How to Not Drown When Hiring Your Startup’s First Few Employees
So you’ve raised your seed, or have gotten enough traction to bootstrap your own growth. Congratulations! Now it’s time for your startup to hire it’s first few employees.
You’ve hit mile marker one in a very long race, but don’t break out the bubbly just yet… recruiting a team, especially as an early-stage company can be daunting. As a veteran of both venture-backed and bootstrapped startups, I’ve experienced the good, the bad, and the fugly over the last decade. The bad news? That startup life is HARD, yo.
But lucky for you, we have your cheat sheet on how to hire your team, the right way, without all the pain and suffering.
The Five Essential Elements for Hiring Right
Hiring well can make or break your startup. It’s worth it to set up the essentials before you start ramping up your recruiting efforts. It may seem tempting to slack on some of these steps because you’re “so busy” doing everything else—but it’s the business equivalent of living on candy + energy drinks; you may stay “healthy” for a while, but eventually it’ll catch up to you and, when it does it’ll feel like this:
Step 1: Creating a Hiring Roadmap
This boring-sounding pillar of good human resource professionals everywhere gives your company’s leadership a clear sense of the cost and time it will take to fill needed roles so you can reach quarterly/yearly goals and metrics. A hiring roadmap is vital for proper budgeting and it’s a realistic understanding of when you need to begin the recruiting process (usually far earlier than you think).
Also, if you’re planning on raising money-savvy investors will expect to see some version of a hiring roadmap in your deck. They’ll want to know who you plan on hiring with the money they give you and if you have a realistic understanding of what those roles will cost. A good blog post and some examples of how to build your own road map is here (thanks to the folks at Roadmunk).
Step 2: Setting up a Career Page and ATS
Great companies are always hiring, even when they aren’t actively filling a role. This is why setting up a career page with at least a generic application that is linked to your ATS is an investment that will pay dividends for years.
But first. A…T… Say what?
Alas, the world of recruiting is not known for our tantalizing wordplay. But ATS is shorthand for an applicant tracking system. There are many options that range in complexity and price—before you decide on one ensure you’re using it properly with the guide What is an ATS and How Can it Help With Recruiting? It discusses how an ATS works, what you should look for in an ATS, as well as tips on how to use it properly. Ready to make a choice? Check out this detailed comparison of the major applicant tracking systems available today.
At Avra, we use Breezy, which, so far, has been the best lightweight ATS we’ve found for the price. It’s the Toyota Camry of applicant tracking systems: affordable, not a lot of bells and whistles, but gets you from point A to point B safely.
Setting up your career page in a way that reflects your brand and culture, then being disciplined about processing candidates through that system will lead to a healthy recruiting ecosystem that ensures great candidates aren’t slipping through the cracks and builds a Rolodex of referrals and future candidates at your fingertips.
Step 3: Creating a Compelling Job Descriptions
A great job description tells a story. It paints a picture of your startup’s mission and vision, drawing the right candidates in while turning off the wrong ones. A great job description explains why the role exists, what qualities are needed on a personal level, and what competencies are required on a professional one.
Most of the time, especially for first-time founders, job descriptions are thrown together based on a google search of “X role job description” or cut and paste something from SHRM. It’s not bad to get inspiration from other startup’s job descriptions, but just like you wouldn’t cut and paste another company’s core values or mission, it’s vital to spend the time crafting great job descriptions for each role.
We wrote an entire blog post dedicated to creating a Compelling Job Description—it’s a framework we’ve developed over a decade and hundreds of searches, def worth a read 😉
Step 4: Tailored Interview Questions
One of the single biggest wastes of time I see teams do before they’ve built out a full recruiting function is reviewing applicants at the top of the hiring funnel. Instead of wasting your time looking at applications and guessing who may be a good fit, make the applicant do the initial legwork for you.
You can screen out subpar candidates through thoughtful questions. It’s amazing how many applicants will fall off in the written question phase, but these same bastions of mediocrity may make it to a phone call if you were ONLY judging on their resume.
You want a candidate that wants you—at least enough to answer a few written questions before they speak to someone whose time is valuable. Additionally, tailored questions will help bubble up the 10-20% of initial applicants who may be great.
Step 5: Standardized Scorecards
People are biased, emotional creatures. This makes deciding on the truly “best” candidate hard because of our unconscious stereotypes and associations. The solution is creating standardized scorecards so each person involved in the interviewing process is able to make more objective determinations about the applicant’s suitability. This will maximize your chances of hiring the best person for the right role. It’ll also minimize unconscious bias which de-risks your company from a discrimination/legal standpoint.
Why thinking through your hiring strategy early on matters…
Any founder or investor worth their salt will tell you people are your most important asset, regardless of what you “make”. It’s one of those cliches that is repeated so often it begins to fall on deaf ears, but setting yourself up for success when it comes to hiring the right people, especially early on, is absolutely vital to your startup’s long-term success.
According to the U.S. Department of Labor, the price of a bad hire is at least 30 percent of the employee’s first-year earnings. Other impacts include:
- Lost opportunity
- Cultural impact
- Management burden
But don’t listen to just me…
“I am convinced that nothing we do is more important than hiring and developing people. At the end of the day, you bet on people not on strategies.”— Lawrence Bossidy
“The competition to hire the best will increase in the years ahead. Companies that give extra flexibility to their employees will have the edge in this area.” — Bill Gates
“Great vision without great people is irrelevant.” — Jim Collins
“If you think it’s expensive to hire a professional to do the job, wait until you hire an amateur.” — Red Adair
The above is just the essentials for beginning to hire your startup’s first few employees. After you set up the basics, you need to be disciplined about managing the process, or it’s all for naught.
This isn’t easy, but it’s important. It’s the reason I started Avra Talent because we saw a gap in the market between in-house recruiting teams that only larger companies can afford and traditional commission-based recruiters (that frankly few founders ever *enjoy* working with).