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A Guide to Hiring for your Startup
This guide emphasizes that people are the most crucial aspect of a startup, with a focus on strategic hiring practices that prioritize culture and efficiency. It advises founders to remain small and thoughtful about who to hire, advocating for a network-based approach and the careful selection of early hires. Additionally, it underscores the importance of a transparent offer process that includes clear salary and equity structures to attract top talent.
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A Guide to Hiring for your Startup
- 1. A guide to HIRING FORYOUR STARTUP Yevgeniy Brikman
- 2. What is themost important part of a startup?
- 3. a) The idea b)The technology c) The sales and marketing
- 4. a) The idea b)The technology c) The sales and marketing
- 5. People are themost important part of a startup
- 6.
- 7. Therefore, hiring isthe most important thing you do
- 8. Best piece ofstartup hiring advice:
- 9.
- 10.
- 11. Stay small as longas you can
- 12. Build a culture ofleverage and efficiency
- 13.
- 14. Founders spend >25%of their time on hiring
- 15. You must spendthis time wisely
- 16.
- 17.
- 18. based on my experiencesat LinkedIn & TripAdvisor hello-startup.net
- 19. as well as interviewswith developers from many startups: hello-startup.net
- 20. Google, Twitter, Facebook, Stripe, Pinterest,Quora, Coursera, GitHub, and many others. hello-startup.net
- 21. Here’s what I learnedabout hiring
- 22. 1. Who tohire 2. Where to look 3. How to interview
- 23. 1. Who tohire a. Co-founders b. Early hires c. Later hires d. What to look for 2. Where to look
- 24. 1. Who tohire a. Co-founders b. Early hires c. Later hires d. What to look for 2. Where to look
- 25. You need aco-founder
- 26. to fill inyour weaknesses
- 27. to talk youout of bad ideas
- 28. to share thework load
- 29. Two or threefounders works best
- 30. Building a successful startuptakes 10 years
- 31. So be carefulwhen picking a co-founder
- 32. Look for someone you’veworked with before
- 33. College classmates & formerco-workers are ideal
- 34. Split the equityevenly
- 35. Make sure everyone ison a vesting schedule
- 36. Remember, a successful startuptakes 10 years
- 37. You need everyoneto be bought in for the long term
- 38. 1. Who tohire a. Co-founders b. Early hires c. Later hires d. What to look for 2. Where to look
- 39. Early hires are likebringing new DNA into your company
- 40. Choose the first 10employees very carefully...
- 41.
- 42. Airbnb CEO BrianChesky would ask early candidates:
- 43. “If you hada year left to live, would you take this job?”
- 44.
- 45. In the early days, everyone hasto do everything
- 46. “You don't want someone saying that'snot my job” - Julia Grace
- 47. 1. Who tohire a. Co-founders b. Early hires c. Later hires d. What to look for 2. Where to look
- 48. Later stage startups canhire more specialists
- 49.
- 50. Experts at onediscipline (vertical leg of T)
- 51. Broadly skilled atothers (horizontal leg of T)
- 52. 1. Who tohire a. Co-founders b. Early hires c. Later hires d. What to look for 2. Where to look
- 53.
- 54.
- 55.
- 56.
- 57. Can you conversewith them?
- 58. Can you understandtheir writing?
- 59. Can they explain complicatedconcepts?
- 60.
- 61. Similar tastes &appearance is NOT culture fit
- 62.
- 63. Real culture fitis about shared values
- 64. E.g. at Zappos,providing amazing customer service is a core value
- 65. Everyone who ishired answers customer calls
- 66.
- 67. 1. Who tohire 2. Where to look a. Use your network b. Employer branding c. Job boards d. Premature optimization
- 68. 1. Who tohire 2. Where to look a. Use your network b. Employer branding c. Job boards d. Premature optimization
- 69. The majority of startup hiringis via referrals
- 70.
- 71.
- 72.
- 73. 1. Who tohire 2. Where to look a. Use your network b. Employer branding c. Job boards d. Premature optimization
- 74.
- 75. You do thisby sharing valuable content and teaching
- 76.
- 77. 1. Who tohire 2. Where to look a. Use your network b. Employer branding c. Job boards d. Premature optimization
- 78. No one likesjob postings
- 79.
- 80. “Has at least12 years of iOS experience”
- 81. Only active jobseekers look at job postings
- 82. If you just “postand pray”, you only reach 1 out of 5 candidates
- 83. If you’re goingto post jobs, get creative
- 84. And post them in theright places
- 85. Better yet, reach outto candidates directly
- 86. 1. Who tohire 2. Where to look a. Use your network b. Employer branding c. Job boards d. Premature optimization
- 87. Old joke: the boss takeshalf the resumes, throws them in the trash and says...
- 88.
- 89.
- 90.
- 91.
- 92. reject someone for not being a“bro” or a “ninja”
- 93. Instead of looking for reasonsto reject a resume...
- 94. “Look for something that shines” -Gayle Laakmann McDowell
- 95. 1. Who tohire 2. Where to look 3. How to interview a. Interviewing is hard b. Basic interview process c. Interview questions d. Making an offer
- 96. 1. Who tohire 2. Where to look 3. How to interview a. Interviewing is hard b. Basic interview process c. Interview questions d. Making an offer
- 97. You get anhour to make a decision that lasts for years
- 98. 1970’s orchestras: 5% ofmembers are female
- 99. 1990’s orchestras: 35% ofmembers are female
- 100.
- 101. Interviewers will bewrong. Err on the side of no.
- 102. 1. Who tohire 2. Where to look 3. How to interview a. Interviewing is hard b. Basic interview process c. Interview questions d. Making an offer
- 103.
- 104. Email, phone, in-person. Getthem interested.
- 105. Step 2: phonescreen
- 106.
- 107. Use a phone screenas a filter
- 108. Step 3: on-siteinterview
- 109. Aim for 4-8interviewers, each with a different focus:
- 110. communication, culture fit, job-specificskills, closer.
- 111.
- 112. Your goal is learning,not a confession.
- 113. Make sure the interviewers aregood representatives of your company
- 114. 1. Who tohire 2. Where to look 3. How to interview a. Interviewing is hard b. Basic interview process c. Interview questions d. Making an offer
- 115. Puzzles and brain teasers areterrible interview questions
- 116.
- 117.
- 118. Work on real- worldproblems (GitHub, Jawbone)
- 119.
- 120.
- 121.
- 122. Go through a realworkday (Typesafe)
- 123. 1. Who tohire 2. Where to look 3. How to interview a. Interviewing is hard b. Basic interview process c. Interview questions d. Making an offer
- 124.
- 125. What has thisperson accomplished?
- 126. What was itlike working with this person?
- 127. If the reference checksare good, make the offer personally
- 128. Then follow upin writing
- 129. An offer has fourparts
- 130.
- 131. There's work andthere's your life's work. The kind of work that has your fingerprints all over it. The kind of work that you'd never compromise on. That you'd sacrifice a weekend for. You can do that kind of work at Apple. People don't come here to play it safe. They come here to swim in the deep end. They want their work to add up to something. Something big. Something that couldn't happen anywhere else. Welcome to Apple.
- 132. Part 2: thesalary
- 133. Be fair andtransparent
- 134. Use a formula hello-startup.net/resources/salary/ Salary= (job type x seniority x experience) + (location + salary choice)
- 135. Seniority Salary Executive $150,000 Senior$125,000 Junior $100,000 Use a table hello-startup.net/resources/salary/
- 136. Part 3: theequity
- 137. Be fair andtransparent
- 138. Equity = (i- 1) / i Use a formula hello-startup.net/resources/equity/
- 139. Employee Equity Hire #12-3% Hire #2 - 5 1-2% Hire #6 - 15 0.5-1% Use a table hello-startup.net/resources/equity/
- 140.
- 141.
- 142. $1 in benefitscan be worth a lot more than $1 in salary
- 143.
- 144.
- 145. People are themost important part of a startup
- 146. Founders spend >25% oftheir time on hiring
- 147.
- 148.
- 149. Be thoughtful about how youinterview
- 150. Make an offer theycan’t refuse
- 151. Check out Hello, Startup formore info hello-startup.net
- 152.
- 153. Slide 1, Road:Bec Brown Slide 2, Business plan: Heisenberg Media Slide 5, People: Heisenberg Media Slide 8, Four buildings: Davide Ragus Slide 11, Ant: US Dept of Argriculture Slide 13, Helping Hand: Tomas Sobek Slide 21, Handshake: Flazingo Photos Slide 22, Road: Joshua Tree National Park Slide 25, Jobs & Wozniak: Revol Web Slide 29, Schmidt, Brin, Page: Joi Ito Slide 32, Classmates, Travis Rigel Lukas Hornung Slide 34, Scale: Bob Miller Slide 39, DNA: EnzymLogic Slide 42, Brian Chesky: Official Le Web Photos Slide 44, Swiss Army Knife: Wikimedia Slide 48, Tools: Lachland Donald Slide 49, T-shaped person: Valve Slide 53, Brain: Allan Ajifo Slide 56, Tin Cans: Sebastien Wierz Slide 60, Scrabble value: Got Credit Slide 69, InMap: Ali Imam Slide 74, Honey: Thien Gretchen Slide 78, Flyers: Joel Kramer Slide 82, Passive candidates: LinkedIn Slide 83, Billboard: Google Blog Slide 87, Trash can: Sebastien Wiertz Slide 97, Office interview: Weltbild Verlag GmbH Slide 103, Keyboard typing: iloque Slide 105, Phone call: NEC Corporation of America Slide 108, Office: Robert Couse-Baker Slide 111, Chair: Paul Kehrer Slide 115, Puzzle question mark: Horia Varlan Slide 116, Whiteboard: Doc Searls Slide 117, Light bulb: R. Nial Bradshaw Slide 124, Reference call: Martin Cathrae Slide 129, Letter: Bearstache Slide 132, Money: Ervins Strauhmanis Slide 136, Stock certificate: Wystan Slide 140, Ear: Travis Isaacs Slide 152, Questions: Derek Bridges Photo credits
Editor's Notes
- #6 You can take away the idea, the technology, and the sales, and you’d still have a startup; take away the people, and you’d have nothing.
- #7 In many tasks, difference between people is 20% or 30%. In creative tasks like programming, lots of research shows difference are an order of magnitude. Moreover, while 1 bad hire in a 5,000 person company is usually tolerable, 1 bad hire in a 5 person company is a disaster.
- #8 Your company will not be successful until your hiring strategy is successful
- #12 You will never be as efficient as you are when your company is just 3-5 people hacking away all day. Communication overhead increases with the square of the number of people.
- #13 Be proud of accomplishing a lot with a little.
- #14 The key question to ask is not “what can we do if we hire another person” but “what can we NOT do unless we hire another person, no matter how much we try?”
- #15 Imagine you're a team of 2 co-founders and you want to hire 12 people by the end of the year. How much of your time do you think that will take? The answer: nearly 1,000 hours, or almost 20 hours per week.
- #26 Paul Graham has a great blog post called The 18 Mistakes that Kill Startups. Number one on that list is “having a single founder”.
- #29 Startups can be very overwhelming and stressful, but with multiple founders, each one thinks "I can't let my friends down." This is one of the most powerful forces in human nature, and it's missing when there's just one founder. Investors know this, and when they see a solo founder, they not only assume that the founder is unlikely to succeed alone, but also that the founder couldn't convince any friends to join, which is a bad sign and makes fundraising more difficult.
- #30 Easy to split the work and avoid politics. Any more than three leads to more in-fighting and instability.
- #31 Average time from founding a company to a successful “exit” (e.g. IPO or acquisition) is 8 years. Of course, it’s only an “exit” for the investors, and the founders will stick around at least a couple years more after an IPO or acquisition.
- #33 You want a proven relationship and someone you can depend on. You also want someone who is relentlessly resourceful, has a complementary skill set, is in a similar in age/financial situation/motivation, and most importantly, someone you can trust. “Fights between founders” is also on the list of “18 Mistakes that Kill Startups”.
- #34 Friends and especially family are more risky, as you may not have worked with them before and it’s hard to be objective when a personal relationship is on the line. However, someone you know and trust is still better than a total stranger or someone you meet through “founder dating”. Founder dating is about as likely to work out as a drunken shotgun wedding in Vegas.
- #35 Of the top Y Combinator companies, zero of them have a significantly uneven equity split.
- #36 4 years with a 1 year cliff is typical
- #37 So don’t bicker over who-did-what or who-contributed-more in the first few months.
- #41 The co-founders should be involved in all early hiring decisions
- #42 Or even the next 1,000
- #43 Airbnb took 6 months to hire their first employee
- #44 Don’t copy this practice exactly (even Chesky has amended it to “10 years”), but take the underlying lesson to heart: early employees matter.
- #45 AKA “Jack of all Trades” or “Full Stack Developer”.
- #46 Tuning DB queries one day, working on an investor pitch deck the next day, fixing JavaScript code the third day, and ordering office furniture the day after that.
- #47 Julia Grace is the CTO of Tindie. Look for a broad range of experience, and even more importantly, the right attitude. You want somebody who is willing to take on anything.
- #50 This term and image comes from the Valve Handbook for New Employees.
- #52 To become a true expert at one discipline, you typically have to have broad experience in many others. It's similar to how almost all athletes practice not only their sport, but also train strength and conditioning at the gym, as that develops a broad physical fitness that is useful in any sport.
- #54 This phrase comes from Joel Spolsky’s blog post The Guerrilla Guide to Interviewing
- #55 Everything in a startup, and technology in general, is constantly changing, so you need smarts more than knowledge. The kind of smart you want is not about IQ, but about clear thinking and problem solving. Ask the candidate questions about a topic you know deeply. Get them to the point where they don’t know the answer and see if they ask the right questions to go from unknown to known.
- #56 Smart isn’t enough. You’ve probably worked with someone who has never shipped. A startup isn’t about brilliant debates, UML diagrams, or perfect architecture. It’s about building something people want. Ask the candidate to do a deep dive on a project they did and know deeply and have them explain it. When they are done, you should know exactly what they contributed. If they can’t explain that clearly, either they didn’t contribute much, or they are a poor communicator.
- #57 Most of what you do in a startup is communication. Even coding is primarily communicating your intent to other programmers. Good communication skills are often a sign of clear thinking. Therefore, all else being equal, always hire the better communicator.
- #59 Look at their emails, blogs, and code.
- #60 Sergey Brin would ask candidates to teach him something new during the interview. If the candidate owned an important subsystem in your company, could they explain how it works to a new hire? In other words, would this candidate be a good representative of your company in the office, at interviews, and at conferences?
- #61 You’re going to spend at least half of your waking hours at this startup. Are you sure you want to spend it with this person? Some companies call this the “no assholes rule”.
- #62 A San Francisco company proudly blogged how a candidate failed their “go out for a beer test” because he was wearing a suit. That is not culture fit.
- #64 Liking beer or disliking suits is not a “value”. Company core values are not fickle preferences or strategies. They are something that endure no matter what the company is building and even if the market would punish the company for holding those values.
- #65 See Deliver WOW Through Service.
- #70 Almost 100% of hires at successful early stage startups come through referrals: someone the founders know, or someone the investors know, or someone the early employees know.
- #71 An average of 29 days for referrals versus 45 days for career sites.
- #72 Referrals have a 45% retention after two years, compared to 20% from job boards
- #73 You can find them by talking to your friends, colleagues, and family; by crawling your LinkedIn, Twitter, GitHub, and Facebook networks; by attending or hosting conferences, meetups, and hackathons. And you need to incentivize everyone at the company to do the same by offering cash, prizes, and/or recognition for each referral. As the company gets bigger, the percentage of hires from referrals drops, but it should never drop below 40-50%. If it does, it may mean you’re not incentivizing referrals enough, or, even worse, that employees don’t like the company enough to recommend it to their friends.
- #75 In the marketing world, “outbound marketing” is where you send your message out to customers (e.g. through advertising), whereas “inbound marketing” is where you bring customers in to you by offering them something valuable (like honey).
- #77 This content should not be trying to overtly hire people. It’s content that’s valuable and high quality in its own regard. A blog post that teaches programmers how to do something is good; a recruiting video is not. Teach your audience and they will see you as an expert in the field and be more likely to buy your products or join your company. You should setup a corporate blog and social media accounts, but be sure to also encourage each employee to create their own individual brand with personal blogs, talks, and social media accounts.
- #80 “Results oriented? Oh well, I guess I can’t apply.” said no one ever.
- #81 The “me monster”: the company lists all its requirements and its wants, but completely forgets to tell the candidate why they should apply to the job in the first place.
- #83 Most programmers I know applied to just one job in their entire life, and that was coming out of college. After that, they’ve never seen a single job post, and just get offers when someone reaches out to them (e.g. referrals).
- #84 Make your job posting standout. Think of it like an ad and focus on why the candidate should apply. See Your Job Posting Sucks for inspiration.
- #85 See http://www.hello-startup.net/resources/jobs/
- #86 The best way to use job boards (like LinkedIn, StackOverflow, and GitHub) is not to passively post a job and hope someone finds it, but to actively find the candidates, and reach out to them to see if they are interested.
- #91 Unless you’re hiring copy editors.
- #92 Google crunched the data on their hiring and found that GPAs and test scores are worthless at predicting job performance. This logic applies for most “job requirements” people list, such as “12 years of iOS experience”. You’re just throwing resumes away.
- #93 Actual job ad: "Want to bro down and crush some code? <Redacted> is hiring." Looking for “ninjas”, “rock stars”, and “bros”, is a great way to throw away a huge number of resumes.
- #94 People are remarkably bad at writing resumes. Many people you’ve rejected for not having “XXX” on their resume may have actually done “XXX”, but not known that it was a good idea to include on the resume. Engineers are particularly bad at this. Resume writing skills probably do not correlate with job performance.
- #95 Gayle is the founder of CareerCup and the author of “Cracking the Coding Interview”, “Cracking the PM Interview”, and many other books on hiring.
- #98 It’s very hard to get a sufficient signal from such a short time and from an artificial, high-stress setting. This is one of the reasons referrals are so useful, as real-world experience with someone is a much stronger signal than an artificial interview.
- #101 Another disturbing example was a study of parole judges that found that a prisoner's odds of being granted parole were significantly affected by the time of day of their parole hearing. The odds start at around 65% in the morning, gradually drop to nearly 0% just before noon, and then jump back to 65% after lunch. The judges' stomachs were more important in parole decisions than any of the evidence presented.
- #102 Maintain a very high bar. It’s very costly to fix a hiring mistake, so it’s better to occasionally reject a good candidate than to occasionally hire a bad one. Look for a strong “yes” from every interviewer--look for something that shines brightly.
- #105 Talk about your company’s mission and values. Tell about what you’re building and the opportunity that’s available. The interview is a two way process: while you’re interviewing the candidate, they are interviewing you. Make a good impression as often as you can so that when you finally find someone worth hiring, they want to join you.
- #106 1-3 phone screens is typical
- #107 Especially in terms of time
- #108 Make sure the candidate has a chance of passing the on-site interview before you spend the time and money to bring them in. Ideally, most people you end up bringing on-site get offers because you have an effective phone screen process.
- #110 Having more interviewers reduces the odds of making a bad decision because one interviewer had a bad day or was biased.
- #111 The closer should tell the candidate about the job (you may want to prepare a demo, slide deck, video, etc), show them around the office, take them to lunch, and get them excited about the company’s mission. Remember, while you are interviewing them, they are interviewing you.
- #114 Consider carving out time for interviews, making them an inherent part of the job, and rewarding interviewers so that employees are excited about doing it rather than seeing it as a chore. To build a great product, you polish every part of the design; to build a great company, you need to polish every part of the hiring process.
- #116 Google did the research and found brain teasers have no value other than making the interviewer feel smart.
- #117 The industry standard for a technical interview is to ask the candidate to work on a CS 101 data structures and algorithms problem, come up with the whole solution up front (instead of iteratively) while thinking out loud, and then to write it by hand on a whiteboard with no syntax highlighting, no auto-complete, no google, no StackOverflow, no compiler, no open source libraries, no documentation, no tests, and no easy way to refactor. Premature optimization is the root of all evil, but not in interviews, where we force the candidate to optimize the hell out of individual code paths with no profiling and usually at the cost of clarity and simplicity. If someone wrote code like this in the real world, you’d fire them. So why do we interview this way?
- #119 GitHub has the candidate work on one of the company’s open source projects. At Jawbone, they give data science candidates a data set and 3 hours to explore it and come up with interesting findings.
- #120 Have the candidate do a 10-15 minute presentation in front of the team and then answer questions. It gives the candidate an opportunity to discuss a project they worked on in-depth, to demonstrate their communication skills, and to communicate with many members of the company in a short time.
- #121 This can be used as a filter before the phone screen, and then you can discuss the code the candidate writes during the phone screen.
- #122 The candidate gets to code in their natural environment.
- #123 Typesafe brings in candidates for 1-2 days and gives them a laptop, has them check out the real code, go to meetings, work with a mentor, go to lunch, and so on. You get to see the candidate in a real-world setting and they get to see what the job is really like.
- #127 Is the candidate smart and do they know how to get things done? Are they a good communicator? Would you want to work with them again? Were they in the top 1% of people you’ve worked with? Top 10%? 50%?
- #128 Handing them an offer in-person is the best, but if that’s not practical, then make the offer over the phone. This is another opportunity to get the candidate excited about the company and its mission.
- #129 And follow up periodically after that while you wait for a response. For example, while I was thinking about TripAdvisor’s job offer, they sent me a nice care package with a TripAdvisor hoodie and a nice note. It probably didn’t cost them much, but it made a big impression on me, and I still remember it to this day.
- #131 Yup, yet one more time you need to remind the candidate why they should be joining your company. The opportunity--a chance to take on the company’s mission and work with amazing people--is the most important part of the offer.
- #132 Would you rather see something like this or a boring-looking legal document?
- #134 Your goal is to take salary off the table as a concern by making a fair offer. The best way to make it seem fair is to be transparent at how you got the number.
- #135 This is the formula from a startup called Buffer that is so transparent that they revealed all of their salary information to the public. You can use online salary calculators to find a reasonable baseline for each job type.
- #137 Most startups can’t compete with big companies on salary, so you have to make up for it with equity.
- #138 Once again, you want to build trust, and to make employees feel like they are being treated equally. The best way to do that is through transparency.
- #139 In this formula, i is a percentage that represents how much the company’s value will increase if you hire this person. You should be willing to give someone 5% of the company if you believe the 95% you have left will be worth more than the original 100% after this person joins. Of course, you also need to factor in their salary, and to make sure you that you more than break even, but this is a good starting point. See The Equity Equation for more info.
- #142 A job is a huge life decision that affects the candidate’s family, career, lifestyle, what they do for half their waking hours, and much more. Listen carefully to the candidate to find out what it would take to make them comfortable with this decision.
- #146 The differences between people are huge, each person matters more in a tiny startup, and therefore, hiring is the most important thing you do.
- #147 Hiring is incredibly time consuming. Make sure you learn to do it efficiently.
- #148 Referrals should be your first go-to for efficient hiring
- #149 After referrals, your second priority should be to build a strong brand. Anything else, such as job postings, are a distant third.
- #150 Make sure your interviews give you enough signal to make good decisions; make sure your interviews give the candidate a great experience too.
- #151 Focus on the opportunity. Listen to the candidate. Be fair and transparent.