Google consistently ranks as one of the top companies to work for. It offers attractive compensation packages and tons of perks, like free food and onsite gyms. The company even has a “20 percent time” policy, where employees can spend 20 percent of their time on side projects.
It’s no surprise that Google receives an astounding three million applications per year. Needless to say, Google and other major corporations have no problems attracting talent. But startups face significant challenges right off the bat when it comes to hiring.
Challenges of Hiring for Startups
Startups don’t have the same reputation as more established companies. This makes attracting talent difficult in the early stages.
Most startups also lack the funding to invest in HR. Without a department to handle recruitment, company founders often have to take on hiring duties on top of their workloads. Even if they do find qualified candidates, they might lack the skills to assess their abilities.
A lack of hiring experience and an inability to offer competitive compensation packages make hiring all the more challenging for startups. So how can you overcome these hiring challenges?
Top 6 Practices to Build a Winning Team
Hiring the right people is crucial for the success of any startup. A survey by CB Insights revealed that one of the top reasons startups fail is because they don’t have the right teams.
It’s not an understatement to say that your hiring decisions could make or break your company. Follow these best practices to build a winning team for your startup.
1. Hire slow, fire fast.
Bigger companies can afford to leave positions vacant until they find the right person. Startups don’t have that same luxury. A skills gap can hamper growth and put projects at stake. But rushing through the hiring process can result in poor decisions.
“Hire slow” means hiring with intention, and “fire fast” means parting ways with employees who don’t work out sooner rather than later. Evaluate what positions you need to fill and get clear on the qualifications that new hires need to succeed in their roles.
For any documents you and your employees will need to sign, consider using document signing software. This will help shorten the time to productivity for new hires.
2. Don’t hire based on hard skills and experience alone.
It makes sense to hire the most qualified candidates you can. But hiring solely on skills and experience can limit your talent pool. Don’t shy away from hiring qualified and passionate candidates when building your team.
Passionate employees are highly engaged. They’re enthusiastic about the work they do and have a vested interest in helping your startup succeed.
Deloitte defines three characteristics of passion:
Commitment to the domain: Employees are committed to the work they do.
Questing disposition: Employees are always seeking new challenges.
Connecting disposition: Employees seek deep interactions with others.
Look for employees who exhibit these characteristics. During the interview process, ask potential candidates why they chose this particular industry and what kind of challenges they’re looking for.
3. Decide when to hire generalists vs. specialists.
One important decision you’ll make when hiring for startups is whether to hire generalists or specialists. Hiring a combination of both is crucial to building a winning team.
A generalist is a “jack of all trades” individual with a wide range of skills. They could pitch prospective clients one day and contribute to a marketing campaign the next. Generalists are valuable hires, as they can draw from their vast experience to solve different problems.
Specialists, on the other hand, are experts in their respective fields. While specialists cost more to hire, they can contribute to key growth areas in ways that generalists can’t. For example, when choosing an appropriate business structure for your startup, you’ll want to work with a specialist to help you navigate this complex process.
4. Hire based on company culture fit.
Hiring candidates based on company culture fit is just as important as finding employees with the right skills. Employees whose values align with their employers are more likely to enjoy their jobs and perform better. This ultimately leads to a more productive workforce.
Define your company culture and identify the core values that your startup represents. Have these core values ready as you interview candidates and highlight them in your job postings. Consider using behavioral assessment tests to determine whether candidates will fit in with the company culture and the rest of the team.
5. Diversify your potential hires.
Hiring people from different backgrounds offers numerous benefits. Workplace diversity fosters creativity as each team member can share their own unique perspectives. This inclusiveness makes employees feel more valued and willing to contribute.
Employees who also speak different languages can contribute to the team from their diverse cultural backgrounds. While it’s best to speak business English if you’re based in the U.S., you should also encourage your bilingual and multilingual employees to enlighten other team members about their language and customs.
Ways to diversify your workforce include writing more inclusive job descriptions, advertising listings on different job boards, and turning to existing employees for diversity referrals.
6. Consider investing in a recruiter.
Taking on recruitment duties takes you away from other responsibilities like reaching out to investors, developing product roadmaps, researching new markets, etc.
To help with your hiring efforts and save a great deal of time, consider working with a recruiter. These individuals do a lot of the legwork to find qualified candidates. Alternatively, you can also work with a PEO company (Professional Employer Organization) to help with employee recruitment and retention. Hiring such an organization will provide the data and tools that you need to save time during this process.
What happens next?
Employees are perhaps the most valuable asset for any company. They carry out your vision and work directly with your customers. As you build your team, it’s important to exercise strong leadership and practice team building to encourage collaboration.
Provide opportunities for growth and ongoing education. This will motivate employees to work harder and increase retention rates.
Finally, continue to refine your hiring process. Even if you’re not hiring right now, you most certainly will be in the future. Solicit feedback from current employees and work on your content using content optimization software to make it easier for potential candidates to find you online.
Hiring can be a complex process for any organization, but hiring for startups comes with its own set of challenges. The people you hire now can mean the difference between growing your startup or seeing it stagnate. Implement the tips outlined here to build a winning team and hit the ground running.