As your startup grows, you will notice hiring gets harder and harder; you will need more and more people to hit goals while having to offer them less equity as the team grows. The tactics that worked to find your first 10 employees may not work for the next 50. Here’s how to scale your hiring:
Use Existing Team’s Network
What: Go through all your existing team members’ networks on social media with a fine-tooth comb. Use software to pull team member networks from the social platforms, e.g. LinkedIn, and ask for recommendations with a cash referral incentive (usually $2–10k). Encourage team members to post jobs on social media and boost company posts.
Why: Your team members want to work with great people, so they’re motivated to help bring in those they enjoy working with. Since your first employees usually come from the founders’ existing personal networks, finding new networks to explore is critical.
Pay Higher Salaries
What: Pay higher salaries as you offer steadily less and less equity to new employees. If you were paying 30–50% of comparable salaries at Google or Facebook, try increasing that to 50–75%. Offering benefits can also help, such as remote work, a 4-day work week, or funding for continued education.
Why: Although a potential employee may be interested in your company’s mission, most people will be unable to say no to 2–3x higher corporate pay elsewhere, if they only own 0.1% of your company. Work flexibility is also an effective way to attract talent, as many people seek a higher quality of life outside of corporate environments. Plus, if you’re scaling, you likely have cash on hand and staffing is a great place to put that money to work.
In-House Recruiters
What: Once you have 3 or more open positions, it’s probably time to hire an in-house recruiter who can scale outreach and screening. Finding a good in-house recruiter will take time, so you may have to use a third party to provide an in-house recruiter temporarily.
Why: An in-house recruiter, with equity as part of their compensation, is aligned with your company’s long term interests. I prefer to avoid contingency-only recruiters who work on commission and are thus forced to optimize for their own short term earnings; which may not be in your best interests.
Public Listings
What: Post your jobs on public company profiles like AngelList and LinkedIn. Be prepared to spend up to $5K if necessary. If you’re a member of a startup community or have investors with a jobs board, post your open roles there too.
Why: Jobs posts on popular websites and social networks improve your ad’s distribution due to the high volume of users visiting those places each day. These services are often free or have comparatively low fees versus recruiters, so there’s minimal risk in trying them.
Hiring is one of the hardest problems for startups throughout their lifespan and making the transition from hiring your friends to a repeatable, scalable process is challenging. Work to remove the bottleneck by leveraging your team, public platforms, in-house recruiters, and being flexible on compensation.
Thanks to Kaego Rust for their help with this article.
Sterling Road invests in pre-seed B2B startups based in the US and Canada.
Full investment process. Contact: ash@sterlingroad.com
Photo by Andrea Lightfoot
