💼 How to hire Tech Talent at Early Stage startups?

Hiring the right people is a crucial part of a founder's role. My cofounder once told me:

I have come a long way since then and, over time, I have made many hiring mistakes and learned numerous lessons. In this article, I will share those lessons by answering the 4 most important questions about hiring talent for your early-stage startup.

1. When to hire?

2. Where to find?

3. What to look for?

4. How to engage?

It's important to note that this is especially aligned toward early-stage startups, and for later-stage startups, while the challenge remains the same, the solution could be different. What your startup becomes later on is highly dependent on the steps you take at this stage.

When to Hire?

Many founders believe that the first step in building a startup involves hiring people. This is often due to the skillset and productivity that come with specialized roles. Another less talked about reason could be the founder's ego, satisfied by managing many people. Many startups that received funding in the VC bull period did so to avoid competition, thus creating a talent bubble.

However, this theory is fundamentally flawed in many ways. It's true that founders don’t need to know everything, but they should have significant knowledge that’s important to the business. That core expertise should not lie outside the founders' forte. For example, an AI startup needs one of its founders to be an expert in AI but doesn’t need to know everything about app development. During Entrepreneur First, I learned this to be called the "Edge Fit." There is a high likelihood that founders will be the only ones working on the project without any team members. Hiring people brings a ton of problems like added expenses, more management, less experimentation, HR overhead, etc.

Here are a few conditions to check before you think of hiring someone, in order of their importance:

1. Have you validated your idea > Product > ICP?

2. Do you have paying customers or at least signed MOUs?

3. Do you have funding or enough runway to afford this expense?

4. Could these abilities be learned by existing people?

5. How critical is hiring this person? Is your startup slowing down without this role?

I have always believed that you should only hire when everyone is throat-choked with work. If that workload is unbalanced, then distribute some workload first before making a hiring decision. Remember, hiring someone is easier than firing them.

Once you are 100% sure, you can proceed to the next question: where to find them.

Where to Find?

To attract worthy candidates, your startup should be an awesome place to work. I call this being a talent magnet. When your startup lacks significant branding, candidates look into the founder's brand. Hence, it's important to showcase that wisely on various platforms. This comes in the form of creating content on topics you have authority on, being part of a community, sharing expertise at events/meetups, and through mentorship and advisory roles. Doing this not only brings the right talent to you but also fulfills the criteria, i.e., the candidate is growth-oriented. Specific to tech startups, there are a few ways to get an abundance of good tech talent:

1. Open Source Contribution: Open source is a great way to find vetted talent by looking at their contributions. Regularly visit GitHub and explore open-source projects relevant to your startup's technologies. Then look for frequent contributors and check their profiles. If they look promising, go ahead and schedule a 1-on-1 conversation.
   

   

   Github contribution could be a great sign but not this desperate tech bro.

2. Public Engagement: Actively look out for people who are engaging publicly through tech talks, social media posts, blogs, newsletters, and other content. These candidates are helpful in compounding your startup's reach through their channels as well and demonstrate a growth mindset. This also means that you need to be active on these platforms as well.

   

3. Hiring Platforms: Startup-specific hiring platforms are another great way to find talent that is interested in startups only. Post your job requirements on platforms like WellFound, YC Startup Portal, EF Job Board.

What to Look For?

Hiring decisions can sometimes lead to life-or-death situations for your startup, so it's important to be extra careful and thoroughly screen candidates. Every headcount should add to the velocity of your startup, not slow it down. The previous step ensures that you have a pre-filter for good candidates. I won't go into the technical details, as it varies based on tech stacks. The following are a few things to look for when hiring a tech candidate:

1. Entrepreneurial: The person should have some knowledge of how startups work and the desire to have a startup of their own someday. A good way to discern this is by asking them what they would do differently at their company. These traits ensure there is a natural understanding of the highly unpredictable and risk-driven nature of startups. They would need to wear multiple hats as there are not people for each dedicated role.

2. Growth Minded: There should be a natural tendency toward growth, not settling down. I respect people who want stability in their lives, but those aren’t the ones who will grow your company. Identifying if someone is growth-minded is not that hard. Just look at their career trajectory and accomplishments. You will know whether the graph is going up or has flattened.

3. Comfortable with Chaos: Building a startup involves constant chaos, and your teammates should be okay with that. Growth comes from chaos. This means things are breaking and building. Your energy should not be spent making everyone comfortable during tense situations, but rather on having people who come up with ways to resolve those issues.

4. Natural Leader: Think of everyone you hire as a vital member of your founding team. Due to their close proximity, they understand your startup the most. They are future leaders of your startup and will lead departments once your startup grows. Hence, look for leadership traits.

5. Ownership: People you hire early should not be just followers but should have a strong voice. They should be able to poke holes in your strategy and suggest better ways to do something. They should stand up and take ownership of things. This trait allows you to focus on other things while having people who will figure out things themselves.

6. Broad Problem-Solving Knowledge: Width of knowledge is more important than depth of knowledge. The ability to create connections over a broad spectrum of things helps in coming up with innovative solutions. Broad knowledge helps you create; deep knowledge helps you optimize. And for an early-stage startup, creation is more important than optimization.

How to Engage?

Once you have found the right person, it's important to test that relationship before calling them a founding member. Engage in an interim contract for 2-3 months with clear deliverables and objectives. Pick an important challenge that your startup is facing and give them ownership of figuring out things on their own. Look at how they do things, not just the outcome. It's important not to show desperation but deliberation in the process. Rely on your gut, and if everything goes well, offer them the role. In terms of compensation, you should insist on a salary plus ESOP model with a vesting schedule. Think of ESOP (Employee Stock Options) not only as a discount code to get a lower price but as an instrument that gets the employee involved in the company's growth and risks. Having this sense of ownership is crucial for having people who will work for the combined growth and success of the company.

Conclusion

Hiring people should not be a company's objective but only the last resort. Getting the right talent is only half the job; sustaining them is the other half. This is ensured not by sending freebies every month but by throwing interesting challenges at them. They should feel the growth in every way possible. Otherwise, they have every reason to switch to another company. As a founder, it's your job to take care of their growth needs. An employee leaving or being fired should be considered a failure for the company. Either you made the wrong decision, or you weren’t able to meet their needs.

I didn’t mentioned anything about diversity, pay grade, location, remote setup etc as I feel all these things just distractions. You can figure everything out if you are successful. The person you hire is the most important thing everything else are just bells and whistles.

Over the years, I have been able to build an attraction circle. With the Build and Scale Talent initiative, I invite growth-hungry talent to join my network of startups.

If you are a startup looking to hire people, let me know how I can help by replying to this or mailing me [email protected] .