If you are a rapidly growing startup (or at least wish to be one), scaling up your hiring and recruitment function will be one of your biggest challenges. That being said, when done right, it will also be one of your key levers for growth. People are the growth engine for your startup – and any mis-hire, particularly when you’re early, can set undesirable initial conditions for scale.
Generally speaking when there are fewer positions to fill, recruiting is less of a problem. But, when hiring is ramping up, or your headcount growth surpasses your capacity to fill the roles, – recruiting problems inevitably arise.
At scale, most startups compromise the quality of the hires for faster hiring. Whilst we can initially judge this is foolish, those companies who don’t move quickly can both lose access to the best talent, as well as lose first mover advantage and displease investors.
So, on the one hand you need to hire, quickly. And on the other, you must also ensure quality; finding this balance in a still maturing talent function can be both scary and difficult.
This is where proper preparation comes in. You don’t react to what you need now, you are acting on the previous plan you already outlined.
Preparation may be in the form of creating a proper plan/strategy for your recruitment team and striving to create and market an EVP (Employee Value Proposition) – more on this soon.
In this guide, we will share some valuable insights about preparing your startup for hiring success at scale.
Create a Plan
As you grow and raise the initial rounds of VC investments, a significant chunk is going to go into people. Whilst it may be tempting to build your team at rocket speed, scaling at the wrong time can lead to failure. In fact, research suggests that more than 70% of startups fail due to immature scaling.
Therefore, it is crucial to have a plan before you start looking for new joiners. Determine the number of new employees you need to ensure sustainable growth at scale, and define your long-term and short-term goals to identify your headcount requirements.
The teams you want to expand must be the teams that will fuel your sustainable growth. Identify the gaps in your teams and try to fulfil them. Once you are done with them, focus on hiring for the teams that will fuel your growth.
Remember – failing to plan is planning to fail.
Establish Your Employer Brand
If you want to hire rockstar talent into your company you will have to compete with the companies that attract these rockstar employees. These companies, for the most part, are large corporations that have way more resources than you. The reason why top talent prefers these companies is, in many cases, because of their EVP.
EVP, short for Employee Value Proposition, is the Unique Value Proposition your company offers to your employees. It can be anything from an enhanced sense of well-being, to a flexible work environment, to inclusive and welcoming company culture.
As a startup, you need to establish your EVP in the market to attract the top talent to join your startup. You have to offer something extraordinary to your employees that attracts them to join your team. Remember, the top candidates in the market will have offers to choose from…
So why should they choose you?
How you create that EVP entirely depends upon the nature of your business and your unique approach to HR.
Another great thing about having an EVP is that it will filter out candidates who don’t align with your value proposition, whilst simultaneously attracting those who do.
Having an EVP will provide you with an edge over your competition. It will help you attract rockstar employees to join your startup.
Have an EVP.
It Is Costly
Poor cash management is still one of the biggest reasons to fail for startups. According to research, 80% of your Series A/B funding goes to people.
Hiring and recruiting at startups costs a ton of money. To top that off, the time spent filling a position can be up to 6 months. 6 months?! That is not a time-to-hire acceptable for a scaling startup. In addition, startup founders spend nearly 40% of their time managing HR tasks such as Payroll, hiring, and others.
The financial and time costs associated with hiring and recruiting are significant. As a rapidly growing startup, not plugging the financial leaks in your talent function will be an unnecessary waste of capital.
Therefore, it is crucial to plan your finances carefully – and try to save as much as possible from this.
One way to save money on recruitment is to opt for an Embedded Talent Partner. If you wish to do all the hiring through an Internal Recruiter, you may end up spending a lot more time than expected, and you may not have the projected headcount growth to justify such a commitment. And recruitment agencies will be devastating for your budgets with their 20% fees!!!
An Embedded Talent Partner brings the best of both worlds.
So make sure you 1) Budget!; 2) Find the right hiring solution factoring in your projected headcount growth; 3) Save where you can.
Don’t Rush It
As your sales and subsequent revenue skyrockets, you want to see your talent acquisition grow at a similar rate to further fuel that growth. You also won’t want to lose out on good candidates by moving too slow. As a result, you push the recruitment teams to speed up the hiring.
But it is important to decipher between a sense of urgency, and simply rushing. Let your TA team members take the necessary time they need to fill the roles (but, of course, no more).
Trying to fulfill the headcount goals ASAP is not a good long term strategy. Hiring at scale is not only about speed – but also about the quality of the hires. Finding the right culture-fit and skill-fit candidates for your company may take time, and you must be ready to wait for the right person.
Lastly, constant improvements in the processes of your recruitment function is absolutely key to successful hiring at scale.
Scaleups don’t just iterate towards product market fit, they iterate towards optimisation of all areas of the business. And to do that, you need to set KPIs and track data throughout the hiring process.
As you continue to grow, look back and try to learn from your recruiting history, keep on finding the gaps in your processes, and iterate your way to hiring success.