5 Hiring Tips for Startups

Startups Should Highlight Advantages to Overcome Hiring Challenges

How Startups Can Hire More Effectively

You just got funded, congratulations! By now, you’ve likely accepted the condition of working with limited resources as the price for entrepreneurship. It’s not typical to receive carte blanche from your investors when it comes to paying yourself or your people. So how do you hire the best talent the market has to offer when your competition holds longer purse strings?

Who is your competition you ask? Well, every company looking to hire the same skill sets you need. That’s a lot of competition. According to the Bureau of Labor Statistics, hiring in the private sector has increased each year from its lowest point in December 2009. An average of 67,000 jobs were added in August 2010. August 2013  brought 139,000 new jobs to the non-farm payroll. August is arguably the slowest month for recruiting and hiring, so the average monthly trends are higher throughout the rest of the year.

It’s an Employee-Driven Market

2013 has been the game changer in employment as the US job market turned from an employer to an employee-driven market. You want what every hiring manager wants; a rare talent. Instead of worrying whether you can afford them, have the clout to attract them and think about how the right candidate would value the opportunity overall. If you don’t have the budget to meet the lower end of their base salary requirements, talk about the upside of equity, autonomy and growth.

You might be surprised at how attractive your company is to a potential hire. A candidate who looks like an exclusive Fortune 500 star may actually prefer a start up. And, if they have prior early-stage experience, chances are you won’t have to walk them through the painful reality of doing more with less. They will have lived it, and loved it.

Here are the top 5 selling points of your start up:

5. Creativity

How often does a professional get the opportunity to flex their creative muscles? Not as often as they’d like.

An entrepreneurial mindset should be a requirement in your quest for hiring talent, but so too is their desire to use every tool in their tool shed. This includes the fire of imagination AND the latitude to employ it. But you don’t want them to burn down the barn either.

Setting limitations early on will empower your team to make smart decisions with the entire company’s financial and cultural health in mind.

4. Autonomy

A professional’s ability to visualize and plan is more valuable if there is equal strength in the ability to execute.

Giving someone with proven experience an opportunity to work through a challenge independently, without influence or close supervision, can lead to a highly rewarding and cooperative partnership. Build trust over time if you are not comfortable handing over the keys to the kingdom right away. Start with a less critical project and reassess and regroup if necessary.

Developing a hands-off management style for your entire team isn’t realistic, but it may ultimately free you up to allow people the room to learn, make mistakes, and succeed.

3. Equity

Never underestimate the power of ownership.

Even if you offer a limited amount of equity, some is better than none. But also use an offer of equity to gauge a candidate’s seriousness and commitment to your vision. Hiring someone who doesn’t value equity, or doesn’t understand how it benefits them, could mean you’re taking on a flight risk.

If an employee has a higher cost of living and can’t manage the risk of working for you unless you match their base salary requirements, then don’t make equity part of their compensation package. But do make sure they understand what they are forsaking. Also, tying additional stock grants to MBO’s as part of your team’s performance review and raise period can entice employees to work harder and be more thoughtful of their performance.

2. Street Cred

Who doesn’t love the idea of saying they were employee number 4 in one of the most successful startups in your industry or region?

The value that has on a resume is incredibly powerful. This can open up a variety of professional and personal opportunities, and increase their market value to future suitors. According to a recent study by Statistic Brain, the failure rate for startups is still high from year one (25%) to year 3 (44%), but why let that detract from the pure joy of unbridled professional opportunity?

While you may never go public and your exit strategy may not be clear right now, giving someone the opportunity to work in a startup can be the best thing you ever do for them and their future.

1. Growth

Like number two, the growth that comes from investing time and talent in a startup can pay employees back 10-fold.

The advanced knowledge and skills they will develop sets them apart from their competition. Exposure relative to disruptive technologies and first-hand experience in an early stage company makes them extremely attractive to other companies, and typically very loyal to their employer. If engagement is high, the novelty is unlikely to wear off within the first 3 to 5 years.

Choosing the Right Employees Is Key

If attracting candidates isn’t a problem for you, but identifying the right one has you up at night, you may want to consider outside counsel. An HR Manager or objective board member can make a great second set of eyes and ears. It is easy to get swept up by a passionate plea for the chance to work for your startup, but this potential employee’s attitude needs to be tempered with realistic ideas and expectations about what that means.

Just because someone demonstrates an appetite for high risk doesn’t mean they understand the rigors of growing a company, especially from the embryonic stage. Nor should they be expected to write their own job description. You still need structure and clearly defined roles, specific goals or milestones, and check-in points along the way.

An employee who has lived through the demands of an exciting start up also understands the need to balance each success with a sense of cautious optimism. Their attitude about growth and failure is key. If you never get beyond a Series A round, you don’t want disengaged employees polluting the water cooler.

Look for the Good, Bad, and the Ugly

When you find yourself across the table from a dynamic talent, don’t be afraid to share the good, the bad and the ugly of your start up. The smartest and most talented engineers, sales/marketing and operations professionals will figure these out anyway, and they will respect you more for openness and humility. In fact, that may be the best way to engage and attract them into your employ.

Bottom line; know your audience, understand your strengths and articulate your goals persuasively if you want to get a candidate’s attention. Be honest with them and with yourself. If you’re going to spend 60 hours a week or more together, you better like each other — a lot.

Make Sure You Pay Employees Fairly

Don’t spend all that time searching out the perfect employee for the position and then drop the ball when it comes to salary negotiation. Bottom line is you need to make sure your company is paying a fair wage, and that’s where we come in to play.

Share with:

FacebookTwitterGoogleVkontakteTumblrStumbleUponLinkedInRedditPinterestDiggDelicious


Business, candidates, Hiring, HR