Finding and Hiring Talent at an Early Stage Startup

I was recently asked what I consider the hardest part of founding a startup. The answer, of course, is that it’s all hard: finding the right idea, prioritizing, executing, and evaluating when or if to change course.

But if I had to choose the hardest piece of all, it’s finding the right people to work with. It’s tempting to shelter your baby startup from all outside influences. As long as you and your cofounder(s) are the only ones working on it, you’re in control. Ceding some of that control to new hires can be terrifying, especially if you don’t know them well. But if you really want your baby to grow up and be a self-sustaining or, ideally, world-changing business, you need to allow others to help shape its development.

So the following are some tips which I hope might be helpful as you embark on your search for employees 1, 2, 3 and… well, that’s as far as I’ve gotten, so when I know more I’ll try and report on that.

Finding People Worth Hiring

AngelList is probably the best job board to find startup-minded talent, but there’s a lot of noise to sift through. I use AngelList the same way many people use Tinder: I ‘like’ anyone that looks vaguely interesting, and if they ‘like’ me back I delve into their profile and see if they’re actually worth pursuing.

– Use your trusted networks. People often overlook things like their facebook timeline, their college’s job board, their floor hockey league email circular, etc. It’s like they’re ashamed they’re hiring. There is nothing wrong with being in a position to hire talent. Shout it from the rooftops. Put it in your email signature line. You never know when your mom’s friend from church has a son who happens to be sick of his job at Zynga and wants to move back east. And connections, even loose ones, help ensure that you don’t get stuck with a psychopath (more on that later).

– Be visible in the community. Present your startup at meetups and conferences, or try and get press. If you can’t get on a panel somewhere, organize your own event. If you can’t get press, publish a blog post or an infographic others might pick up. Answer questions on Quora. Be active on social networks, especially Twitter. If you were a talented startup-person, would you rather work for a respected, contributing member of the tech community or an MBA who has never built a business before?

– Poach! The people you really want to hire probably aren’t on the market: they’re already doing good work at a successful company. But their souls might yearn to be at an early stage start up. Help them achieve inner peace. Look for startups that have really taken off in the last 2-3 years, and identify the people that have been there from the early days. They obviously had and probably still have interest in working at a smaller company. Also, just as importantly, they’ve vested into most if not all of their equity (assuming standard 4-year vesting), so have less reason to stay in their current job. Woo them. You have something in your arsenal that is, to the right person, more attractive than money: the opportunity to build something new and innovative, or at least have fun trying. 

The Interview Process

– Letting the interviewee talk, rather than badgering him or her with questions, can surface the most interesting responses. Without being too awkward about it, try and leave enough time after an interviewee gives an initial answer so that he or she can add more. Example of a conversation I had once:

Me: what do you consider a good work-life balance?
Him: I think if you’re really concentrating, you can pack a really good day’s work into about four hours. And if you’re producing good work you’re going to be concentrating so hard that it’s difficult to perform well for more than four hours. So I really try and optimize my time, and of course I’m on call for more than four hours a day, but that’s probably what’s sustainable to consistently put out really good code.
(at this point I’m thinking that he’s probably right and this is pretty reasonable, but I wait just in case he wants to say more)
He continues: also at the end of the day I’m really quite lazy. I like my free time. I basically want to work the minimum amount possible. Fortunately as a coder I can usually get things done pretty quickly and no one really knows how long they should take so I can kind of set my own hours.
Me: …….

Needless to say, I’m not sure why this guy thought that was going to make me want to hire him. But I’m glad I waited and got the full picture.

– for a startup it’s important to ask the question: ‘If the company hit hard times, what would you do?’ If they say ‘I have student debt and/or a family to support and couldn’t take a reduced salary’, or something along those lines, they shouldn’t be disqualified. Nevertheless, it’s important information to know, and better to have that kind of conversation up front rather than when you’re against the ropes. Startups are so sexy these days, and lots of people interview for jobs at startups without really appreciating what that means: low pay, low job security, little to no benefits, all for the sake of an upside that is 90% not going to pan out.

– always hire people smarter than you, as long as they respect you and aren’t earning such a high salary that they’ve got no skin in the game.

Closing the Deal

– So, psychopaths. They exist, and they can ruin your company. Do your due diligence. Try and find some connection in the network of the person you’re hiring. I don’t actually like asking candidates to volunteer a reference, as I’ve always found that to be a pain when I was interviewing for jobs. I usually inform a potential hire that I’m going to try and reach out to people in my network who might have worked with him or her (it’s important to mention this so he doesn’t feel violated if he hears you’ve been snooping, but he should also understand that this is completely reasonable thing to do). I search LinkedIn for the previous company, see if I have any first or second-degree connections there, and reach out. Blind hires probably have a greater likelihood of working out than your average blind date, but that’s not saying much.

– when hiring I’ve always started people on a 60 to 90 day contract at a fair price (usually above what ends up being their salary, to compensate them for the fact that they’re not yet getting equity or in a long-term position), then negotiated ongoing salary/equity a month or two into their contract. Locking in a salary or equity number before youve worked with the person for at least a few weeks is like raising a seed round at a valuation rather than a convertible note: okay if necessary but preferable to postpone the valuation till you have more data.

– have hires (if you follow the above they’re contractors to start) sign a standard contract and agreement off Docracy if you’re too early stage to afford a lawyer. If you have less than $100k in the bank you are too early stage to afford a lawyer. I like Gunderson Dettmer’s standard consulting agreement.

– Read Founder’s Dilemmas by Noam Wasserman. So much wisdom.

In Conclusion

If we can learn one thing from Facebook’s acquisition of WhatsApp, it might be this: that no matter how smart or dedicated you are, you probably need at least 54 other people to build a $19bn company in four years. Don’t let yourself become an overprotective, smothering parent to your baby startup. It takes a village to raise one of these things right. 
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