The Dos and Don’ts: First Hires.

For a founder, the first hires are hugely important, and can sometimes be make or break.?

Knowing who to hire, with what expertise, what the culture fit should be, what is too much or too little experience are all essential things to consider.?

Here’s what I’ve learned since entering the startup world.?

1) Your first employees shouldn’t necessarily be your c-suite?

It’s very tempting for founders, especially first-time founders, to make their initial sales person their Chief Revenue Officer, or their initial marketing hire their Chief Marketing Officer etc.

But, the people you want in your initial team need to be generalists, not specialists. These people need to wear multiple hats and take on lots of roles within the business.?

The trouble with giving them a CXO role straight away is, generalists tend to struggle to refine (they are often very different skillsets). They’re good at lots of things, that’s their strength, but that won’t necessarily mean they have the experience to become a c-level team member.?

Plus, there’s no way of knowing that what they can do as a team of 2-5 people, they can do for a team of 30 people, or 50 people. If you do that, you’ve made a rod for your own back.

2) You need to empower your first hires to reach the next level?

Expanding on point 1, although you aren’t giving them c-level title, you still need to give them a good title early. For example, Sales Lead, Marketing Lead, Product Lead, to make them feel an integral part of the business and to make the risk they’re taking in joining your canoe (pre-rocket ship) worth it for them personally.

You also need to give them the skills and motivation they need to potentially reach the c-level title if they can. They will have dedicated a lot of time, blood, sweat and tears (hopefully figuratively) to you and believed in your vision when there was very little to show for it– you need to give them the same commitment and more back.?

Finally, if you do have to hire someone above them, let them know that you still believe in them completely and want them to learn directly from this person so they can grow into that role later (or somewhere else as that may be the case).?

3) Give honest feedback and be open about your expectations?

These people have joined you to learn. It may feel like they are helping you out, but they need to hear what is going well and what needs to be improved upon.

It can be difficult to do when you’re just starting something, everything feels all over the place, and, especially if it’s your first time, you’re a little (a lot) out of your depth as a leader. But you're not doing anyone any favours by placating/not providing constructive critique.?

Equally, you need to be open about your expectations with them and what you want from them, but understand it was your choice to take on this task (no one forced you) and that it is only your baby. Your first team needs to be able to join, work really hard, achieve what you want them to, but they need their own balance.?

They cannot be doing the same tough hours and backbreaking work as you.?

4) Never underpay your first hires. Ever.?

When you decide to bring people on, you need to be able to pay them properly.?

Joining and working for a startup is not easy, it never will be. Your staff deserve to be compensated fairly for the choice they are making to work really hard with you. If not they will leave for a better paid role with less stress. You cannot retain staff if they are paid badly– especially in a startup.?

I’ve seen too many founders promise staff will be paid more fairly “once we get a round of funding”– please don’t do this. Funding is a long unpredictable process and isn’t always guaranteed. You will find staff become quickly unhappy when this “promised” money doesn’t materialise.?

Either pay them properly in cash, or give them the correct level of equity to compensate.

5) Don’t give away too much equity

If you do compensate your first hires with equity, make sure it isn’t too much.?

Understanding your equity dynamics is really important and I’ve seen a few founders give away too much too soon and really create a rod for their own backs.

There’s no wrong or right amount to give, but it’s important to understand where you are at with your situation and how much you can give away.?

If you are unsure get some advice from someone who has done it before.?

6) Be transparent about the risks?

Finally, startups are risky. Your team will know this to some extent, but you need to be really honest with them.?

If you've got 0 runway and no prospect of paying them in 3 months, and they have kids to feed- don't convince them to quit their secure job for you.?

They need to understand and accept the risk. If the risk puts them off they're not the right person for your stage.?

There’s no point in convincing someone to join, not being able to support them and letting them down.?