Vinod Khosla, noted venture capitalist and co-founder of Sun Microsystems, says that he spends about one third of his time on interviewing and hiring people (here’s more info on Khosla’s approach). That’s a lot—because it’s that important!
- The types of people to hire
- How to find the right early hires
- How to get the team right from the beginning.
The Types of People to Hire
Rachleff’s corollary of startup success, as quoted by Marc Andreessen, states that “The only thing that matters [for a startup] is getting to product / market fit.” Your first goal is to build a team that’s capable of convincing a large and growing market of customers to use your product. This means that marketing and development are your two key initiatives at first.
Though every startup is different, here are three characteristics you’ll want in your teammates. These are usually more important than skills, because your “A-players” will be excellent learners.
You need people who are flexible and willing to learn. You may hire someone for specific skills, but your needs may change in a few months as you search for product market fit (and as your industry evolves underneath you). Of course, you don’t want to pull a bait-and-switch, but you also don’t want to get stuck with people who refuse to adjust to the new situation. Look for lifelong learners who are team players. If you’re hiring for a specific skill set—like a backend engineer or a UX/UI designer—make sure they’re willing to adapt to new tools and approaches.
Every member of your early team needs a “get things done, no matter what” approach to working. By definition, your startup is doing something that’s never been done before—and the deck is stacked against you—so new challenges pop up every day. You’re also going to be lacking much of the support that many people expect. No marketing or QA departments, for example. But that’s no excuse for letting deadlines slip. That’s why you want people who will work around any obstacle, overcome the lack of support, and produce meaningful results without having to come to you for direction ten times a day. This is rarely something you can teach, so make sure people have it when you hire them. At 10xU we ask candidates to work through case studies so we can get a sense for their approach.
Startup hours are unpredictable, to say the least. While your employees are unlikely to work as often as you, you’re still going to want them comfortable with a full and ever-changing schedule. One of the most important reasons behind screening for this? If you hire someone who isn’t prepared for long hours, there are two likely problems. First, they’ll start to resent your management style, and second, they’ll eventually burn out and quit. Nothing increases employee churn as quickly as pushing extra unplanned hours on people…for the next two years.
How to Find the Right Early Hires
Hiring your first 10 people is not the same as hiring your 101st to 110th employees.
Keep in mind that your first few hires dramatically affect the culture of your startup. If you don’t get along with someone, or if your co-founder doesn’t get along with someone, the relationship tends to get worse over time. Look for people who are flexible in their ability to work with others.
Also, whenever you hire someone that’s 10% better than the competition, that advantage will compound year after year—and it can be the difference between success and failure.
The reason that finding A-players can be so hard is that everyone wants to hire them.
- The first place to look is in your own network:
You can quickly vet first- and second-degree connections through either personal experience or recommendations. Your goal is to weed out people who appear great on paper, but who won’t perform well on your team. Beware of people who excel at big companies joining your scrappy startup team—they may need a ton of support in order to deliver the results you’re expecting.
- It’s a lot easier to get on a potential hire’s radar when you either know them or can be introduced by a mutual friend, coworker, or acquaintance.
- You can reach people who aren’t actively looking for a job, so there’s less competition to hire them.
Get Referrals From Friends
Ask people you know and trust for names of people who may be a good fit for your team. This helps you identify candidates who aren’t on LinkedIn or GitHub, but who have a great reputation with people whose opinions you respect. When getting referrals, make sure that you get info about their current work situation, what kinds of companies they’re interested in, and their contact information.
Hire Your Former Coworkers
Let’s say you’re starting a company in your mid-30’s. Chances are you’ve worked at four or five different companies, kept in touch with people over the years, and have a long list of former colleagues in different settings. Or maybe you know a ton of people from college or high school. It may sound obvious, but go hire the great ones. It’s powerful to feel confident about what you’re getting from day one.
Getting the Team Right From the Beginning
Here are strategies to lay the right foundation in order to maximize your chances of success.
The Right Mix for the First Ten People
Finding the balance between different functions is challenging, and many of the startups we talk to are heavy in a single area like product or sales. If you’re a technology company you may think that you need to focus on hiring engineers above everything else. This may be true, or it may mean that you’re missing a marketing genius to help you actually find customers.
It’s important to understand why we hire people at all: to make the existing team more productive and to push the core metrics in the right direction. Sometimes this does mean hiring an engineer to move product development along, and sometimes it means you need to hire that marketing person. Whatever roles you recruit for, be flexible and test things out until you find the ideal mix. You might try a consulting arrangement for the first few months while you’re getting to know someone.
When to Hire and When to Fire
Hiring people can be fun because everyone is optimistic. Firing them, on the other hand, is gut-wrenching, deeply personal, and difficult to pull off without leaving egos bruised and emotions high.
Getting the team right sometimes means owning up to your mistakes and parting ways with people who aren’t living up to expectations—before they affect the rest of your team’s performance.
Lars Dalgaard, the former CEO of SuccessFactors and a partner at Andreessen-Horowitz, offers some excellent advice:
“No one ever fired someone too soon. This is a seasoned refrain I hear a lot amongst experienced founders and CEOs, and I have never heard anyone disagree with it. …Not firing someone means not moving ahead with the right person that much earlier, you’ve now started the clock of underperformance, and the longer you wait, the longer that clock of lost opportunity is ticking. The longer you wait to fire them, the more compounded success is lost.”
For one of our 10xU members, whose founder was great at software development, the first year of hiring looked like this:
- Brought in a co-founder to help with sales.
- The co-founder ended up working on another project, so the original founder did both development and sales for a while.
- Brought in a second co-founder with previous experience at Oracle to help with sales.
- The second co-founder couldn’t operate in a startup environment, so the original founder did both development and sales for a while. The original founder eventually fired the second co-founder.
- The original founder wanted to spend more time on sales, so started putting together an on-demand development team via Upwork.
- The original founder hired a lead developer, which freed up more time to focus on sales.
- The first co-founder saw how well things were going and came back to do sales. This time it went much better.
- The original founder is now hiring a product manager to keep development running smoothly.
It’s not a straight path, and you can see how the hires bounce back and forth between technology and sales in the search for product / market fit.
Setting Expectations Early
When you’re hiring people fast it’s easy to get caught in the trap of constantly looking for new people at the expense of properly managing your current team. One effective strategy is to set expectations with your team in advance. Have each candidate come up with a 30-day and 90-day plan, preferably before you hire them. Hold them to what you agreed on at the same time you’re helping them achieve it.
This only pushes people to excel, but it can also
- Help you know when you need to hire new people
- Show when someone is ready for a promotion
- Indicate when it’s time to let someone go.
One Last Thing About Hiring
You probably started your company because you’re really good at something. I was a software developer, and all of a sudden I was getting so much work that I had to start hiring people. I was a terrible manager at first.
In fact, leading a team is pretty much the exact opposite of being really good at software development. Or sales. Or whatever. Running a company means learning how to manage people, and eventually teams.
Look at how hard Mark Zuckerberg worked to keep his job as CEO of Facebook—while also hiring insanely great people like Sheryl Sandberg to help him succeed.
Acknowledge that you need to learn to manage, and then practice it constantly. The good news is that you get another chance every single day.
The most important question you can ask each teammate is, “How can I help you do your job better today?”