Executive Summary – Contingency Search Firms

The Pacesetter – DNA Search Inc.

For the 15 top contingency search firms in L.A. County, 2001 was not a good year. Eleven of the 15 saw revenues decline or stagnate as the economic downturn hit the recruitment business.

Although revenues fell 16.6 percent in 2001, to $6.5 million, Encino-based DNA Search Inc. once again placed at the top of the list of largest contingency search firms in Los Angeles County.

Meanwhile, newcomer Scott-Thaler Associates captured the number three spot with $5.8 million in revenues, while Kforce climbed one place to second even as the company took in $1.2 million less in 2001 compared to 2000. Search West Inc. fell from sixth to 13th position as revenue declined nearly 50 percent, to $2.5 million.

Unlike retained executive search firms, which are paid whether or not the position is filled, contingency search firms receive compensation only if a particular search is successful. Salary for employees successfully placed with companies starts around $40,000.

Jeremiah Marquez

The Pacesetter

DNA Search Inc. of Encino retained its No. 1 ranking on the list of top 15 contingency search firms in 2001, but it was a difficult year.

Revenues declined 16.6 percent, to $6.5 million from $7.8 million in 2000. The decline followed a 34.6 percent increase in 2000 from $5.1 million the year before. During 2001, the search firm also lost eight local recruiters, ending the year at 32 instead of 40 in 2000.

CEO Daniel Levy said the dot-com fallout contributed much to the declines in revenues and recruiters. DNA Search, founded in 1991, places executives in the areas of law, high tech, health care, biotech, telecommunications and information systems.

“Last year was a very, very difficult year,” Levy said. “We had a fairly sizeable high-tech division and because of the slow-down in high tech, a number of our recruiters just left the firm. They no longer were interested in recruiting. Their personal income dropped dramatically, and they could not turn themselves around from doing really well to managing to make placements.”

Placements were off 20 to 25 percent during 2001, Levy said. He estimated that the firm placed about 400 executives in 2001, down from 500 the year before.

Because of the tech slowdown, Levy said the firm has been focusing on placing individuals in the health-care and biotech fields. Those areas are not new to DNA Search, but they are consistently profitable, he said.

Amanda Bronstad