The “New Normal”​ Talent & Hiring Best Practices

Created in collaboration by the team at Kindred

We are all learning how to adapt to our “new normal” with Covid-19. Here at Kindred, we’ve had many discussions over the last few weeks with our venture partners, our portfolio companies and executives, all asking very similar questions about how this is changing our industry and hiring/recruiting specifically. We are using our platform to gather these insights, and sharing an outline here with key challenges that we feel need to be addressed during the hiring process. We’ll continue to add as we learn more.

How should our company think about our current and future team/talent?

• Determine your absolute “critical” hires/needs within the business, and evaluate the existing team to see if there are ways to offset making a hire (eg. hiring a VP, Customer Success vs leveraging existing CRO who has managed CS in the past, war-time promotions vs an external hire, etc).
• If you need to make a new “critical” hire, don’t wait to see what happens over the next two — three months. Remember that on average, searches take 75–90 days to complete. This duration may be extended right now- it’s a bit early to know. The point here is that if you have a critical hire to make, you shouldn’t wait to get started.
• As you are building cash reserves to lengthen your runway (we are hearing that venture firms are advising to have at least 18–24 months of runway), we feel it’s important to remember that over the next 6–18 months, it is a near certainty that you will have to add to or replace parts of your senior leadership team. If you can manage this process yourself- great. If you need to leverage an external firm to help your recruiting efforts, you’ll need to consider those future costs in your plan. We also feel it’s imperative that search firms can and should be flexible with companies on payment terms & working around capital constraints.

How do we run an efficient search/recruiting process given our constraints?

• If you are in the same city as the candidate, it might be possible to meet in an open area for a final meeting, but video is going to be 90%+ of any recruiting process for the foreseeable future. To make this new recruiting workflow successful, you need to start by over-communicating with the internal team and the candidate (and BOD if involved) about your process. Detail every step of the process with primary and back-up plans (technology isn’t always perfect) and share with everyone. Make sure everyone knows what to expect; is this a one-on-one and for exactly how long, is this a panel interview and if so who is leading, is there a single video link the candidate controls or will there be multiple links, is there break or food time built into multiple interviews, how will your team notify the next interviewer that they need more time, etc, etc, etc. No detail is too small to ignore.
• As you prepare and set expectations for video interviews, make sure that everyone involved is ready for (and non-judgemental towards) the inevitable WFH challenge or interruption.
• Formalize the process and technology to provide feedback- this is likely to be different from your existing process. If you don’t have the right tools, set up Slack or Google Chat so that all team members can share notes and feedback
• Set up checklists to test both objective and subjective qualities. We typically rely on live meetings to get a sense for executive presence or collaborative skills. We suggest doing more virtual whiteboard/working sessions to test some objective questions that may need to be answered. Take the time to get to know the person- this can be awkward on video, but can be managed if you prepare and set expectations ahead of time that a particular conversation is going to be “informal.”
• References have always been critical… Now, references are king! Formal and backdoor references early on in the process are going to be more important. And we need to be asking different questions that fill in gaps missed due to lack of live meetings.
• Be aggressive, be aggressive, be aggressive! Two months ago, it may have seemed possible and reasonable to take your time and evaluate a large group of candidates. If you find someone who hits the bar and is interested, you should swiftly and efficiently get to a decision and move to hire (see thoughts on timing below).
• Flexibility: we believe that it’s time to be more flexible on a position spec, whether you’re kicking a search off or in the middle of an existing process. We’re not saying you should settle for mediocre talent. We are suggesting that you define your “must haves” more tightly, and that you be more open on areas such as domain, location, etc. This is especially true if your company is being impacted disproportionately (that’s relative) right now.
• Extending cash and runway right now is key, which means that it’s less likely you’ll want to use higher cash or some type of sign on as an incentive. What are you prepared to do on the equity side to get a great candidate? And- while it’s impossible to know what future funding and multiples are going to look like, it’s safe to say that your previous assumptions/projections for equity value (for a candidate, in this case) are going to be different.

What is the candidate perspective? Are executives willing to actually look at opportunities?

• Right now, candidates seem to be pretty willing to have discussions (perhaps even more than early Q1). First, the WFH environment has made it easier to have conversations and to do video-conferences (which may actually expedite the process). Second, executives are more willing to help us and others if they can, and seem to be more willing to engage in networking conversations. Third, this is an unprecedented time of uncertainty, and most people are going to want to hear about companies/opportunities that represent a different/better future. We know risk-premiums are high, but great talent is there and listening.
• Founders and CEOs are optimists. More than ever, it is important to be honest and upfront with candidates about the health of the company. Good candidates are going to dig in and ask about your cap table, valuation, preferences, cash situation, burn rate, AR and pipeline quality, market opportunity in this new reality, etc, etc, etc. While these questions may be deeper in nature than usual, they are totally understandable even early in the process- don’t be evasive or defensive.
• Being upfront about the company’s ability to weather this market will help you find the right candidate. It’s been 11 years since a major downturn… being open will help you find a leader who is not afraid (and maybe has experience) to deal with these types of challenges.
• Understand that candidates are likely to have a higher sense of responsibility to help their current company. So if you are in the middle of the recruiting process with a specific candidate, remember that 1) he/she may not have as much control over their schedule as they’d like, 2) their current company will try very hard to keep (or buy-back) any strong/valued executive, and 3) it may take longer for that candidate to transition out of his/her current company.
• As we think about the process of closing a final candidate (guiding through the resignation, potential buy-back, potential guilt, transition period, etc), it’s going to be really important for the hiring manager (and potentially your BOD) to stay very close to the candidate. Are there other ways to help that might be more important now? Is your healthcare plan different/better? Do you and/or your BOD have relationships with secondary investors or brokers that might be able to help get your candidate some liquidity or purchase his/her options?