We all have a Hidden Head-Hunter (H3) in us. That is the premise of H3, a new employee referral service company.

This online referral concept is simple. You are hiring and ready to pay a referral bonus. You send me the position information using H3’s social networking technology that works like LinkedIn. If I refer you a candidate that you hire, you owe me the bonus. If I refer it to a friend in my network that finds the person, we share the amount! And H3 gets 10% on top.

What is a simple idea for this new startup that’s still in beta can possibly save a fair amount of agency costs. What are the other benefits for a small company to use H3? You are not bothered to pay each person individually. They do all the accounting for you and you pay only one bill.

Their success rate so far has been filling 10% of the positions that were posted through their network and they are targeting 33%. They targeted the SME market and with 150 customers, they seem to have made good progress. If you are a larger company and use already an employee referral system, this is a reminder that referrals are a great source of candidates.

The quote I like best (adapted from the famous JFK inauguration speech) comes from their CEO, Hans Geiskes an ex-Monster executive, and can be applied to all talent management departments when speaking to hiring managers: “Don’t ask what HR can do for you, ask what you can do for HR.”

And the answer is of course: keep those referrals coming!