Hiring the right leader during the early stages of a company can change the destiny of the company. I’ve been at Lightspeed for over four years, and this is something we have talked about constantly.
It’s difficult to make your first 100 hires. It’s harder still to make your first 25. These people will form the foundation of what you’re trying to build. Companies are going to market faster than earlier and founders have become braver and are building products for the global consumer from day zero. Hence, the time to succeed or fail has been squeezed further, and it is imperative that founders build the right teams upfront. We are in a unique position. Despite economic headwinds, we see consistent growth across the world, and building the right team can be the difference between surviving and thriving.
A good example of hiring right is OYO Rooms. In 2014 Ritesh Agrawal, Founder of OYO, hired Abhinav Sinha as the COO, and the rest is history! Ritesh could have easily decided at that point in time to hire a profile that was more suited just for that stage. However, he was able to visualise the early growth trajectory of the firm and why someone like Abhinav was the right answer long term. Also, Abhinav was able to attract high-quality folks like him, thereby creating a superior quality org and OYO never looked back.
So, how can you find your very own Abhinav? Let’s walk you through what you need to know before you even start writing the job description on your scribble pad.
Before we talk about these nuggets, there’s something you should remember. When building a company, the onus is on you, the founder, to sell the story and get the listener to buy into your vision. Founders with the ability to articulate their vision with clarity have a big advantage. If you are not a natural at it, work on it. Selling is important, but impactful selling is the key. Once you’ve perfected your story, it’s time to get to the drawing board. How do you think about hiring?
1. Punch above your weight
Very few founders aim high while hiring. Most fall into the trap of hiring for the current stage or the immediate problem statement. While you need people on the ground to execute your vision, you also need leaders to provide directional guidance for future growth. Think of the early leadership team as your founding team — people who will be around ideally for a decade or more — and then decide to hire.
We have consistently seen founders aim low, hire for the current stage, and be back in the market within a year to hire the next person for the next stage. The issue with not getting a leader who has the vision for growth or a larger picture view of the business is that the founder keeps getting pulled into everyday functions constantly. They’re left with little to no time to focus on building the business. Founders with a longer-term vision also need to hire to fulfil that vision.
As an example, a very common conversation we have with founders is the need to hire a technology leader as part of the founding team. The reason we believe a tech leader helps is that they’re able to understand the business and suggest how technology could disrupt the status quo rather than just ship products. Not to mention the ability to scale teams at early stages.
2. Doers not delegators
Hustling is important in the early stage of your journey. Putting all your focus on solutions to get your product to market makes founders embrace the chaos of this stage. So even while you find leaders who will take you to the next stage of growth, look for people willing to get their hands dirty while doing so. At an early stage, you need someone who can walk the talk. People who are ready to do whatever it takes to get stuff done, and fast. Most of the time, it would mean not slowing down the firm but folding your sleeves to do it yourself.
For instance, in an early stage agrotech firm, a CXO-level person should be ready to talk to farmers or be the first sales leader, make pitch decks, set up the demand generation team, and deliver pitches to lead from the front.
One hack is to find ex-founders or people who were among the first 20 hires at a firm in their most recent roles. Often, experienced hires who have not been part of the chaos in the early stages will seek to delegate or get slowed down because they have not done it themselves.
Founders often look at just profiles and not the journey that took potential hires there. And the journey is important. We’ll talk about this in more detail soon.
3. Look for the outliers
When you look at the background of most successful individuals, you will find something interesting in their journey that will hold your attention. For example, someone could have risen against the odds without resources available to them. Or they may have given up cushy jobs or moved cities to take up something more challenging and outside their comfort zone. Agility and their ability to learn are the two qualities that you need to see in order to assess potential.
If you go beyond the JD and the functional aspects of the role and are ready to know the person across the table, it will become easier for you to spot and onboard these “outliers”. Once they come on board, these people will surprise you with their ability to outperform the rest. They are the top 1% you need to find. An ideal candidate may not have worked in the area you are hiring for, but there will be enough clues about their ability to adapt and learn quickly.
4. Generalist vs Specialist
It is undoubtedly tempting to want to hire specialists from the beginning of your startup journey. But companies, when they are young, and still finding their feet, need to understand which function requires a specialist versus a generalist. If you’ve been with us so far, you have no doubt caught on to the fact that flexibility is a major requirement when you’re in the early days.
But there are roles that will just not do without getting the best in the field. In a fintech startup, for example, you will need a domain specialist from day one, guiding you on regulations that need to be part of your design.
Most startups are trying to solve problems for the first time, so for a specialist, the playbook may not be well-defined. At a broad level, your early hires should all be first principle thinkers, very open to experimenting, and able to quickly move on from failures.
5. Alignment to values
Values are behavioral traits that define your work ethic and at an organizational level build the fabric of guidelines. And they flow from the top. Finding leaders who have coherent value & belief systems is of utmost importance. Building it from the beginning makes for good, solid businesses that stand the test of time. How do you find people in your leadership team who align with your values and your culture?
Try to observe how people make decisions when pushed against the wall. Some candidates may come with stellar records, but be extremely uncomfortable to work with, hence culturally their teams will have a high churn or people from their previous organisations would have not followed them. We often suggest walking away from such hires.
But the other thing to remember is that potential hires will also make decisions to work with you based on how you project the values of your organization. The selection process runs both ways. For instance, you are considering a senior candidate who has applied for a leadership position, but nobody in your team can meet with them at the scheduled time. Let them know, ideally personally. Let’s assume you forget. Irrespective of whether you hire the person, make the time to get in touch and apologies for the missed communication. Candidates will also assess you and your organizational values before they decide. Nobody likes to be ghosted.
Building a team is difficult. There is no universal playbook to build the perfect one. Approach your early leadership team to help build on your ambition. On board people who will not just agree with everything you say, but challenge you to widen your horizons as you grow. Think of them as people who will help you become a 10x better version of yourself. There are nuances to understanding the right hire. We intend to go deeper into this subject over the next few weeks and months. Is there a quality you looked for when you made your first few hires? At Lightspeed, we always want to hear from you. Connect with me here or email me at siddharth@lsip.com.
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