March 4, 2022 – Starfish Partners has been launched as an ownership/investment platform for the executive search market. The platform, according to its founder, was formed to allow owners to scale and monetize their business value; it will also allow independent search firm owners to participate and share in the equity of an entire family of companies, not just their own. “As the search and staffing industry has evolved, it has consolidated in most areas,” said Jeff Kaye, co-CEO of Kaye/Bassman International. “We see small staffing firms acquired by regional players acquired by national ones. We see giant holding companies owning a variety of organizations operating under many unique brands. We see mergers on both small and large scales,” he said.
“The executive search industry has had a flurry of merger and acquisition activities over the years, but there is one segment of this massive world that has remained relatively untouched: the world of niche professional and mid-upper-level management search specialists,” Mr. Kaye said. “The barriers to entry are low, but the obstacles to growth are significant. There are understandable issues and reasons why investors have avoided this robust section of the market,” he noted.
In 2012, Mr. Kaye led the acquisition of Sanford Rose Associates, where he helped grow the number of its offices by over 250 percent while growing the network revenues by over 1,500 percent in less than a decade, according to company data. Mr. Kaye is also a founder of Next Level Exchange, a training solutions firm.
“To do what has never been done before will require the right vision, proper leadership, a track record of success, and a solid infrastructure,” said Karen Schmidt, a board member for Sanford Rose. “But most of all, it requires the right people. For 30 years, our team has been preparing to serve our industry in a way no one has done before. Scaling Kaye/Bassman allowed us to develop the leadership team needed to support a singular organization. Next Level allowed us to expand that team and build a reputation in the industry rooted in delivery and integrity. Sanford Rose Associates allowed us to create the infrastructure – both the infrastructure to support the organic growth of our offices and the infrastructure to scale by acquisition. And now, the formation of Starfish Partners allows us to serve our clients to an even higher degree.”
Starfish Partner has already made its first acquisition: Full Spectrum Staffing Solutions, a long-time client of Next Level Exchange founded by Maxwell McNamara. “I founded Full Spectrum in 2016 and though we experienced steady growth until 2019, Full Spectrum joined Sanford Rose Associates and we have worked together to evolve the firm from the typical rainmaker model to a decentralized, scalable, data-centric organization that is poised to scale,” Mr. McNamara said.
Bullhorn, a provider of software to recruiting firms, has launched Bullhorn Ventures, a dedicated corporate venture capital resource that will invest in and partner with high-potential, early-stage companies focused on helping staffing and recruiting firms improve operational efficiency and boost top-line growth. Bullhorn Ventures will launch initially with $20 million allocated for investments.
The recruiting industry is going through unprecedented change as employment bounces back from lows during the pandemic. Search firms are challenged by the growth of online talent platforms, rising expectations from talent set by the consumer digital experience, and market growth, which has put a premium on talent acquisition. “Bullhorn has long been a technology innovator for the staffing industry and will continue to advance and innovate on the Bullhorn platform to help customers solve their most pressing challenges,” the company said. “In addition, Bullhorn Ventures will look to invest in startups that uniquely address these challenges and others, helping firms navigate and grow in the current environment.”
“The acquisition by Starfish Partners allows us to invest back in the firm at an accelerated rate, providing resources that otherwise wouldn’t have been possible without the collective,” he said. “But my most important ‘why’ of all? The people. Starfish Partners will allow us to attract more talent, provide an exceptional value proposition for our recruiters, and create unparalleled career opportunities for all,” he noted.
Also on the board of directors of the new enterprise are Nicholas Turner representing Kaye/Bassman International and Darren McDougal representing Next Level Exchange. The board of Starfish Partners will identify partners looking to monetize some of the value of their firms, take on strategic advisors, and perhaps capital to ignite their business growth. “With the combination of cash for the owner, investment capital in the business, and equity in the overall enterprise of Starfish Partners, this is a unique opportunity that is designed to transform our industry for those who are capable, successful, eager, willing, and hungry to grow,” Mr. Kaye said.
Contributed by Scott A. Scanlon, Editor-in-Chief; Dale M. Zupsansky, Managing Editor; and Stephen Sawicki, Managing Editor – Hunt Scanlon Media