How startup founders can make sure they’re hiring the right people — and what can happen if they don’t
The good news for founders is that it’s pretty clear when you’ve hired the right person to your startup. In sales roles, you’ll see them hit their targets. In engineering, marketing, and so on, you’ll know you aced the recruitment process when you see the overall bar for quality getting raised. Code gets better, copy gets sharper, deadlines are met, customers love you, and investors are happy.
On the other hand, it’s shockingly easy to hire the wrong person to join your startup. Worse yet, it might not be clear for months that they are the wrong person, giving them ample time and opportunity to cause the kind of damage that can’t easily be undone. Another way to think about it: In a small startup, hiring a single person could boost your headcount by 10 to 20 percent, so you want to get it right.
I sat down with Simon Tiu, the newest member of the Vertex Ventures US investment team, for his best tips on how founders can navigate this challenge and get better at hiring. Prior to joining Vertex, Simon’s career took him across firms including Deloitte, Google, and most recently Qatalyst Partners. In those roles, he was part of the hiring process for several key roles internally and externally, giving him a front-row seat to how the right person in the right role can make all the difference.
Right off the bat, Simon says that recruiting is one of the most important and highest-impact things a CEO can do, and recommends that it makes up anywhere from 25% to 40% of their time.
The biggest challenge is that even (or especially) the worst candidates will often show up well during the interview process: There are plenty of charismatic people out there who can charm an interviewer, but may not actually be suited to doing the work. That’s why Simon says that hiring, like so many other aspects of the startup CEO’s job, is a relationship game. One of the most practical ways to get an accurate view of a candidate is to go the backchannel route, asking former colleagues and managers what they think of the person.
To help get at an accurate view of the candidate, Simon likes to ask two questions during the informal reference check:
- If you had to stack-rank this person against the rest of their team, would you put them in the top or bottom 50 percent? If the answer is “bottom,” then that’s your answer. In practice, Simon says that people tend to answer this very candidly: By asking in such general terms, it takes the burden off the other party to use superlatives when describing someone who’s good, but perhaps not great. A former manager who thinks the world of the candidate will often respond by saying they’d put them in the top 1%, and lay out why. If they’re more lukewarm, they tend to answer in brief with no supporting detail.
- How did this person respond in times of stress? You want to select for candidates that not only know how to deal with the curveballs of startup life, but are also willing to work as part of the team to solve each challenge. How did the person react and respond? Did they jump in, or did they need to be told what to do? Every data point is valuable, but knowing how they handle stress is especially important for early hires.
It’s also important to “backchannel the backchannelers,” as Cyberhaven CEO Howard Ting recently put it. As best as you’re able, you want to make sure that the people giving feedback don’t themselves have some kind of an axe to grind, unfairly skewing their feedback. That, in turn, is another reason why CEOs need to invest so much time in the recruiting process and not let it be an afterthought.
Finally, Simon advises that it’s almost always better to let the hiring process take as long as it takes, and not to cut corners. The headache of having a vacant role is nothing compared to the pain that comes with bringing on the wrong person.
What if you hire the wrong person?
Make one misstep in the hiring process — rushing through the reference check, missing a red flag on the resume, or getting swept away by a charismatic (but underqualified) candidate’s self-promotion, to name a few — and you run the very real risk of causing significant damage to your long-term prospects.
The wrong person might seem like they’re doing all the right things, but are actually creating messes that have to be cleaned up later. This person is also likely to recruit others who perpetuate the wrong practices, embedding harmful behaviors throughout the organization. This is especially true in engineering roles, where doing things the wrong way can incur mountains of technical debt that only grows exponentially as the codebase scales up.
To that point, Simon warns that hiring engineering leaders carries its own unique challenges for founders. Every startup wants to hire the experienced, grizzled engineering leader who’s seen it all, and for good reason — a person like that can absolutely accelerate product development and inspire the rest of the team to greatness.
The trouble arises, says Simon, when that person thinks they know better than the rest of the organization how things should be done. That tends to lead to fiefdoms within the engineering organization, as each team does things in their own way, at odds with their colleagues. It creates a toxic culture that, again, a startup can’t afford to foster.
The only antidote is to make sure that your prospective hire has an empathic leadership style. They don’t necessarily have to be nice, or fun, or good at playing office politics. In fact, there are benefits to having people on your team that will always tell you the unvarnished truth, for good or ill. But they do have to be willing to work with you, be flexible, and consider alternate perspectives.
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