Wherever you are in the startup growth cycle, you should be thinking about your next
beers hires. Seriously though, whether you have 10 employees or 100, every new employee you recruit in the early stages will have a crucial impact on both your company culture and your bottom line.
For the second year in a row, First Round’s 2016 State of Startups report found that “hiring good people” is the number one concern of startups, beating both customer acquisition and revenue growth.
Ultimately, it’s the people who make up the company that determine whether it’s a success. So you should be thinking about your recruitment and HR processes, values and goals from the very first hire.
Here are the top 5 reasons your startup needs a dedicated recruitment team.
1. Hiring is time consuming
“Hiring is always extraordinarily challenging, time consuming, and mentally draining. In small companies resources are scarce, and the process usually involves removing someone from their core competency in order to focus on getting people in the door.”
Without a dedicated HR or recruitment manager, employees who spend time recruiting are being taken away from their day jobs. Hiring the right candidates is incredibly time consuming, particularly when startups require developers with specific technical experience.
It’s easy to underestimate the time it takes to meet and vet candidates, check references and negotiate on salary. Rushing any stage of the process can result in poor hiring decisions and unhappy workers, which will immediately put a new startup at a disadvantage with competitors.
Not only will a dedicated recruiter relieve overstretched and over-worked employees, but they will drastically cut down the time it takes to hire. Formal processes and procedures = increased efficiency = less time spent recruiting.
2. CTOs and CEOs aren’t good recruiters
“You probably wouldn’t let your head of marketing try out coding because you are short on devs, so why would you have your CTO handle recruiting alone? Getting a recruiter ensures you have a constant source of new candidates.”
We hate to be the ones to say it, but CEOs and CTOs aren’t necessarily the best people to be left in charge of recruitment!
In the early days, startup founders have full control over the process, handpicking the perfect candidates and reeling them in with a mixture of long-term stock options and heady idealism. Gut feeling and intuition rules the roost. There’s probably not a hiring or HR process in sight…
So it can be hard to adjust to the idea of putting a dedicated employee in charge of HR and recruitment, let alone a whole team! But once a startup grows beyond the first few hires, it's no longer tenable (or desirable) for the senior management team to be responsible for the recruitment process.
Hiring is a science, and carrying out interviews, assessing the market and analysing existing gaps in the team's knowledge are invaluable skills that won't necessarily come naturally to CEOs and CTOs. To preserve senior employees’ sanity, free-up their time and streamline and improve the recruitment process, delegate.
3. Good hires = a good candidate pipeline
“With a high volume of high-quality candidates, managers no longer have to settle for “butts and chairs” hiring.”
Sometimes a good hire appears overnight. Especially at the beginning of the startup cycle, when hires tend to be referrals, previous colleagues and long-forgotten contacts. But once immediate networks have been exhausted, and the requirements of new roles become more focused and specific, a candidate pipeline is absolutely essential.
Tapping informal networks doesn’t scale, and relying solely on inbound leads can lead to second class candidates. The best developers aren’t looking, so they won’t respond to your job posting.
Take it from us - a solid candidate pipeline takes time and effort to build and maintain. Generating candidate flow, carrying out interviews and vetting potential new hires is time consuming. So having a ready-made, go-to list of awesome developers makes life a hell of lot easier!
As well as improving acceptance rates and hiring times, a great pipeline also improves employee satisfaction and retention, as new hires are already invested in the company and have had time to consider the role and commit to their decision.
4. It’s hard to attract the best candidates
“When it comes to attracting talent, I am facing the same challenge as everyone: finding developers and technical people for our teams. Nowadays there are many options for a software developer who wants to change his/her job - lots of new startups doing amazing things and closing huge investment rounds.”
We hate to be the ones to break this to you, but attracting great talent is hard. The acute shortage of IT specialists, coupled with the insatiable demand for their skills, is making it hard for everyone to recruit great developers. It’s particularly difficult for new startups who are still finding their feet and cornering their area of the market.
Beating the tech giants on pay or benefits is near-impossible, so building and maintaining an attractive brand and employee proposition should be a key priority. And that doesn’t just mean asking your marketing guru to shout about your product from the rooftops.
According to Universum, CEOs believe that by 2020, the main goal of company branding will be securing long-term recruitment. A robust employer presence is more important than ever for businesses looking to secure and retain key talent.
- For more information on employer branding and recruitment, head over to the The Digital Marketing Institute's blog post on the topic. -
Market competition also makes closing candidates more difficult. Without an individual who has experience in - and time to dedicate to - making counter-offers and building tailored benefits and salary packages, you risk losing a candidate right at the end of the process. A recruitment manager can also alleviate the tough back and forth between candidates and senior management - helping avoid bad feelings after a particularly tough negotiation!
5. You need a consistent company culture
“Early hiring sets the trajectory for a company. The first 5–10 hires at a startup establishes the bar on quality and culture. Once that bar is set, change is difficult.”
If you haven’t yet created a coherent company vision and set of values for your team to live and die by, do it now. The most successful companies have strong corporate cultures and are, to put it simply, great places to work.
Make one wrong hire in a small startup and you risk upsetting the balance of the office and radically changing the direction of the company.
In a large startup, when new developers are no longer being handpicked by the CEO, it is increasingly difficult to hire new employees who match the culture and seamlessly blend into the team. Maintaining a great workplace environment during a period of growth takes dedication, time and effort, as well as consistent hiring processes and strategies.
Looking for more startup recruitment tips? We’ve compiled the ultimate list of dos and don’ts when growing a startup.
2. Not 100% sure that fairies don’t exist
3. Looks at every dog in the street as if she’s going to kidnap it
4. Only learned how to open a bottle of wine at 25
5. Could be a pro bumper car driver, but isn’t in it for the money