Great Startup Recruiting is surprisingly similar to great Startup Ideas: Just like you have to find undiscovered opportunities to start a great startup, you need to find undiscovered talent to build a great startup team. In this Lesson of Greatness, we discuss how to find great undiscovered talent and five key factors to look for.
You must hire people who are undiscovered talents. You cannot recruit people that are already proven. The reason why is there's always going to be large incumbents. They would pay more money than what you could afford to prudently spend as a startup.
These words by Keith Rabois are totally on point for a key lesson of greatness. Great startup teams find undiscovered talent. Let's discuss why.
Keith Rabois makes a crucial point for founders who are committed to building awesome teams. You have to find great undiscovered talent. Why is that? Well, it turns out that discovering great talent is a lot like discovering great startup opportunities. You have to have a unique insight. You might remember in my interview with Andy Rachleff, we talked about the notion of a two by two matrix for startup ideas. On one dimension, you could be right or wrong, and on the other, you could be consensus or non-consensus. Being right is not enough because the upside gets arbitraged away through competition. You have to be right about an opportunity that others don't know about. You have to be non-consensus and right.
The same is true for startup teams. You have to discover people who are great before others discover them. Think about it. By the time someone is great and discovered, it's very difficult to recruit that person to your startup. Incumbents like Google, Facebook, or your local big tech company have much more money to lure them, as well as less risk and more prestige. So how do you get the right undiscovered talent to work at your startup? There are no absolute answers, but at least five factors contribute.
The first factor, you must recruit all the time, whether you have openings or not. You should have a hiring forecast and allocate a specific amount of time to recruit constantly. Generally, I recommend founders spend at least 15% of their time on recruiting, regardless of the hiring plan and how many openings there are. There are big advantages to this. One, for every given role, you can talk to lots of new people who've done the job or might do it, which will help you test what you really need in the perfect candidate. And when it's time to hire someone, you'll have a huge headstart.
The second factor, you want to know what great undiscovered talent looks like, one person at a time. A great startup employee has five key characteristics. They're tenacious. They'll go over walls, under walls, through walls, or blow right past apparent walls in order to make important things happen. They'll also learn quickly and without much instruction. You could throw them into the deep end of the pool and they'll thrive without swimming lessons. They'll be incredibly resourceful. They'll think like an owner and not an employee, which means they'll take 100% accountability for coming up with answers, even when the path is unclear. They'll thrive in a chaotic, unpredictable environment. And they'll be out to prove something.
The third factor, you want to find the right type of undiscovered talent for your early team. Many candidates who would look great on paper, would fail in a startup. Keith makes an important point about this. Usually, you want to hire for aptitude more than experience because you're recruiting for unbounded upside.
In his experience with PayPal, Keith notes that the people on the startup team rarely had experience in payments, except for the general counsel. Usually the role in a startup is primarily about creating new value that hasn't been created before, but occasionally you'll need someone more experienced, someone who could ensure that you're not undermined by avoidable mistakes, legal issues, or lack of compliance. In other words, when you need upside, hire for aptitude. When protecting against downside, hire for experience.
As I've mentioned in Lessons of Greatness about why founders are artists, great startup teams are like improv jazz bands. These bandmates are comfortable with ambiguity, open-ended goals, and a lack of general direction. These types of musicians are everywhere. Many are currently working in a soul-crushing job in a big company and would jump at the chance to do what they think is great work and to be unshackled in their pursuit of it.
You might be wondering what kinds of interview questions you should focus on when you recruit for your improv jazz band. Well, a few things can be helpful. One is, you want to ask about ideas that they've taken from start to finish, even if they're different from the current role. You want to figure out if they're capable of strategic thinking. Would they be able to keep your startup's entire business equation in their head, rather than just think of their job as a silo? You want to learn about whether their strengths align with the risks facing the company because if you take on the most important risks you have right now, you want to know that they'll complement the abilities of the current team. These are just a few of the questions that should help.
The fourth factor, you want to make an undiscovered awesome people list. I call this the UAP list, for short. Each and every person on your startup team should start with a list of at least 10 people who they think have the traits that could make them effective at a startup. When you recruit someone new, you want to get their list as well. Even better, get their list when you're recruiting them as part of the interview process. And when you talk to your smart friends, don't be shy about getting their list too.
Even if the people on your UAP list aren't a fit for your startup right now, it's helpful to visualize the possibility that they might be in the future. You want to proactively keep in touch with these people through time. You could strike when the opportunity materializes. You want to be constantly updating your UAP list and then making sure you and others on the team proactively meet people on that list as part of the ongoing time you spend recruiting.
The final factor, you have to sell people to join your startup all the time. Just like an artist moves people to abandon their logic for the love of something with higher meaning, you want to get PR that helps you recruit, and not just for getting customers or market positioning. You can also use Twitter to get people excited about your startup's mission. If you follow Austen Allred, of Lambda School, you could see a master of this inaction. He does a great job transmitting the types of messages about Lambda School that will be a magnet for the types of students and employees he wants to recruit. Twitter is an incredibly powerful tool for getting undiscovered talent to come to you.
And even when someone you want turns you down and you still want them, you should adopt the mindset that all they have said is, "Not yet." You already did the work to determine that they are great. The extra effort of calling them once every month or every quarter is trivial. You'll be surprised how many people ultimately decide, "You know what? The founder of this company keeps calling me. Maybe that's the place I ought to be."
So what does this mean for you? Some of you might be thinking these ideas are pretty obvious, but the fact of the matter is, most startups are unimaginative in their recruiting. When they have an opening, they wait until there's an opening before they look for somebody, and then they spend a few weeks searching LinkedIn or rely on recruiters or go after established resumes. When you really think about it, it's inspiring. Realizing that most startups recruit in the same unimaginative ways can open your eyes to the fact that you can apply your insight to recruiting, just like you could apply your insights to a non-consensus startup opportunity. And when you get this right, you'll have a massive advantage over the other people who have not committed to greatness.
So in closing, I ask:
Who's on your undiscovered awesome people list?