How to recruit for a startup
You have an idea? Great.
Feel like you could change the world? Even better.
But as the saying goes: if you want to go fast — go alone;
if you want to go far — go with others.
I can say with confidence that I know the amount of work involved in getting a startup off the ground, I have been living that adventure myself since nimbld started. And in that process is the very important step of assembling a team to support you as you push towards your goals.
A key stage is when you go beyond your initial “band of misfits” and move towards hiring and onboarding your first paid employee. I won’t go into detail as to when you might know the time is right for this (very likely in a future post, why don’t you subscribe so we can let you know when we go into this?). Today I would rather talk about what is involved in hiring that new employee once you’ve decided the time is right.
Hiring new staff isn’t quite as easy as holding some interviews and shaking hands with your preferred person at the end. The complexities involved are something very much worth knowing about and can be tricky enough to even make you rethink hiring.
First question to ask yourself is: is this truly the right time?
Trust me I know just how lonely this business can be at the beginning, and it can be very tempting to bring someone in so you have someone to confide in, an ally and battle companion. I really get that. But remember that that’s what friends are for. If this is truly your main concern my advice would be: find a mentor, or advisors, as sometimes friends might not truly understand what you’re going through, as much as they’d like to. Friends can often end up filling us up with words of encouragement, and don’t get me wrong — there definitely is a place for that and it can really help us keep going — but sometimes you need the precise application of footwear to derriere.
Remember that being a people manager is a job unto itself, and your workload isn’t going to magically disappear because you now have staff. In fact it might increase as you will need to ease your new team member into your processes, workflows, culture. You will need to weigh the pros and cons from a place of full awareness of the facts.
If the answer to all the questions above is yes, then read on.
What kind of leader are you?
Or rather, are you a leader… or are you a boss?
If you find yourself with a burning need to micromanage your staff every step of the way, ask yourself: is this because you don’t trust your new hire’s skills, hired the wrong person, or are too used to having things being done exactly your way? If the latter, perhaps you have… trust issues?
Becoming a good leader is about learning to let go of the way you would want things done, in favor of not having to do the things yourself so you can focus your time and energy on the things that truly move the needle. A good hiring strategy can really help with all of this, so you ensure you are getting the right people in, at the right time.
What about culture fit?
There is more to finding staff than putting an ad out, interviewing, and getting the most skill for the lowest price.
From as early as possible in your entrepreneurial journey you need to have a vision for the type of company you want to build, as well as what type of founder and leader you want to be. This vision should extend to the people you would like alongside you for the journey and what qualities you will need to see. Remember that a key part of growing an effective team is having enough “range” to involve and welcome people of different and diverse backgrounds and temperaments (think of all the jobs you really hate to do… you will need to find people for whom those precise jobs are the most interesting thing in the world).
The importance of hiring to generate Value
Hiring new staff should serve a single purpose: to generate value. This might be tricky to measure with certain roles where the value usually becomes apparent a little later on, such as with certain roles in marketing, etc. But in the long run this new hire should bring in more value than what they are taking as a salary.
Sometimes though, both in startups and small businesses, there are crunch times. Be careful to not jump to hiring when the pressure is on, as you might find yourself overstaffed and overextended financially once the pressure drops — as it invariably does (and if it doesn’t, this is usually to do with strategic or mismanagement issues).
In a crunch time ask yourself: is a new hire going to move the value needle long-term, or merely take some of the pressure off? If the former, definitely consider expanding your team. If the latter, perhaps hiring freelancers or contractors is the way to go.
Well. Where to start?
Freelancers
A freelancer is a self-employed person who works for different companies on a variety of projects. By hiring freelancers you are outsourcing your workload to specialists that can help you on defined, time-limited projects, without bearing the additional cost and responsibilities of full-time company hires.
It’s a great way to lift weight off your shoulders and streamline productivity past crunch periods, so that you, as a company owner/founder, can keep your eyes on the road and keep the company moving forward.
Permanent staff — the basics
As you bring staff into your company there are many different bases that need to be covered to ensure you are doing everything by the (legal) book, both for your protection as well as that for your employees. This includes:
- Payroll
- Health & Safety
- HR
- Insurance
- Contracts
As Ben Franklin rightly said “nothing in this world can be certain, except for death and taxes”. It is one of those necessary things, and without going into the whys and wherefores of tax systems, it is simply one of those things that, regardless of your feelings about it, needs to be done.
If you are a UK entity you will need to be set up with HMRC and ensure that you are complying with tax regulations when paying someone. This will involve making regular PAYE payments to HMRC, and much more.
If you work in an office, or have a remote workforce, as the employer you are still responsible for ensuring that your staff has a safe working environment, and not at risk of injury.
But what to do if staff aren’t performing to your expectations? Traditionally, in a larger company, HR would be the place to go. But as a small business you may not yet have an HR department. Thankfully there are many resources out there for early businesses, which can help every step of the way. One I personally recommend is Farillio. SeedLegals also offer wonderful resources, albeit more geared at startups specifically. (As our own network of nimblers grows you will also find plenty of HR consultants within it!)
You will also need Employers Liability Insurance to cover any health and safety measures you might need. Employers Liability Insurance typically covers costs if an employee becomes ill or injured as a result of the work they do for your company.
Last but not least you will need an employment contract in place. They must be given a written contract within 8 week of being offered the position, by law. Again, the resources pointed above can really help with this: Farillio for freelance contracts, as well as early hires for small businesses, and SeedLegals for Founder Agreements, as well as early hires for startups.
The UK government also released a handy list of everything you need to cover. You can find it here: https://www.gov.uk/employing-staff
For our US community: we will write an article more specifically geared towards the needs of early stage US companies, as the US landscape is more complex. Don’t forget to join our mailing list to be notified when we release this guide!
The hiring process
You’ve done the thinking and arrived at the conclusion that hiring is the right choice, but there are a few items that need to be considered before hiring, especially during the interview stage:
- Are they an expert or a generalist? How does this fit with your company journey? Prioritize hires that are likely to stay the distance, and who would wear multiple hats as you grow
- How do they fit in with your vision? How well do they understand what you are trying to accomplish?
- How do they fit with the culture and other existing team members?
- How much training/supervision will they need? Ideally you will need someone who can hit the ground running and who can do as much as possible on their own steam (and you will then need to ensure you stay out of their way and let them work! ;) After all you will have hired them for a reason)
- Be honest during the interview stage of where exactly the company is right now, and where it is headed. Remember, you are being interviewed as well!
- Don’t rush the decision — as much as you might be hankering to just “ship” this and move on to the next item in your growing to-do list. Thoughtful consideration will quickly pay dividends.
- Can you afford this employee, now? What if growth doesn’t happen at the speed you would like?
Remember that hiring is also an exercise in networking: a significant amount of candidates that might not be right for the position, might simply not be right for “right now”. Don’t be afraid to stay in touch with candidates with whom you built good rapport, you never know what the future may bring.
The Takeaway
Only you as the founder will know for certain when is the right time to expand your team with new hires.
If in doubt, I use the following litmus test: unless it’s 100% yes, it must be 100% no.
Trust me, the last thing you want is to onboard someone… only to have to let them go soon afterwards. Firing people is never fun.
