What do you need to know to hire and grow your team and startup?
Your team and hiring is one of the most important and pivotal parts of launching and maintaining a successful business. This one factor will make or break you.
It is also one of the areas that most founding entrepreneurs find most challenging to get right. So, how can you get it right? Who should you be focusing on hiring? Where do you find them? How do you pick the right team members and manage them successfully? How do you do all of this on a budget or while bootstrapping?
The Ultimate Guide To Pitch Decks
Here is the content that we will cover in this post. Let’s get started.
The Importance Of The Team In Startups
It’s all about the people. That’s what experienced and the most successful entrepreneurs will tell you.
Having the right people in the right seats on the bus is a critical ingredient in the recipe to startup success.
A company is made up of people. Not just bricks and mortar and data points. No matter how talented and intelligent and energized you are, you just cannot do it all alone. Not even with all of the best technology and automation.
In order to grow your business, you are going to need to grow your team. That means getting great at hiring them. However, it is also worth pointing out that just being bigger isn’t always better. Headcount can be a data point to watch. Though so is revenue per employee.
The bottom line is you need people. The player in the space with the best team is the one that will win. This is why angel investors and venture capitalists put so much emphasis on the team when considering funding than any other factor.
In this regard, keep in mind that in fundraising, storytelling is everything. In this regard for a winning pitch deck to help you here, take a look at the template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash.
Remember to unlock the pitch deck template that is being used by founders around the world to raise millions below.
So, where do you start and go from here?
Understanding Your Role As Founding CEO
Before you can intelligently start recruiting and hiring, you need to decide what you are hiring for. Finding those gaps begins with understanding your own role as a founding entrepreneur.
The achilles heel of most startup attempts is founders trying to do everything. All it does is slow you down. Often crippling you before you can reach a tipping point which will enable you to survive.
You should absolutely have some handle on the different functions in your business. Including customer service. Just don’t get stuck there. There is no way you are going to sell a million units if you are the product designer, janitor, customer service rep, delivery driver, accountant, lawyer, manager, and blog writer.
So, evaluating what truly successful entrepreneurs with large-scale ventures say that they actually spend their time on, what can you expect to be doing all day?
Sorry to burst your bubble, but it is probably not product-focused. That didn’t even work out for Steve Jobs. If you have a cupcake company you aren’t going to have time to bake in the kitchen. If you have a software company, you probably won’t have much time to do the coding. Make sure that you are comfortable with that now. This is the difference between building a real business and a fast-growth startup versus a hobby.
Hiring & Fundraising
Veteran entrepreneurs say that they often spend 50% or more of their time on each of these two factors.
Of course, to excel in fundraising you will probably have to do some smart hiring first too. If you don’t it will be very difficult. Given that fundraising is really a never-ending process, if you don’t nail this first, you are going to find it very hard to find any time to hire for the other areas of the business to put that money to work.
If most of your time is taken up in hiring, that speaks a lot to how important it is for you to understand and get good at.
Your number one job as the CEO is really to make sure your company doesn’t run out of money. If you fail there, there is no money to hire or no business to run anyway.
With funding, your job is to hire the best people to run and grow your business.
While this may make you more of a conductor, rather than a musician in the band, you can’t afford to just become a manager either. You don’t have time for that. At least not at anything but the c-suite level.
See How I Can Help You With Your Fundraising Efforts
See How I Can Help You With Your Fundraising Efforts
Your other main role as a founder is to share, instill and keep buy-in to the vision.
As you build and grow your team, you have to keep them focused on the vision. Don’t expect anyone else to be near as good as you at this. This is what you are really passionate about. What you need to keep them working towards in order for the team to make it happen.
This is the role that most startup entrepreneurs overlook. To their peril.
Right from the beginning you should be organizing, strategizing, and orchestrating the exit. Which makes it even more vital that you have been growing the team to take care of everything else. Including hiring, fundraising, and keeping the team on a mission.
Even more so, once you get into the M&A stage, or go public, it is going to be all-consuming. If you don’t have everyone in place to run everything else that deal is likely to fall apart. Your business may also collapse in the process too.
What You Need To Know
One of the big misconceptions that slow down startups, lead to stress, and end up in inefficient hiring is that first-time entrepreneurs believe that they need to make lasting hires. They think they have to be perfect because they are going to keep these team members forever.
It is very rare that is the case. It is great if you have a couple of core cofounders or team members that see this through to the end with you. Even better if they go on to help you start and grow and exit your second and third startup as well.
Far more often, they are going to be there for a short period of time. For a certain purpose and stage, and then go on to something else. While you replace them with the talent you need for the next phase in the journey.
Your company is going to completely change every 12 months if you are growing and doing things right.
The same is true when people are searching for their first home. Far too many spend months and years looking for the perfect home. They waste so much time and opportunity. Then in a few months, their needs change, and they are looking for what’s next.
This is true even for you. It is rare for the founding CEO to stay on for a long time. Especially after an exit or going public. You play your part, and then probably move on to starting a new venture from scratch again.
Who To Hire
Two of the most vital things for every startup are funding and sales. Without funding, you are going bankrupt. That will happen even faster without sales. Even with capital, you will have to keep up the sales to keep investors happy, get more funding, and to stay alive. It doesn’t matter how genius or need the product is, sales and marketing is vital. It is a skill most entrepreneurs aren’t masters of when they start. Yet, with strong marketing and sales, everything else can be provided for. So, perhaps before anything else, these should be among the first positions to fill.
Many seasoned founders also say one of their biggest regrets is not having hired more high-level executives earlier. This even includes hiring a CEO. If you get out of the way and focus on hiring those executives and department heads they can oversee their team needs and grow them.
If recruiting, hiring, and dealing with new hires isn’t your thing, then one of your first hires may be an HR person. Let them handle all of the hirings. It could free up 50% of your time.
Even before that, you may need a personal assistant. They can free up an enormous amount of time by taking on the busy work that isn’t putting dollars in the bank and increasing the value of your company.
How To Pay Startup Hires
One of the biggest perceived challenges for startup founders is how to pay for help. They know they need help and the best out there, but how do you afford it? Especially with so much competition, and asking them to take the risk on your unproven venture.
Some of those options include:
- Offering equity and options as a part of their compensation
- Focusing on on-demand hires, such as outsourcing
- Sticking to remote workers with less overhead and liability
- Bringing in cofounders with skills instead of salaried staff
- Bringing in investors with experience and connections
- Leveraging affiliates and franchisees to grow
- Raising more funding to cover hires
How To Pick Your Hires
Some of the priorities to look at when evaluating hires include:
- Hiring by values and company culture
- Be sure they are startup environment capable
- Ensure they have domain-specific knowledge
- Get their buy into the mission and vision
- Focus on quality hires over quantity every time
How To Find Them
Find hires through:
- Online platforms like Upwork
- Professional networking
- Your competition
- Great marketing that draws them to you
How Recruiting & Hiring Has Changed
Recruiting and hiring have changed a lot. Especially as the world of work has evolved and startups have taken over.
The best talent isn’t going to be sending resumes and jumping through your hoops like they used to. It is now on the company to attract them, make it easy, and convert them.
As methods and structures of staffing have changed, the old ‘hire slow, fire fast’ manta may also need to be revamped. Instead, focus on testing potential team members quickly on small projects, and then going from there. Once you find great ones, do everything you can to keep them.
Management styles that work for getting results and keeping great talent have changed too. This workplace is not a daycare center or pen for bullies to lord over. Give great talent clarity on their focus and goals, and focus on empowering them to do their best work.
The Dangers Of Scaling Too Fast
Going fast is important in startups. Yet, hiring too fast can bring additional dangers and challenges.
There is nothing worse than the feeling of having to let people go. A great and sound startup must be able to be agile and scale up and down. Both as you change directions and deal with exterior factors.
While a team is necessary, they can also be one of the biggest areas of liability and overhead, and you are in any sense taking responsibility for them.
Growing a team is one of the fundamental pillars of business success. This makes startup hiring one of the most important areas for founding entrepreneurs to grasp.
Some of the most important elements to master here are knowing how to manage your own time, who to hire, what to look for in them, and how to structure your team and their compensation to land the best and remain solvent and competitive.
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