What You Learn Working in Early-stage SaaS Startups
Looking back at my last five years with two Atlanta software-as-a-service (SaaS) startups, I feel like I could write a heavy book about everything I’ve learned. It would be impossible to fit everything on a single page, but I’ve decided that it’s time to put some things in writing.
I hope something here will help you. Maybe you can learn from my mistakes.
Let’s start with the foundation and work towards what you need to know as you grow.
Know Who You Want to Help
One of my favorite startup veterans told me, “First, decide who you want to help. Once you know your target audience, you can start to build a business based on the problems those people need to solve.” This way, if the problem changes or goes away, you can always pivot to solve other problems that those people need to solve. You won’t have to start over building new relationships from scratch.
Use Cases Before Personas
We spend a lot of time constructing detailed personas. What industry does this person work in? What’s their job title? What kind of pasta sauce do they prefer?
Personas guide key messages, content, and product experiences, but they’ll never be perfect. Your users belong to a cohesive audience, but they’re all special snowflakes. Look for use cases (the problems people are trying to solve) and flesh out personas from there. It’s easier than doing it the other way around.
The Mission Matters
Why does your company do what it does? Every single person on your team needs to be able to articulate the mission of the company, not just the plan for how you’re going to hit your revenue goal this quarter. Some smart people skip this part or don’t articulate their missions clearly because they assume they don’t have to. Indulge in a little idealism. Pick the right words. Repeat them until they stick.
Your Value Prop Is How Your Mission Helps People
How does your company make life better for people? Does it improve a workflow? Does it make a job easier to do? How will that impact your user or your customer’s bottom line? Make sure everyone at your company can repeat this back to you. Slap it somewhere prominent on your website.
Use Resources Wisely
It’s easy to blow your budget on overhead, expensive events, fancy meals, and Lyft rides charged to the company card. You will see other startup founders living large and feel pressured to do the same.
Ignore them. Or, assume that they were independently wealthy before starting their companies.
Work remotely or out of a closet until you absolutely need somewhere to bring prospective clients. Always be outgrowing your office space.
If you do decide to move into a co-working space, don’t treat it like an office. The value of a co-working space isn’t just the shared expenses and the free coffee; it’s the community and the engineered serendipity that comes from sheer physical proximity. If you’re not bartering services with the other SaaS startups in your space, you’re missing out on opportunities for advice, valuable input, and advocate marketing.
Watch Your Variable Costs for Specific Product Features
Do you know how much it costs to run a specific feature? At scale? Figure it out. Make sure everyone on your team knows. Otherwise, you risk discounting below the cost of the feature and losing money offering the service.
Watch out for tools that sound cheap but charge per seat. They work great with small teams, but they get costly as you grow. No one likes to share a seat after they’ve had it to themselves, so if you’re planning to share it in the future, set up the username up with an email address like “firstname.lastname@example.org.”
Speaking of logins…
Use LastPass or Something Similar
It’s good for security and makes life easier. Stop wasting time with those ‘Forgot Password?’ links.
Funding for Founders
Taking on Personal Risk
When you start a company, you’re taking on a huge financial risk. My friends who are founders stay hush-hush about the specific numbers and how they’re making it work, but I have pieced together that lots of founders are paying themselves next to nothing or operating on “friends and family money.” If your friends and family don’t have any money, prepare personal savings and plan to adjust your lifestyle.
Debt-models vs. Venture Capital
If you have predictable cash flow, you don’t have to take venture capital. You’ll grow slower, but you’ll retain more control over the organization. You can partner with individual investors to secure increments of cash as needed. Eventually, when you have enough revenue, you can apply for a line of credit to grow faster.
If You Take Money, Know How You’ll Spend It
How many times have you seen a startup with a questionable revenue model blow up only to announce layoffs a year later? I haven’t been on the inside of this yet, but I suspect that this happens when people take more money than they know what to do with. If you’re taking large amounts of cash, you need a plan to put it to work.
Define Values Early; Practice Them Often
Articulate your personal core values. As soon as your company has more than one employee, identify your common core values and write them down. Having defined values will help you attract great talent and stay aligned as your team grows. It’s hard work to enforce values after you’ve built out your team, so start early. Keep core values close and practice them when making daily decisions.
Know How to Celebrate Without Booze
Bar carts. Beer fridges. Open bars. Kegs on every floor. Champagne toasts. Bloodies and mimosas over brunch. Pitchers of margs over lunch. Happy hours with the squad.
Practicing moderate, healthy alcohol consumption can be super challenging when there’s always something to celebrate. Between parties for company milestones, networking events, monthly meetups, and “I need a beer because <insert stressful work problem here>” it’s easy to get out of hand at the office.
Startup life didn’t cause my drinking problem (it was already there), but it did make it harder to keep under control. If I could do the last 5 years over, I would practice celebrating without booze.
- Surprise half day! Everyone wrap up urgent stuff and go home early.
- Field trip. See a local attraction or take a trip to an art museum.
- Upgrade your tech. “How long has your computer display been doing that static-y thing?”
- Announce new perks. What’s one thing the company could do to make your life better today?
Speaking of perks…
Startup perks are tricky business. They attract new talent. They may make current talent happier. And, they may make more conservative employees feel like you’re wasting money that could be in their paychecks instead. Be transparent about the cost of perks and why you’re providing them.
Once you introduce a perk, it hurts to take it back. Make sure that you have resources to provide the perk to new employees at scale.
Personal favorite perks:
- Free parking passes. Sounds boring and basic, but when your company’s building has limited parking and nearby lots have strict hours, the freedom to come and go as you please is the most prestigious luxury.
- Monthly housecleaning. Domestic labor is real. It’s like having a whole other unpaid job on top of your day job — which is already more than a normal job because it’s a startup. One of my personal goals was to “make enough money that I could pay someone to clean my ceiling fans” but as I made more money, I never prioritized this in my budget. A company perk made it easy for me to book cleanings. I was so happy that I cried.
- Work from anywhere. Remote work is the best. Atlanta traffic is the worst. If your company needs someone to be physically present in the office to do their job well, prepare to pay them $5,000 more a year to cover their automotive expenses, a working wardrobe, and time that they can never get back because we’re all going to die.
Speaking of remote work…
Remote-first Scales Better Than Remote-friendly
Yes — some work feels better in person. Video conferences are glitchy and kludgy. There’s nuance in body language that gets lost in conversations on the phone or via Slack. That feeling when you have your people in a room throwing ideas at a whiteboard is pure magic. Sometimes it feels so magical than you let it run on for four hours until someone says, “Holy crap. I forgot to eat lunch and I didn’t get anything done today.”
At some point, you’re going to need to accommodate remote workers without treating them like second-class citizens. Not everyone is a culture-fit for a remote-first company, and that’s okay. If part of your business plan is to grow to a 50 or 150 or 10,000 person company, implement a remote-first culture early. You’ll be more efficient and everyone will feel like they’re on equal footing.
Here are two awesome blog posts about how and why to do that well:
Speaking of equal footing…
Transparency Builds Trust
Transparency means making information available to everyone on the team. It’s the foundation of trust, teamwork, and innovation.
100% transparency isn’t possible. Some personal information must be confidential between employees and managers. But, most information about financials, business goals, and hiring plans should be shared without concern. If you’re keeping something a secret, ask yourself “Why?” five times.
I could go on and on about this because transparency is one of my personal core values, but Joel at Buffer totally nailed it, so read his blog post about defaulting to transparency if you need further convincing.
Safe, Supportive Workplaces
While I’m grateful that I’ve never experienced overt sexism or discrimination at a startup, I often hear things that make me uncomfortable, angry, and less trusting of my friends.
microaggressions: plural noun, those little things that people say off-hand that get under your skin and you wonder if it’s even worth calling it out but if you don’t call it out then you can’t stop thinking about it and later you wish you’d stood up for your damn self.
If you hear something, say something. This isn’t just about letting someone know how you feel. It’s about building a supportive, positive culture for other people on your team, too.
If you get called out, acknowledge it, apologize, and change your behavior. Nobody’s perfect and we’re all learning. If someone else feels threatened or discriminated against, it’s not about who’s right and who’s wrong. Their feelings are real and valid. Convincing them otherwise won’t earn their respect.
Validate Ideas with Users and Prospects
Early-on, you will build features or products specifically to meet the needs of literally anyone who will give you any money. That’s okay. Build it and know that you might kill it later.
As you grow, it’s important to do more research to validate ideas for new features with your existing customers and prospective customers. Take down specs and use low-fidelity mock-ups to test your ideas with people before you build them.
Maintain Your Idea Exchange
Public-facing idea exchanges, like UserVoice feedback forums, are fantastic for letting people know that you care about user-driven development. You don’t have to build every feature that’s requested, but you should reply to every post. If you don’t, users will think your Idea Exchange is a “black hole” and they’ll start hitting up support instead.
Treat replies on user forums like you’d treat social media messages from your company’s brand. Respond quickly. Keep it professional. Proofread before sending. Take follow-up questions offline. Your user idea forum isn’t the place to ask questions and probe for clarity. Reach out via email or book a meeting to continue the conversation.
Be Vague About Timelines
If you publish a release date for a new feature, you’ll make a liar out of yourself. Do your best to estimate timelines and share rough estimates with customers who ask for them, but never commit to a release date. Things come up. The app could burn to the ground. Your best engineer could get hit by a bus. (Seriously. People die, y’all. It totally sucks.)
“Based on our current roadmap and resources, it seems like this feature may be available some time before the end of Q4” is safer than “We’re launching this new feature on October 1st.”
Build Web Performance Into Your Success Criteria
New features won’t sing if they’re slow. If your new dashboard has all of the bells and whistles but it takes more than 2 seconds to load, does it even matter? Include performance goals for speed and reliability when you’re designing new features.
UI / UX Design
Invest in Visual Design
A CEO that I know got his company off the ground with hundreds of users before he ever sent out a press release. His app looked great and people believed it would work. Visual design impacts how people perceive the reliability and value of your product. Thoughtful web and graphic design encourage trust in your brand.
Keep It Simple
Every extra word, icon, and form field contributes to clutter. When designing UI elements for new features, make it a game to see how little you can add.
Great Design Begets Less Technical Documentation
When we write technical documentation, we go over the top to explain every component of the feature. This is a great exercise. But, if your technical documentation for a new feature requires a ton of instructions about how to use it, step back.
Why do we need to explain how this works? Could we make this more intuitive?
Copy Competitors Conservatively
When you’re designing new features similar to what your competitor has already rolled out, there’s nothing wrong with doing your research. You don’t have to reinvent the wheel.
For example, it’s smart to use similar words and labeling. Someone comparing you to a competitor will know right away that you both have that feature. They can check the box on their list faster.
But, when a user or a member of your team asks, “Why did you do it that way?” if the only answer you can offer is, “That’s how <our biggest competitor> did it” then you’re being lazy. Know why you picked this particular design direction instead of other options. Be able to communicate that clearly to your team and your users.
Placeholders Are Not Labels
If you’re tight on space for form fields, use a float label so people remember what they’re supposed to put into the field. It’s hard to remember what the field needs while you’re also typing.
“Oh, come on. It’s not that hard.”
Yes, it is. Recently I submitted an inbound form that was looking for “Email” and “Name.” Out of habit, I typed my email and my password and hit enter.
“Whelp. Seems like as good a time as any to go update my LastPass password…”
Never Assume There Will Be Wi-fi
Offices don’t always have accessible wi-fi connections; know how to demo your app with .pdf slides.
Take All Your Cords, Adapters, and Portable Chargers
No one will have a USB input compatible with your computer and your laptop will die.
Get to the Airport So Early That It Seems Silly
Departure times printed on tickets refer to when the plane will be taking off the ground, not when you need to show up to get on the plane. People who travel often know this, but I didn’t travel often before working with startups. I learned this lesson the hard way and missed a flight for an on-site meeting with a new customer in New York. When the customer eventually churned, they said it was because of a product feature, but I can’t help wondering if it would have gone a different way if I’d started the relationship on the right foot.
Double-check Addresses and Routes
Big Enterprise companies have multiple offices, sometimes multiple offices in the same city. Double-check the address and the floor. I can’t tell you how many times I thought I was going to be comfortably early for a meeting and ended up running to get across town in heels. (It was six times).
Get Personal With Prospects
The best sales reps on my team were close with their favorite buyers. From WhatsApp to SnapChat, no channel was off limits. I thought it was weird and totally unprofessional until I started going on-site with my reps. When we rolled into a new town to meet a client, they treated us like old friends. They took us to their favorite restaurants. They gave us genuine, scathing suggestions that we needed to grow.
Source Your Own Deals
Yes — marketing inbounds will come in. And, if you’re working with a sales or business development team, they’ll help source deals, too. But, at the end of the day, if you can’t do your job because you’re sitting around waiting for a qualified lead to come in, you’re not going to be successful selling at a startup. Take control of your destiny. Start prospecting your dream deals.
Know Expectations Before Presentations
Some companies hate slide-decks. Others require them. Let your contacts know what to expect from a demo and make sure it aligns with their needs.
“I typically start by asking questions to understand your goals and then jump into a live demo of the app. Will this work for you? Or, should we prepare something more formal for your team?”
Publish Your Pricing
Excellent sales reps can spin a $100,000 deal into a $300,000 deal by understanding a company’s budget and presenting a package that provides value within the budgeted range. But, hiding your pricing page causes trust issues (remember: transparency matters). It could also mean that you spend a ton of time talking to people who want and can’t afford your product.
Design a pricing model that’s simple and clear. Set prices a little bit higher than you think people are willing to pay. Publish it on your website. Discount as needed.
Give Low-cost Integrations Away For Free
Integrations with other apps and services make your SaaS product stickier. They help bring your app into existing workflows. This helps prevent churn.
If an integration costs a ton of money to manage, charge for it or include it in a higher pricing tier to cover the cost; if not, give it away to anyone who wants it and it’ll pay for itself when accounts come up for renewal.
Work Testimonial Discounts Into Renewals, Not New Contracts
Startup sales teams love to give away testimonials. “Let us use your logo and we’ll cut a little off the price of your contract.” The problem is that when we sell a deal we don’t know with certainty that the product will work for the customer. If it ends up being a bad fit, you can’t do anything with that testimonial line item.
It’s less risky to work testimonial discounts into renewals. It’s also easier to execute on creating those testimonials when you have a well-established relationship with the customer.
Lock Down a Twitter Handle That’s Easy to Find
When you name a company and buy a domain, the perfect Twitter handle isn’t always available. Someone may be sitting on the handle, or it could be associated with a deactivated account.
If you can’t lock down a handle that matches your business name, pick something that starts with your business name. For example, “@<your company>team” is better than “@Team<your company>” because it shows up first in a new search.
Treat hashtags like channels instead of keywords. When you include a specific hashtag in your post, you have the opportunity to connect with other people who use or follow that topic. If you’re hashtagging #every #word #in #the #post then you’re not being targeted enough with your messaging.
Don’t Dismiss LinkedIn
If you’re selling to business executives, LinkedIn isn’t a bad place to be. It’s got its problems but it’s less noisy than Twitter.
Analysts give us lists of key phrases and we parrot them back so everyone knows that we know what’s up. But, jargon words can get misinterpreted easily, especially if they relate to other popular jargon works.
For example, “performance management” and “digital performance management” are unrelated. The first relates to helping your employees succeed. The second relates to making sure all of your digital systems are working most efficiently.
Make sure that your key marketing messages avoid jargon words so that people know what you do right away.
Slogans Are For T-shirts, Not Homepages
I once stumbled on a B2B website with a huge background video (read: bad for page performance) with gigantic overlaid text reading, “We heart email.”
“Me too. But, what do you do? Do you help me send better email? Do you help me get more emails in my inbox? Don’t make it hard for me to figure this out. I’m on your website because I want to know whether you can help me.”
Slogans work best on t-shirts, coffee mugs, posters, and advertisements where you’re trying to appeal to an audience in a more passive way. If someone’s interested, they’ll check for your logo and put two-and-two together.
Don’t Print T-shirts Before You Have Revenue
SaaS startup t-shirts are the bomb. You can wear them under blazers. You can change into them when your building’s air conditioning breaks and you’re sweating out of your clothes. Curly-haired friends: you can use the worn out ones to plop your hair — they make the best curl cloths!
Don’t print logo tees to hype up a business that doesn’t exist yet. They’re expensive. If you change your game or pivot early, they’re dead weight.
Testimonial Case Studies > Blog Posts
Blog posts are perfect for creating awareness and driving top-of-the-funnel metrics. Testimonial case studies help drive the bottom of the funnel metrics, converting the right people to sales qualified leads (SQLs). People like to do their research. If someone asks for a case study, you better have one ready to go.
Ease Into Marketing Automation
Marketing automation can be a powerful piece of your go-to-market strategy. It’s fun to develop robust scoring and grading models. Imagine all of the personalized engagement campaigns, with their long and winding branches! *sigh*
If you don’t have bandwidth to fully implement marketing automation, don’t let your system gather dust. Start with a newsletter and some basic page and content tracking. Layer in landing pages and interaction-based email automations.
Delete records that don’t look like good fits as they come in — there’s no reason to hoard bad emails in your database. You’ll pay for them later when you hit your account limits.
Ask Prospects for Their Work Emails
Speaking of bad emails, be sure that your inbound forms require valid email addresses. If you sell to companies, validate to exclude free email domains. Yes — you’ll see less conversions, but you’ll know that your conversions are coming from potential customers.
Stack Your Funnels
Back in the day, marketing teams focused on moving people through the funnel. Along comes account-based marketing (ABM) and they “flipped the funnel.” #flipmyfunnel
The pyramid-shaped concept is enticing. It encourages teams to be more focused and effective with their marketing strategies. “Only sell to your ideal prospective customers.” It also over-simplifies what happens in B2B marketing and sales. If you work a set of identified ideal prospects with the goal of converting them and creating advocates, you really end up with something that looks more like a tunnel with a large pool at the bottom. And, it doesn’t account for the fact that new, unidentified prospects will continue to demand your product.
So, traditional marketing funnel? Or, account-based marketing? Good news! You can have both.
Stack your old funnel on top of your flipped funnel and make something that looks more like a Chemex.
Note: I am by no means the first person to have this idea. Here’s a blog post that was published in 2012 featuring a similar hourglass-shaped approach.
People Love Friendly, Responsive Customer Support
When a new support case comes in, a quick reply is a nice surprise that assures your customer that you saw their message and you’re looking into it. Customer support is tough and it’s easy to let things slip between the cracks. Users are more tolerant when they feel like you’re matching their urgency.
When I worked support by myself, I always had an unmanageable backlog but I watched my initial reply time. For a long time, my average initial reply time (including overnight hours) was less than 6 minutes. It was a nightmare for my boss, but my customers loved it. When we measured it, we had a 100% customer satisfaction (CSAT) rating. We had lots of customer quotes saying things like, “Wow! Thank you for the fast and friendly support.”
Yes — someone needs to follow through. If you don’t, people will write in creating more tickets to get answers to their unanswered questions which makes your backlog more unwieldy. But, with limited resources, if you have to choose between 100% completion rate on cases and quick replies, do quick replies first.
Note: an automatic robot message from your help desk is not a quick reply. It confirms that the message was delivered successfully and that’s great for UX, but it doesn’t instill any confidence that someone’s actually working on it right now. Use autoresponders if you have the right tools available, but don’t let those autoresponders count toward your initial reply time metrics.
Express Empathy By Matching Tone
Emojis and GIFs are swell. I definitely got better at my job when I learned to lighten up and take things less seriously in support. Unfortunately, practicing empathy is not as simple as, “Use more smiley faces and jokes.”
Truly empathetic support matches the tone and personality of a user. If the email feels very serious and thought-through, take the time to send a formal, complete reply. If someone sends you a winky face, send a goofy face back. If someone needs help removing Bad & Boujee from an email that went out to their whole company… you see where I’m going.
Note: this also works on phone calls and in sales meetings. Be yourself, but be able to adjust to meet tone of the person you’re talking to. In my natural state, I’m loud, easily excited, and I curse like a sailor. If I start talking with an engineer who’s a bit more subdued, I’ll slow down and copy their levels so we both feel more comfortable. It’s not insincere; it’s considerate.
Another note: if you’re looking for a crash course for how to offer great support, read this.
Proactive Support > Good Reactive Support
Notice that a customer is setting themselves up for a problem down the line? Don’t wait for customers to reach out with questions. Start the conversation early.
Make Sure Your Help Desk Can Handle Forwarded Emails
One of the most painful mistakes I made as a Client Success Manager was moving my help desk from Zendesk to Intercom. Several friends recommended Intercom. I loved the chat-email hybrid that seamlessly tied an in-app conversation to email. Their mobile app was fast and reliable. I was totally sold.
“This is so much better than being chained to a chat support widget.”
If you’re considering using Intercom for SaaS company support, you need to know that (as of right now in this moment, to the best of my knowledge) their system has:
- No email forwarding. If a sales rep wants to forward an email to your support team on behalf of a client, Intercom won’t handle the forwarded email gracefully. There’s no way to move the rep to BCC and it creates a new case each time someone replies. Inbound queue becomes a pile-up of duplicate conversations.
- No way to CC multiple people. There’s no way to add people to an existing case. The conversation-based system is great for working with individuals, but it’s not set up for carrying on with multiple people at once.
- Not enough transparency for Enterprise users. As you move up market and sell to larger Enterprise organizations, users will request copies of their support transcripts. They’ll want to log in and see all of their open requests across their whole organization. Enterprise companies expect Enterprise-level help desk features.
- Insufficient reporting. Intercom’s Insights report lets you visualize volume and response time over time. You can tag cases for organization. But, there’s no great way to see how many cases with a specific tag were created in a given date range.
All that to say — when choosing a support tool, consider the experience for your customers and your teammates. Map it out. Write it all down. Check the boxes and make sure it fits into your workflow.
Customers Will Cancel
Even your most engaged customers could churn due to reasons 100% outside of your control. Their company could go under. They could get acquired by a larger company with strict rules and incumbent tools. Don’t panic.
Make It Easy to Cancel
Once someone’s ready to cancel, make it easy. If you can, let customers cancel their accounts from within the application without requiring that they email someone about it. Offer a call to learn what went wrong and whether there’s a chance to reconnect in the future. Accept that not everyone will want to tell you the whole story. If you’re working hard to save a customer who wants to cancel, ask yourself “Why?” five times.
Personal Performance and Day-to-Day Productivity
Disclaimer: I’m still getting better at this one. Do as I say, not as I do, y’all.
Bad quarters happen when you over-commit yourself to too many projects because you think they’re all equally important. Every morning, pick one thing that’s the most important task. Get it done before lunch.
Meet With Purpose
Start every meeting with a round of “Here’s what I’m hoping to get out of this meeting…” Every meeting should end with next steps.
Startup Land is high energy 110%, 25 hours a day, 8 days a week. When you’re high on the hustle and the hype, it’s easy to get disconnected from reality and the people who operate on different frequencies. Get involved with your community. Spend face-to-face time with the family you choose.
Brace for Burnout
Your personal happiness and fulfillment each day is more important than your performance or your goals. Take time off. Practice self-care. Cultivate sustainability in your lifestyle.
Management and Hiring
Know Your Team’s Strengths
Our COO implemented StrengthsFinder tests for every employee at our company. By focusing on individual strengths and looking at how strengths are distributed across teams, you can solve major problems with communication. Encourage everyone to play to their strengths with projects that align with their natural abilities.
For the record, right now my top 5 strengths are:
- Ideation, and
- Strategic or Significance. (Took the test twice with slightly different results).
This means that:
I love to come up with ideas to solve other people’s important problems strategically so that things can be better in the future.
Do what you will with that information.
Have Productive Weekly 1:1’s
My best 1:1 meetings looked like this:
- Time for you to tell me about you. What’s going on in your life? What are you excited about working on? What are you proud of? What are you looking forward to?
- Time for me to tell you about me. Here’s what I’ve been up to. Here’s what I’m working on. Here’s where I need your help and why it’s important.
- What do we need from each other this week? Here’s what I’ll do and here’s what I need from you. Write this part down somewhere that you both can see.
If week-over-week that “what I need from you” is always the same, stop talking about it and take one step in the right direction to cross that thing off the list together. There’s no point spending time arguing or making excuses about why something’s not getting done. If you wait until the end of the quarter to review it, it’ll be too late to make it better.
Sometimes the hardest thing is knowing the first thing to do. Figure that out and move forward with positive intentions.
Be Respectful of Your Team’s Time
Punctuality doesn’t come easy to me. I have to work really hard to be on time. But, when you’re a manager it’s super important to be on time for your team. When you’re in any position of power, being late or consistently rearranging meetings comes across as passive aggressive. It’s a subtle indicator that you think your time is more important than your employee’s time, even if you genuinely don’t feel that way.
Set meetings. Show up early. Plan a buffer for things to run over. Proactively communicate if you need to reschedule. This is easy to say and hard to do. People who do this right come across as being respectful of others.
Hire People Who Are Better Than You
“A-players hire A-players and B-players hire C-players.” This phrase makes me cringe because it reminds me of sportsball and no one ever picked me first for kickball in middle school. I’ve spent way too much time wondering whether I’m even an “A-player” and trying to figure out what I can do to become one. Luckily, being an A-player isn’t about being the best employee; it’s about building the best team. Hire people who intimidate you. Hire people with the skills and potential that you don’t always see in yourself.
Diversity > Referrals
In a startup, it’s tempting to hire exclusively on referrals. If a friend or co-worker recommends someone, you know they’re vetted. It’s safer than hiring someone in off the street. A weird, unexpected side effect of this is that eventually we end up in a room surrounded by people who are just like us. They went to the same types of colleges. They’re in the same clubs outside of work. They have the same types of work experiences. They’ve been raised with the same ideas about what defines success.
We know that diversity of race, religion, gender, preference, identity, age, background, and experience drives better, more effective businesses. It’s not up for debate. Racially diverse companies outperform by 35%. Companies with women in leadership positions return 15% stronger profits.
So, go out of your way to work to attract candidates with diverse backgrounds. Let people know, “Diversity matters to me. We’re looking for people who are different.” Your silence is loud. If you’re not ready to say this or publish it on your careers page, ask yourself “Why?” five times.
Moving from Early-Stage to Growth Phase
Everything Must Scale
If you do it twice, document it or automate it. Just don’t get so caught up in creating the process that you never actually do the thing.
Revisit and Update Processes
Is our weekly all-hands still working? Are people still updating the intranet? Is our style guide up-to-date? Is our current vendor still cutting it? Evaluate your current processes. Adjust them to evolve with your team.
Plan for Attrition
The people you need to build your company are not always the right people to take your company to the next level. Some individuals will be ready for the slowing pace and sharing of responsibility. They’ll settle into more specialized roles with sighs of relief. Others will feel paralyzed by new processes and required predictability. They won’t fit in your new molds without losing their limbs.
If keeping your early-stage employees on the team is a priority for you, make a point to carve out cross-functional leadership teams that aren’t exclusively for managers. Map out career paths that reward experience and preserve autonomy. Let people keep their seats at the table so they feel connected to the direction of the business that they helped build.
“That’s not possible!”
Yes, it is.
One strategy that I’ve seen work well at two super-successful Atlanta-based SaaS companies looks like this: move early-stage employees into new teams that act like small agencies within the larger organization. (This is similar to what giant companies do when they start innovation labs.)
For example, your first designer could become a creative director for special projects. Your first customer support agent could pilot a new partnerships team. Give old-school employees the freedom to be creative and develop management skills as you bring in outside talent to fill C-level and VP-level roles in the org chart.
Even if you do all the right things, the team around you will change over time. People need different things at different stages of their lives. Some people are just startup people. “Founders gotta found.”
Growing a SaaS startup from the ground up to the impossible is an incredible feat. They don’t teach this shit in schools. The experience is unmatched. It won’t fit on a resume or on a LinkedIn profile or even in a single blog post.
As beneficiaries and contributors within the startup community, we have an obligation to transfer our knowledge. We have a mandate to pay it forward and support emerging leaders.
While I hope you can take away something useful from this post and avoid some of the mistakes that I made, please know that fresh perspectives matter, too. I’m learning new things every day. This isn’t about what I learned — it’s about what we can learn from each other.