How to Hire a Big-Time Business Executive for Your Startup

Published in

The Startup

9 min readAug 9, 2017

Originally published on http://www.appsterhq.com

Nimble, scrappy, lean, ready to pivot as soon as necessary, focused on rapid growth, consisting of small teams and modest (if any) salaries — these are some of the most common characteristics of 21stcentury startups.

Inevitably, though, a startup reaches a point when it becomes necessary to hire a big-time business executive who can help take the company to the “next level”.

How, exactly, should you go about hiring such a person?

In this article I’ll discuss 3 key considerations to keep in mind when engaging in this hiring process.

When Should You Hire a “Big Shot”?

It can be very easy for a startup founder eager to achieve massive success to be seduced by the prospect of hiring a seasoned business executive who could “really make things start happening for us!”

Business veterans who have worked for decades at top-performing firms, who have managed hundreds of millions of dollars of revenue, who have been in charge of networks of hundreds of employees, etc. etc. — the prospect of hiring these kinds of professionals to accelerate your startup can indeed be very enticing.

How, though, do you know when it’s an appropriate time to try and hire a big shot executive?

It’s clearly unfitting to do so during the earliest stages of your startup’s life, when your major concerns should be building and testing your MVP and achieving product-market fit.

Drift’s David Cancel explains this point in no uncertain terms:

“It’s all about pairing an executive with the stage of a company’s growth that he or she has the most experience working in.
Think about it: If you’re a 15-person startup with less than a million dollars in revenue, what use would you have for an executive who’s worked most of his or her career at a company with tens of thousands of employees and billions in revenue? The skillsets usually won’t match up.”

Going after a big-time exec is, thus, more appropriate when your primary objective is to scale and expand your business and your team starts having difficulties managing all that this entails.

Here at Appster, we’ve hired various executives who have contributed tremendously to our company but we’ve also hired a few who did not.

Part of hiring the right executive requires that you consciously target specific skillsets that are in line with the unique needs of your startup as it progresses through different stages.

Based on ideas discussed on the High Growth CEO Forum, we can note that differently skilled big shot professionals are more and less suitable as candidates during different times of your startup’s lifecycle.

Specifically, we can look at 4 particular phases:

Early (but not too early!): when your focus is developing and refining your product, you should target executives who are “doers”, i.e., those with “front-line” experience who have been in the startup “trenches” before.
Initial growth: when your objective is to drive sales, you should go after executives who have a knack for delegating tasks and managing teams.
Rapid growth: when your aim is to become a market leader, you must seek out professionals who have a demonstrated ability to build out startup teams, coach employees, and successfully plan for long-term growth.
Continuous growth: when your aspiration is to dominate the market, you need to go after executives who are true organization builders and strategic innovators — people who can take the chief role in directing company culture (source).

Now that we have a better sense of the different kinds of execs your startup should consider hiring, let’s look at 3 specific considerations to keep in mind when engaging in this process.

I’ll also share some hands-on experiences we’ve had thus far at Appster.

1. Hire People with Experience in Both Big and Small Firms

The Appster leadership team and advisory board comprise people who have come from all sorts of different companies.

Some have managed billions in revenue, whilst others have emigrated from much smaller firms.

As there are pros and cons to hiring both kinds of executives, let’s take a look at some of the defining points of each.

Hiring somebody with lots of big company experience is advantageous because:

She will be intimately familiar with a number of the systems and processes that larger companies use to manage scale, some of which are likely to be useful to your company’s growth efforts.
He will have a solid understanding of ways for addressing and fixing issues with which small startups are likely unfamiliar, such as methods for better positioning communication to different stakeholders in the business, more effectively managing increased complexity, and achieving enhanced organizational design. These are all matters to which your company must attend once you cross the 50-person (or so) barrier.
She will likely be connected to large and powerful networks, which very well might feature various kinds of resources with which your company could expand, attract new business, work with new partners, etc.

Hiring somebody with a solid amount of small company experience is advantageous because:

He will have a strong history of “getting his hands dirty” by working “in the mud”, helping to build one or more startups from the ground-up.
She will have the capacity to work effectively in the midst of “chaos”, grasping what it means to work in an environment that sometimes lacks clearly defined processes and might not have established revenue streams just yet.
He will “battle-tested”, i.e., knowing what it takes to push past multiple failures and help build something from nothing.

My experience as co-CEO of Appster definitely leads me to believe that the most ideal business executive is the one who has worked for both big and small companies.

If you hire somebody who has worked executively in large companies then it could very well take her too long to adapt to the specific ways in which your particular startup works.

Alternatively, if you hire somebody who has worked only in small ventures then he might lack the talent and knowledge to adapt to fast growth, especially when the complexity of your company outpaces what he has managed previously.

2. Hire Adaptable and Humble Execs Who Are Willing to Learn Alongside You

It’s important to recognize that there’s a certain kind of big shot executive who will almost never fit well into the culture and operations of a small tech startup.

Amongst other qualities, this professional will tend to:

View his working at a startup as equivalent to a career “setback”, punishment, or otherwise unfortunate and unwanted outcome;
Feel intimated by, and express negative attitudes in reaction to, having to answer to somebody half her age;
Complain about having to work without the presence of a massive team to whom he can delegate the less-than-attractive daily tasks; and
Act passive-aggressively toward other employees, bringing a toxic culture into your startup and poisoning your environment.

This type of executive is clearly not a good choice for your company and so he/she should be avoided at all costs.

Alternatively, your startup should be seeking out a business professional with the following kinds of small company-supportive attributes:

She’s a deeply humble person who’s confident and talented but also a) willing to take feedback from others and b) genuinely dedicated to learning from her new environment;
She adapts well to the realities of your specific workplace culture and the values and objectives of your startup; and
She’s far less concerned about preserving her ego and out-shining others than she is applying her knowledge and skills to the goal of helping your startup achieve its primary objectives.

How can you as a startup founder (or hiring manager) try and ensure that you hire the latter (and not) the former type of individual?

That leads us to the third and final consideration.

3. Thoroughly Check and Engage with Candidates’ References

I admit that at times in the past I acted as a lazy reference checker when hiring — but not anymore.

Brad Smart, a leading expert on hiring high performers, suggests that a startup that makes a significant hiring mistake can end up losing anywhere from 15x (for a manager) to 27x (for a top executive) the amount of money it would have paid a big time professional in terms of a base salary.

In other words, bad hires at the top level can be very costly to a small company.

Clearly, then, it’s worthwhile performing your due diligence when considering whether to hire an executive.

A crucial part of such due diligence involves applying a very meticulous, thorough, and unabashed attitude to your approach when checking through and engaging with a candidate’s set of references.

Indeed, when they are properly conducted, reference checks can function as the “elixir of truth” when it comes to exposing candidate exaggeration offered during interviews.

Here are 4 simple yet important rules to follow when engaged in reference checking:

Immediately abandon any hiring considerations if a candidate refuses to provide you with, or to allow you to personally contact, one or more of his/her referees.
Do not let your recruiter conduct reference checks for you as it’s extremely unlikely that he/she will diligently try and find flaws or culture clashes behind why you shouldn’t’ hire somebody;
Speak to at least 5 of the candidate’s previous managers; and
If a candidate’s referee wholeheartedly refuses to offer you any sort of critique or assessment for ways that the candidate could improve then politely but insistently dig until something emerges. You could try saying something along the lines of: “Surely even an Olympic gold medalist has various things on which she’d like to improve or at which she’d like to get better. What about name of candidate? What, even if it is something extremely minor, do you think he/she could do to improve, to get better?”

When conducting reference checks, be sure to look into the following possibilities:

Has the candidate ever been involved in disputes with colleagues in the past? Why did they occur? How do his/her referees remember the situations?
What evidence, if any, is there that the candidate has the ability to put the needs and interests of the company ahead of his/her selfish desires?
Has the candidate in fact done all the things about which he talked during his/her interview(s)?
What evidence, if any, is there that the candidate is proactive and forward thinking as opposed to reactive and obsessed with the past? Does he/she wait for solutions to be brought forward or does he/she take initiative and make things happen, so-to-speak?