The search fee is the number most CEOs see. It is rarely the largest cost. Here is the full picture — retained fees, cost-of-vacancy, and the total organizational investment of getting a VP or C-suite search right versus wrong.
Retained executive search fees run 25–33% of first-year total compensation. For a VP at $280K OTE that is $70K–$92K. For a C-suite role at $450K total comp, $112K–$148K. These fees are almost always dwarfed by the cost of a prolonged vacancy or a failed hire — which runs 3–5× annual compensation by the time severance, re-search, and lost productivity are accounted for.
Most executive hiring cost conversations focus on the search fee. That framing misses 70–80% of the actual cost. The fee is a fixed, knowable number. The vacancy cost and failure cost are variable, compounding, and largely invisible until they become too large to ignore.
Retained search fees are percentage-based. Compensation packages increase with company size and stage, which means fee amounts scale accordingly. The percentage remains relatively constant; the absolute number grows.
Compensation ranges reflect 2026 market data for US-based VP and C-suite roles. Total comp includes base salary and target annual bonus; equity is excluded from fee calculation basis. Retained fee percentages reflect industry standard range for mid-market retained search; Majhi Group operates at 20–25%.
The search fee is one component. The full cost of an executive hiring decision includes the cost of vacancy during the search, and the expected value of failure risk. All three must be considered together.
| Role | Search Fee | Vacancy Cost / Month | Cost of Failed Hire | Total Risk Exposure |
|---|---|---|---|---|
| VP Sales Series B, $280K OTE |
$70–$84K | $60–$120K | $500–$840K | $630K–$1M+ |
| VP Marketing Series C, $320K OTE |
$80–$96K | $40–$80K | $480K–$960K | $600K–$1.1M |
| VP Engineering / CTO Series C, $420K total comp |
$105–$140K | $80–$160K | $630K–$1.26M | $815K–$1.56M |
| CFO Pre-IPO, $500K total comp |
$125–$165K | $100–$200K | $750K–$1.5M | $975K–$1.87M |
| CEO Enterprise, $800K total comp |
$200–$265K | $200K–$400K+ | $1.2M–$4M+ | $1.6M–$4.7M+ |
Vacancy cost estimates based on revenue impact, management overhead, and team drift for revenue-critical roles. Failure cost range reflects 3–5× annual comp framework from executive transition research. Total risk exposure = fee + (vacancy cost × avg search duration in months) + (failure cost × 40% failure rate).
When a VP Sales seat is empty for 90 days, the cost does not appear on a single invoice. It shows up as pipeline that didn't get built, deals that closed late, a sales team that lost direction, and ramp time that compounds after the hire. By the time these costs are visible, they have already been incurred.
The same dynamic applies to every revenue-critical or team-critical seat. A CTO vacancy delays product decisions. A CFO vacancy slows fundraising timelines. A VP Marketing vacancy creates brand drift. None of these appear as a line item — which is exactly why organizations systematically underestimate them.
The question is not "how much does the search cost?" The right question is: what does the vacancy cost per month, and how many months will a poor process add to the timeline? Every additional month of vacancy at a VP Sales role costs more than the search fee itself.
A 90-day search at this cost = $285K–$465K in vacancy cost alone. More than 3× the search fee.
Cutting 45 days off a VP Sales search at a $10M ARR company saves $142K–$232K in vacancy cost. At a 25% search fee on $280K OTE, the Majhi Group fee is $70K. The fee does not cost money. A slow search does.
Every CEO I speak with knows the search fee. Very few have calculated their monthly vacancy cost, or factored the 40% failure rate into the expected value of their hiring decision. When you do the math, the economics of retained search become obvious — not as a premium, but as a risk-reduction strategy.
Majhi Group operates at 20–25% of first-year total compensation. That sits at the lower end of the retained search market. The compression we deliver — 30–45 days versus a 90-day industry median — means the vacancy cost savings alone often exceed the fee. The 90-day replacement guarantee removes the tail risk of a failed hire at no additional cost.
Data-driven reference for CEOs and founders navigating VP and C-suite hiring.
In 20 minutes we can tell you the expected vacancy cost of your open mandate, the risk profile of your current search approach, and what a faster close is actually worth in dollar terms.