finally do you actually understand what indeed is - it's just a advert board which gets some companies posting adverts - jobserve is little different just slightly more specialised.

[JacobMason]

But the end client (your customer) does not care about the amount of money the contractor is receiving. All they care about is that something is delivered for the fee they are paying.
And the fees and your percentages are irrelevant here as the customer has an approved budget and it probably doesn't matter how much of it they spend (heck it's often the case that spending 100% of it is better than spending 90%)

So once again what are you offering that means the customer is willing to change how they recruit contractors.

Finally do you actually understand what indeed is - it's just a advert board which gets some companies posting adverts - jobserve is little different just slightly more specialised.

I think that's a bit of a generalisation. I've worked with multiple clients who cared about the overall cost.

I do, I used it as an example of an advert board.