Making your first hire is a big deal, and getting it wrong could cost you your business. This may sound exaggerated, but with 15+ years in People and Talent, I can say with confidence that your team is the heartbeat of your company, and you can’t get much done without them. Any time, money and headspace that is wasted on a bad hire is time, money and headspace you could’ve used to hit your quarterly or annual targets, which is essential in the early days. Not to mention the huge impact that your early hires will have on the culture of your business going forward.
With decisions as pivotal as these, you might be tempted to defer to advice from your investors, considering they have a wealth of experience and have seen the successes and failures over the years. I’d urge you to do your own work too. In some cases a classic playbook of hiring Head of Growth, Head of Community, Head of Ops may apply, but not always. You are the only you to build your business, with your unique set of strengths and weaknesses. It’s critical that you do your own individual work in discovering who your early hires should be.
In terms of what this work may look like, I’ve laid out a 4-stage toolkit for making your first hires, to help guide you through this process.
What you’ll need
What will you need for this process?
- Self awareness (and a good investor or pal to verify your self awareness)
- Your business goals
- An understanding of what good looks like (i.e. a benchmark from a similar successful company)
Stage One: Explore your skills and values
- Personal values session
- Personal skills analysis
This stage is all about discovering what your personal skills and behaviours are and how competent you are in delivering what the business needs.
Exercise 1: Personal Traits and Values
Firstly, jot down your answers to the following questions. I’d recommend using a quick-thinking approach - this exercise should take you no longer than 15 minutes.
- Who am I?
- What is important to me?
- What do I seek in those closest to me?
- What are my positive traits or behaviours?
- What traits or behaviours am I working on?
These questions ask you to articulate the things you care about (your values) and any positive or negative traits that you have (your behaviours). Articulating your values is important for two reasons. Firstly, it sets the foundations for your working relationships, and the culture of your business as it evolves. Secondly, your personal values are likely to become your workplace values, and any new hires will need to align with these. Research shows that companies with an authentic set of founder-driven values that are consistent with the values of employee’s have greater team coherence and productivity. And team coherence and high productivity is exactly what you need in the uncertain, tiring world of early-stage company building!
An example of what a founder-hire relationship with aligned and unaligned values and behaviours might look like.
"TOP TIP: After going through this process, you should create a ‘ways of working with me’ guidebook that you share with candidates early on in the process, for full transparency on your preferred ways of working. The guide should outline your values, key skills, and how you like to work.
Exercise 2: Personal Skills Analysis
Next step is to explore your competencies. This analysis can be tackled in two steps.
Step 1 - Firstly, jot down all of your skills. This should be based on previous experience/examples of work output, not what you think you could do. This is a great exercise to do with close ex-colleagues if they are open to calling you out on your weaker areas.
Step 2 -Map these skills against your level of competency in each - from beginner through to expert.
For example, if you are a technical founder, below may be the skills you evaluate yourself against. Simply add a ‘x’ next to where you see yourself.
The fifth column asks you to sense check your competencies with your investors or colleagues. I’d encourage you to approach as many people as possible. Most investors will have carried out this exercise on you in some form ahead of making their investment, so it shouldn’t be a big ask.
Having completed this exercise, you should head into stage 2 knowing:
- What values and traits are important to you in your hires and how you work
- Your strengths (give yourself some recognition for this!) and your weaknesses
Knowing your strengths and weaknesses is especially important for the next step, as this is where you’ll begin to figure out what skills are critical in helping you reach your business goals, and thus what kind of hires you’ll need to make.
Stage Two: Map your skills against business goals
Now, it’s time to understand what parts of the business you should deliver against, and what parts should be left to other team members. In an early-stage startup it’s likely that as a founder, you’ll be delivering against more than one area - wearing ‘many hats’. But it’s important to be realistic about how much you can deliver to a high quality. Just because you’ve done user research before this doesn't necessarily mean you can deliver it with the skill and pace required to hit targets.
To do this, you’ll map your skills against your company goals. For each company goal - or company level ‘OKR’ - there are two steps you’ll need to take.
Step 1 - Ask what skills you need internally to land this OKR
Step 2 - Identify what skills you lack and include them in your role requirements
Let’s take the below OKR as an example, assuming again that I am a technical founder.
Objective: Fuel growth through product diversification.
Key Result: 40% of revenue from new product line.
Step 1: Ask what skills are needed
The activities needed to hit this key result may include customer development, user research, building a prototype, sales and financial planning.
The skills these activities would require could include:
- User research
- Engineering ability
- Financial planning and analysis skills
Step 2: Identify what skills you lack
Given I’m a technical founder that is passionate about their business, I can comfortably take care of sales and engineering. However, when it comes to user research, I have a high level of theoretical understanding but no practical experience. And with financial planning and analysis, I have little theoretical understanding or practical experience. Therefore:
I’ll need someone who has user research skills at the level of an individual contributor, and FP&A skills at an expert level.
You should end up with a similar list of requirements that outline the skills you need at the individual contributor level and those you need at an expert level.
As with my example, this could end up being quite a unique combination to capture in a single hire. Often we find co-founders come into play at this stage, or hiring a generalist in the startup space who has complementary skills. Alternatively you could hire individual contributors for each unique skill set or short-term freelancers.
"TOP TIP: In addition to hiring for your skills gaps, you should also hire people who exhibit complementary personality traits, as explored in Stage 1. For instance, if partnerships are OKR-critical, and you’re a big softie, then you need to make sure to have someone on your team that can take on negotiations.
Stage Three: The level of your hires
By the end of stage 2, you should know how senior your new hires need to be, based on the skill set that’s required. However, it likely won’t be as simple as this.
Here’s the dilemma. You need to attract top talent and you may not be able to pay top dollar. So you need a sell, and some founders use senior-level titles as that sell.
My pennies worth is that you should only throw around big job titles if they are essential. If you hire a C-suite level employee and in reality the skillset you hire is that of an individual contributor, then you’re creating a rod for your own back as you evolve. Especially if they don’t have the desire to operate as a C level team member. As a People team consultant, I have been shipped in countless times to manage a messy exit with an original employee who has been hired above their rank but refuses to let go of the title.
To get around this you can either,
Hire the level you need to land your company goals. This may be more senior that you need right now. E.g. you may need a CTO to develop the strategy of the tech as it evolves, but in the first iteration they need to build your product.
Hire at the level the role requires but recognise with your candidate that as the company evolves you will need everyone to take on larger accountability, responsibility and as a result of such, job titles will reflect the reality of the job.
Whichever route you go down, make sure to be completely upfront with your candidates.
"TOP TIP: All early hires regardless of their seniority should have almost as much excitement about what you’re building as you do so that you can maintain momentum. Always look for passion, energy and flexibility.
Stage Four: Run a killer hiring process
Put the same effort into the hiring process as you have in identifying what you need (and give yourself some flex in terms of the people you meet). Meet a couple of candidates perceived as too senior so you can see what great and experienced will look like. Also meet less senior, ‘high potentials’ identified in your network. Can you see this potential too?
There is a great deal to consider in your hiring process, which in itself is a separate article, but here are some top tips:
- Write a JD that is exciting, brings the job to life and isn't just a bullet point list.
- Create a candidate pool that is representative. Give yourself the best chance at meeting as many people from a number of different backgrounds.
- Set up your ways of working document to share during the process (2nd stage recommended)
- Make sure to include a task asses the depth of their competency - bring in a VC partner, a coach, a mentor to verify your analysis.
- Ensure values, traits and culture take a lead in your process.
- Reference reference reference - I have read a few blogs recently which suggest these are not important. I have personally had to deal with repercussions of hiring without references - don’t risk it. Invest time asking for warts and all.
Sell the dream as a reality. This is an essential part of your company and success in your infancy. Talk openly about the graft and the challenges.
This may seem like a lengthy process, but it's worth it. Given the graft of getting a company off the ground, these are people that you'll be spending an overwhelming amount of time with. You’ll want to get it right. Building out your team is an incredibly exciting and rewarding process, as this is the squad of people that you'll experience so many highs and lows with. I wish you the best of luck with it all!
- Put in the preparation now - things get even busier from now on!
- Don't compromise on values/traits and make sure to be clear on them before hiring
- Base your hiring on skills that you know you need (based on your company goals )
What you do is who you are by Ben Horowitz
The Motive: Why So Many Leaders Abdicate Their Most Important Responsibilities by Patrick Lencioni
The Fundamentals: OKR's via Medium.