Ask a startup founder what keeps them tossing at night, and many will tell you they agonize over how to hire the best people – and then keep them on board. After all, your success largely depends on the talent you find to help you turn your great idea into a thriving business.
We asked four experts who lead tech companies or have experience guiding recruiting at firms large and small to share their great ideas for success – and, as importantly, pitfalls to avoid.
Find missionaries not mercenaries Startup founders often tell us about how competitive the hiring market is, especially when tech giants seem to be vacuuming up talent left and right. But, here’s the truth: If we delve a little deeper, we sometimes find that young companies are setting their sights on the wrong people.
Steve Huffman, CEO and founder of Reddit, looks at it this way: High-level skills are essential but you don’t need to compete with the big companies. Instead, look for people with a startup mindset. Or as Steve says, “Find missionaries, not mercenaries. You are not going to win going toe-to-toe with [big tech firms] on comp because they basically have unlimited money.” The takeaway: Sell on vision and mission, and all of the intangibles you should be pitching – whether you are competing against large companies or not. And CEOs should not necessarily cede the job of convincing talent to join, as they almost always make the best pitch.
Know what drives your recruits. Frank Bien, CEO of Looker Data Sciences, says directly ask “Why be employee number 10,000 at a tech giant if you can be 300 here?” Play to your strengths, he advises, including the equity advantage. “Most of the people who are attracted to a smaller tech startup are there for the challenge of it, being in on the ground floor and being part of the ride.”
Calibrate your hiring wish list
Startup life isn’t for everyone. Think about it this way, advises Jennifer Holmstrom, a former recruiter at a major tech firm and now head of talent at VC firm GGV Capital. “People who are good at startup chaos are different than those who maintain high-performance software and are used to infrastructure and scale.” In fact, at her old job recruiting for a large tech firm, they likely would not hire an engineer with startup-sensibilities knowing it likely would lead to disappointment. It’s vice-versa for startups.
Thanh Nguyen, executive director of Connery Consulting, suggests you “recalibrate” your hiring wish list: “We see a lot of startup clients or their recruiters competing with larger company offers. We have to ask them, ‘Why are you going after that employee profile at this stage?’ If they don’t have a good reason, often times we advise them to recalibrate what they’re looking for.”
Focus on Day Zero
Another point at which young companies may fail in preparation – Onboarding. They land their preferred hire, only to throw them in the deep end without enough guidance and support.
“Onboarding is critically important,” Holmstrom says. “There is a 66 percent increase in retention if you do it well. Set up touch points at 30-60-90 days after the hire. Invest the time. It will make a tremendous difference.”
In fact, start before Day One: “If day one is a bad experience, you’ll never recover,” Bien advises. “We focus on Day Zero.” That includes having a formal ramp up plan before the new hire arrives and providing them with a mentor. Why go to all the trouble of hiring a hot candidate, then letting them flail? It’s a drag on operations. “The faster you can get people ramped, the more efficient you will be," he says.
Recalling his experience at Hipmunk, a company he co-founded in 2010, Huffman says he threw two new hires “into the deep end.” One swam while the other quit within three weeks. “If somebody doesn’t work out from the beginning, that’s your fault. It’s something you missed in the hiring process,” he adds. At Reddit, they bring out the welcome wagon. One big lesson: The more you put into it, the more you get out of it.
Create an authentic culture
Building a company from scratch is hard enough, and then there is the culture component. Start early. Culture is the glue that serves to help your employees rally around you and your mission, and is key for hiring and retention – especially during the rough times.
“We define culture really early. And it can’t be aspirational, it has to be authentic,” Bien says. It’s also important to discuss culture with prospective hires: “Really, you want them to understand it’s about the experience of joining something with the culture they are looking for.”
How to address inclusion and diversity In today’s world, culture is often partially defined by a company’s attitude toward workforce inclusion and diversity. No question, it’s a complex topic for any company.
Nguyen says young companies in particular feel challenged, thinking they are stymied in making headway by lack of budget, hiring capacity and access to job candidates. The message from our experts is: Business leaders not only need to talk about it, they need to recognize it’s critical for success.
Right now, Holmstrom says, is the perfect time for those in leadership to start talking about it. “The more they hear from you, the more integral it becomes and that will translate to your hiring teams so they know that is a priority,” she says.
It takes focus and will: Bien advises setting “a baseline from which to measure against. It’s not going to happen if you just have great intentions. It requires process and a real effort.” Diversity is good for business
A diverse workforce is critical to the success of your business. Huffman explains that Reddit is trying to build a product for a billion users. “If we want our product to appeal to a billion people, then they need to have representation in our company’s workforce.”
Likewise, Holmstrom say surveys show women do the majority of consumer spending: “To have that voice of the customer at the table is really, really important at the board level, at the c-level and on down throughout the organization. The more that the customer is reflected in the leadership, the better that will translate to profitability.”
Tips for making progress
We hear these kinds of questions a lot: Should we have explicit hiring goals? Do we change recruiting and interviewing tactics? Is it better to train and promote current employees?
Our experts advise getting creative to solve your particular workforce challenges and encourage open communications with your employees about your strategies.
If it’s hard to find diverse candidates for senior level positions, Holmstrom suggests focusing on more junior positions, with the intention of building a pool of internal candidates for later promotion. She also works with startups that link with specific universities that have a large and diverse tech-focused student body to build a pipeline for new hires.
Huffman says make it a team effort, and don’t forget about the inclusion part after the equation. “If you are hiring the first woman on an engineering team, you need to consider what to do to make it a success for her and the team. Talk about it, and say ‘let’s figure this out together’.”
Jake Moseleyis the Senior Market Manager for Silicon Valley Bank's National Fintech Practice and Northern California region.
Jake Moseley is the Senior Market Manager for Silicon Valley Bank's National FinTech Practice and Northern California region. He is responsible for the leadership, client relationships, sales and risk management for SVB’s core constituency of venture-backed and independent technology companies in the region, as well FinTech companies nationally. Jake has more than 15 years of experience working with technology, life science, clean tech, private equity and venture capital clients worldwide.
Prior to his Market Manager role, Jake was a Global Senior Credit Officer for Silicon Valley Bank taking primary responsibility for the loan approval and risk management for SVB’s lending activities in the UK and Israel, as well as within the payments space.
Jake previously served as Head of Commercial Banking at Silicon Valley Bank’s UK office. In this role, he helped establish the bank's UK branch in June 2012, and led the sales and marketing teams in the region.