Hiring for startups, especially in the early days, is less about trying to fill the traditional functional roles common to other types and stages of typical businesses, and more about de-risking until you achieve product-market fit.
As a founder, there’s a tendency to think back to what roles you’re used to seeing in other companies or at a previous job. In mature, traditional businesses, you’ll typically see several clear functional roles and teams: finance, marketing, sales, and so on. In an early-stage startup, things are going to look different.
Balancing Risk and Skill Sets
Instead of traditional roles, what you want to think about are the jobs that need to be done to reduce your risk of failure.
For example, a founder who is a software developer is already bringing a specialized skill set to the table. So, their initial, “team composition” would be less likely to be developer-focused. They might benefit more from adding a great designer to their team to help think through how the product should look and feel.
Now, you’re not just thinking about hiring for a role; you’re thinking about getting a job done.
Needed skill sets can be temporary or permanent, and the right decision for your early-stage startup depends on the risks you’re currently trying to mitigate.
Outsourcing is an option, but be sure to keep the risk you’re trying to reduce top of mind – that’s the most important thing. If you’re technical and looking for marketing skills, but think you can pick up the necessary skill set to get the work done in the earliest days, that would be less risky than a new marketing hire.
Your end goal should be to replace yourself eventually with great technical talent and have the focus be on founder-led sales efforts and talking to more customers.
A common misconception is that your biggest risk is, “Can I build this?” In reality, it’s more likely to be, “Can I sell this?”.
Part of the beauty of a venture studio such as HVL is that the structure allows founders to focus on their biggest risk areas because they have other skill sets available to them within our shared service ecosystem for design, go-to-market strategy, product, etc.
If an EIR or CEO has excellent marketing skills, for example, they can run with marketing. They may be less dependent on HVL in that department and more dependent on other areas where they need more help.
Over time, as the process works itself out, founders can start thinking more about building out functional areas of the business for the next stage of growth.
When to Hire
A key part of knowing what’s next in terms of skill acquisition within a startup is talking with others who have been where you are. Read and gather knowledge about where you think you should be by a certain point in time. If you’re not gaining noticeable momentum, you probably need to look at who is helping you try to get there.
You should have product momentum that matches market and customer demand for your stage. If you’re not building and releasing features and updates with momentum, it might be time to check your technical team.
If you don’t know why you’re not getting momentum, you should find people you can talk with to gather new insights. You may find out the reason people aren’t buying your product isn’t that you haven’t built a great product – it could be because you haven’t positioned it right in the market.
Continuously adding more features when the problem is positioning is a waste of time and a recipe for failure. You’ll find you could’ve saved yourself a lot of time by modifying your positioning instead of building more features.
Mistakes to Avoid
A prevalent early hiring mistake is building out a sales team right out of the gate. There are always exceptions to the rule, but most startups are likely not the exception. The co-founding team will be critical to the sales process in the early days, and you should take your time hiring for this role.
Be very involved in early sales. It will help you get information from your customers about the product, including valuable insights into how to position it in the market.
It’s true that you can’t scale without people, but you won’t scale with the wrong people.
Depending on what you’re building, your margin for hiring error may be very small. I always recommend that the initial hires be through your network. That way, they’re people you can vet or have vetted, and you’ll have some confidence that they can get the job done.
If you’re not able to do that and you’re hiring through UpWork or something similar, then you should have a thorough validation process in place. But don’t drag your process out – when you see red flags, it’s time to stop and move forward to the next one.
If you have questions about your startup or venture, consider scheduling an Office Hours session with one of HVL’s experts. They’ve been where you are and are ready to help with actionable insights and advice. Or if you want to hear more from HVL, you can join our mailing list here.