Hiring for culture fit

Take time to define a clear ethos for your company, and the right people will come to you.

In the first post in this series, we talked about the Importance of Startup Culture. We also shared a number of Simple tools to build your culture. In this post, we’ll talk about the single greatest enemy to maintaining the culture you’ve built: bad hiring practices.

We all know that the cost of a bad hire is very high; typically quantified in terms of the high cost of recruiting, sunk cost of training and ramp-up, emotional cost of letting someone go, and the business cost of a temporary slow-down as you find a replacement. I’d say that’s the best-case scenario for a bad hire.

At worst, they fly under the radar while they slowly screw up your culture from the inside, unbeknownst to everyone involved. They are forgiven for their behavior, because they are high-performers (in the superficial sense). Months go by, and when it’s too late, you realize that the team starts to break down. Collective productivity and morale sink. Things start to feel different from how they were “in the early days.”

When Yoav went on a hiring spree after raising his $6M Series B, he almost killed his company. He saved Simple Energy by letting 21 people go in 1 day, when he realized that his team was culturally misaligned. “Diversity is good, but definitely not diversity in values!” is how Yoav summarized his key takeaway. They have since completely redesigned their hiring practice around screening for culture fit first and foremost.

We’d like to share some ideas to help you design your recruiting process around the concept of culture fit. It is too often overlooked; especially when startups are under pressure to scale too quickly.

Maintaining your culture

Culture is a lifestyle and it needs constant attention. Before you can hire for culture, you need to build it and define it. If you haven’t done this yet, I recommend checking out these culture tools. Assuming that your culture clearly defined, it should be very natural to then apply culture to your hiring decisions.

Don’t be afraid to reject job applicants due to a lack of culture fit. It’s better to focus on who you are as a team and to guard that culture at all cost; skills, experience, and an impressive resume are less important.

Imagine a prodigious developer who is a terrible culture fit. She might produce stellar work by herself, but does not gel with the team. Team morale and collective output is bound to go down over time. And when you start to hear complaints left-and-right about her, you’ll try to relay that feedback in an attempt to change her behavior. But soon you’ll realize that you cannot force a change in someone’s fundamental personal values. You will have drawn-out unpleasant debates, eventually turning her into a disgruntled team member who will jump ship in a heartbeat. They never cared deeply about the company culture to begin with.

The worst part is the collateral damage that she has inflicted upon your culture for the rest of the team. The fact that you hired her in the first place discredits either your ability to screen for culture, or the importance you place on culture altogether. The former can be fixed; the latter should be avoided at all cost.

Company persona

The easiest and most effective way to attract the right talent is to let your company be what you are. Your product, design, branding, website copy, blogs, marketing tactics, customer support, and all other external things together form the exterior of your company. If you want your prospective hires (or partners and customers for that matter) to know your culture, you should reflect that culture in the exterior. Through natural self-selection, you will attract better candidates this way.

Netflix went one step further and published a 125-page slidedeck describing their company culture in great details. Anyone looking to work at Netflix can study up on their culture, and decide for themselves if they fit.

We just published Routific’s values, so you can read up on our culture and get a feel for what it’s like to work with us :)

The primary reason for writing The Efficient Startup series is to share, but it also has the positive side-benefit of exposing our culture on a deeper level, so that future talent can get an intimate feel for who we are, what we stand for, and how we think.

Your company persona should also be reflected in the job posts you write. Don’t follow cookie-cutter formats; instead, write straight from your heart. Emphasize the things you deem important. Don’t optimize for volume at the top of funnel, but rather quality. It shouldn’t be any different from how you approach your go-to-market. You identify the ideal buyer persona, which would influence the way you communicate, so that you can target a very specific segment of ideal customers. Same applies with recruiting.

Recruiting process

1. Don’t work with a recruiter
2. Unless it’s an in-house one that fully lives and breathes your culture. They are the first interactions a prospective hire will have with your company, and we all know how important first impressions are.
3. Don’t hire under time pressure
4. Just like with all things in life, when you rush it, you make sub-par decisions. We like to hire great talent when we encounter them, as opposed to “filling a position” on a deadline. You have to get real lucky to find the perfect fit both in terms of culture and skills in a short period of time. This is why our job posts stay up for 6 months on average. We get a ton of inbound applicants, but we don’t need to make a hiring decision until we find a perfect fit.
5. Ignore applicants that couldn’t even bother with a short personalized message
6. This is a tip from one of our mentors at Techstars, Mike Evans — co-founder of GrubHub. They filter out 80% of the noise at the top of the funnel by this simple heuristic: If the candidate cares even the slightest about your company, they’d better apply with a cover letter of sorts.
7. I personally don’t like long formal cover letters, but a short message as you click apply on AngelList goes a long way. It shows that they are not just spraying and praying. Or a straight-up direct cold email works too. It shows us that you can “work around the system.”
8. Don’t skimp on the interview process
9. This is the dating period. You need to take enough time to gain confidence that this long-term relationship will work out. Everyone will be on their best behavior during the interview, so it’s up to you to create a process and environment to really get to know them deeply, especially when it comes to screening for culture.

Here’s the process that has worked well for us:

i. Short survey

Before even talking to the candidate, you should send out a very short survey to learn about their personal core values. It’s important to minimize bias at this stage. You can ask open-ended questions such as “What are the 3 most important things you’d want to see at a company?” or you can be more specific and present a list of values from which they pick the 5 most and least important ones. Key Values built a great tool which could serve as an example.

If you see any clear cultural misalignment, don’t even bother wasting your time moving them ahead to the next stage.

ii. Chat over coffee

If they pass the first unbiased cultural filter, I usually grab a coffee with the candidate for a casual chat. It’s like a first date. Can we get along? Do our values align? This chat serves mainly as a secondary culture screen.

Only if they still pass the culture test do you invest more time to test their skills. If you’re unsure about the culture fit, cut loss now. Evaluating their experience or their skills at this point will only cloud your judgement.

iii. Technical screen

When we’re confident that they pass the proverbial “Sunday test” (i.e. would we come to the office just to hang out with this person?), only then do we start the technical interview process. When we do the technical screen, we just use a whiteboard and work on a puzzle together.

iv. Homework assignment

This is the real skills test. Notice how far along in the process this is? We’ll task the candidate with building something in the comfort of their own home.

v. Half-day hack session + lunch with the team

The final stage is to spend half a day with the team to hack on something fun. What better way to get to know each other than to actually work together?

The candidate also has the chance to lunch with the entire team, so we can get to know one another. This is the final opportunity for the team to also screen for culture, although usually there are no red flags at this point.

Depending on the situation, we sometimes replace the hack session with a short real-life project on a contract basis.

You might think this process is long, but if you consider the consequences of a wrong decision, it’s well worth it. Some candidates might get turned off by the first few steps, but that’s an indication that they don’t care enough about culture.

Likewise, some candidates have told me that they don’t want to do an assignment, because they have offers on the table and feel “too good” to go through the process. Obviously not a culture fit for us. We only want to attract people who care deeply about Routific, and not someone who is focused on gathering competing offers for their own benefit, although this kind of competitive mindset might work well in a different culture.

Your recruiting process should reflect your culture, and serve as a self-selecting tool as well. Our team members have expressed they really enjoyed the entire process, especially the last stage.

Hiring too fast

Maintaining culture is a discipline. If you make an exception once, you’ll do it again. Once culture is broken, it’s scarred forever. Don’t compromise!

One of the biggest mistakes I see startups make is hiring too fast. How do you expect to maintain culture if your entire team grows 20 to 60 people in a matter of months? There are 40 new people, all of whom are still figuring things out, and if you didn’t screen them strictly for culture, they’ll sort of create their own organic culture, which dilutes the original culture completely. The only way to prevent this is to clearly define, live by, and hire based on culture fit.

Take the time to define a clear ethos for your company, and the right people will come to you.