A Beginner’s Guide to Hiring & Recruiting

Getting a startup off the ground takes a lot of planning, and hiring for your startup is no different.

Roles and work arrangements in early-stage startups can be more fluid and can involve ‘wearing many hats,” which can favor employees with general skills who are fast learners.

But, as your company progresses to launch and beyond, it is important to define the roles of employees within your startup, identify the skills your company needs and make hires for the roles that are critical to your company’s success.

No matter how helpful a contractor or employee was in the launch of the company, there needs to be a reason that they’re on payroll other than “time served” and, as painful as it can be, it’s important to evaluate the role that everyone in your fledgling company is playing as your startup gains momentum.

Startup Salary Guide

When budgeting for the hires you want to make, you need to be sure that you are offering competitive salaries for your area, or at least salaries that are acceptable to someone with the level of experience you want to hire.

Some entry-level positions will not require you to pay a salary that is above the average for your area, but other, more specialized and senior roles may require you to invest in competitive compensation to get the level of experience you’re looking for.

To get the talent you want for your startup, you will need to provide people with payment that is meaningful, if not competitive for the city where you operate.

You can use Glassdoor to see the average salaries for the position you’re offering in your area, the salary range for your area and the compensation that specific competitors are offering for different roles.

Successfully launching will depend on your hard work, but you will also need the hard work of skilled employees to succeed. Hiring the right person at the right time won’t be possible if you aren’t offering an appropriate salary, so budget accordingly when raising funds for your startup.

[Related: Glassdoor’s Guide to Salary Conversations]

Equity and Exit Strategy

One of the big appeals of working for a startup is the prospect of “getting in on the ground floor” and obtaining equity in a company before that company becomes tremendously valuable.

Compensating employees with equity sharing is a common practice at startups, but it’s important to consider the long-term strategy of your company before you decide how much of your company’s stock will be devoted to an employee pool.

For instance, if your plan is for your startup to be acquired by a larger company, it is crucial that you maintain as much equity open for sale in your company as possible to maximize your valuation at time of acquisition.

Important Roles for Startups

When creating your startup hiring plan, it’s important to identify all positions required for each stage of your company’s launch and beyond.

It’s also important to identify positions that are critical for operations, product development and other company functions that will be key to your startup’s success in different stages of your launch and post-launch operations.

Answering these questions will help you identify positions that HAVE to be filled with talented, experienced people.

  • Which skills will be most in-demand prior to launch?
    • Which skills will be most directly tied to launching on time?
    • Which positions vacancies would be most disastrous for the launch of your product if current employees quit unexpectedly?
  • Which skills will be most in-demand after launch?
    • Which roles and skills will be required for successful post-launch product development, sales, marketing, finances and other essential company operations?
  • Which roles are directly related to revenue generation at each stage of your startup’s launch plan?
    • How soon does your company need to start generating revenue post-launch?
    • How much of your business plan will be funded by outside investors vs internal revenue generation?

[Related: Startup Recruiting — How to Build Your Employer Brand & Attract Top Talent]

Product Development / R&D

Product development and R&D have a way of taking longer than you expect, and this is especially true if you don’t have a solid hiring plan in place for this critical company function.

The specific product development / R&D hires your startup needs will depend on the products your company is creating, but no matter what you’re developing, you should identify the skills required at each stage of your product’s development and the number of employees required to meet deadlines.

It can also pay off to have backup candidates for your Dev / R&D teams, especially if these teams are small or rely on a few skilled individuals to ensure your product reaches your target launch date. Having relationships with talented professionals for key positions will ensure that you are covered in the event that a critical employee burns out or takes another job.

Managers

As your company grows, managers will become more important for ensuring the effectiveness of teams and operations.

You need managers who you can rely on to drive results as your team grows and who can be relied on to ensure that critical goals are reached as your company launches and beyond.

You also need people whose character you can trust, as the numerous startup scandals in the news can demonstrate. Managers are in positions of power, and they need to be trustworthy enough to use this power effectively and responsibly.

You will need to hire new managers from outside of your company, but you should not forget the positive effect that promotions to managers from within your company will have on morale and retention.

Sales

You may be able to get away with fewer sales professionals on payroll in the beginning, but it is in your best interest to have an effective sales team when you launch.

The sales talent you need will depend on the product or service your company sells, and so will the experience level of your sales talent.

While entry-level salespeople can be trained, the people who you hire for senior sales roles should have a good deal of experience in your industry and, ideally, experience selling a product or service that is analogous to yours.

[Related: The Dos and Don’ts of Hiring a Great Salesperson]

Marketing

The best way to plan marketing hires is around the messaging and branding requirements for different stages of your startup’s launch.

Your marketing hires will be finalizing the branding and messaging for your company, launching your company’s website, creating ads, creating online content, creating target customer profiles and creating other key assets that will help bring your startup from unknown underdog to industry innovator.

The last thing you want is for a key asset, such as your website, to be behind schedule or visually unappealing, so be sure to identify your needs for each stage of your startup’s launch and the skills required to meet these needs.

Finance Positions

Often times, the finances of startups are managed by founders or other individuals within the company involved with funding acquisition operations. However, as your company launches, it is essential that you hire finance professionals.

When hiring for finance positions, you should pick professionals who have experience doing bookkeeping and other finance functions for a company of your size and in your industry. It’s also important to account for growth, and to recognize the experience limitations of your initial finance hires when your company expands and your financial needs become more complex.

Hiring at startups can be a challenge, but it can also be incredibly rewarding. After all, it helps you set the stage for a great company culture, operational excellence and success for years to come.

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