How to Hire the Startup Leadership Team for Your Growing Business
“Venture capitalists attribute 65% of company failures to problems within the startup’s management team.”
Your early-stage startup has reached a crucial milestone – you are ready to start scaling your business. You established a market with a need or demand for your product and attracted industry-specific investors and are moving towards profitability. As part of an action plan for growth, relying on your personal ability to ‘do it all’ needs to turn into a solid plan to hire the right leaders for your startup.
Startup Hiring at the Early Stage
Being a solopreneur has many benefits, but now that your startup has reached the early stage, it is time to face a new reality. The demands are high, many different skill sets are needed to keep your business going and growing, the workload and stakes are high. With this, a proven disadvantage for solo founders becomes apparent – they take longer to scale. And in an ever growing market, this matters.
“In an early-stage startup, the team is the greatest asset of the company. Because of this, finding the right first hires is the seed that would allow you to cultivate a productive startup culture.”
Ideas evolve, funding changes throughout the stages, the target market with its ever-changing competitors is in constant flux.
The one aspect of your growing business that you can define and shape with certainty is your startup leadership team.
Who to Hire to Build a Leadership Team
Typically, money is tight for startups and with every hire, burn rate increases. With this in mind, it is important to find the sweet spot of timing your hires. Don’t rush through the process of hiring leaders for your startup. But don’t take too long, either. Waiting can hamper your growth just as much as hiring the wrong candidate.
The startup leaders and team members you need to hire first depend on your business’s unique setup and needs. Knowing the ins and outs of your startup from the initial idea to its current stage, most founders are able to identify the urgent hiring needs. They should however always surround themselves with advisors. Ideally, these are successful startup founders and/or investors. With this approach, you will be able to have a nearly 360° view of what your organization needs now, and for the future.
In addition, founders have to be aware of their strengths and weaknesses. Identifying all gaps, it becomes apparent which roles need to be hired for first in their team.
“My suggested approach is to start hiring with a clear battle plan consisting of 3 areas:
First – identify the goal(s) of your startup.
Second – identify the ‘what is holding you back’ to achieve those goals? This can be inability to get more funding, growth, retention, decision making power, alignment, lack of strategy, lack of executive power, lack of knowledge, etc.
Third – as not all of the above reasons hold you back equally, segment them from “burning” (solve now), to “important” (solve in the next two quarters) to “long term” (important but can wait).
It can be helpful to bounce ideas off of your advisors to help with final formulation of what person(s) you might be looking for now and in the future. Aim to achieve all this in a week’s time. Knowing where you’ll be going will make for a smoother and shorter journey. “
Why Hire Startup Leadership Roles first?
Your ability to attract top talent will increase investors’ confidence. Once you’ve hired your core team, one of the benefits of having experienced leaders in the team is that these leaders can get investments at more favourable terms.
In turn, the additional investments help founders and their executive leaders grow the business at a faster rate than before. Great start- and scale-up leaders build trust with investors at every stage of your business and convince venture capitalists to take the risk of investing in your startup.
Additionally, you acquire knowledge by adding experienced leaders to your team. In turn, they help to create a foundation for your business that is scalable early on. Finally, these reliable leaders in a core team add a “divide and conquer” approach, allowing founders to focus on what they are good at.
For more on the topic of startup investors, take a look at our article “How to Find Investors For Your Startup”
“When hiring for startup roles, look for individuals who will strengthen your leadership and accurately represent your brand.”
Source: Business News Daily
“My suggestion is to make sure your startup is not getting too top heavy. Hiring too many leaders at the same time can make it tough to align the main mission and you easily get stuck in strategy. At the same time your business’s burn rate increases fast. Hire for startups with a focus on candidates who are capable of setting a strategy and ready to execute it.” – Delano Brand
Startup Hiring: Why and How to Attract Top Talent
To hire for startups takes a solid understanding of which roles are most urgent to fill, thorough research of top talent, and a network to reach out to. It is important for founders to understand that the startup’s core team will shape a company’s DNA and culture and its core team of leaders and managers needs to check a lot of boxes:
To summarize, this means that the founding team of a startup should consist of people who believe in the startup’s mission and the people who are pushing towards it. Employees willing to challenge and push each other are never identical in terms of skills and experience.
Key Search Hires Your Startup Leadership Team
Key Search has the expertise to help you hire proven start and scale-up leaders for your business.
Because we help some of the world’s most exciting startups and fast-growth companies hire their leaders, it would be my pleasure to talk to you about how we can put our expertise and in-house research to work to help you hire your leaders. Let’s talk!