Underdog Academy Series - Hiring as a Startup

July 12, 2022

Hiring the right people is one of the most crucial steps in creating and scaling a successful business. Hiring in a startup can be particularly challenging given the limited resources and time constraints many teams have to manage. Many startups are doomed before they start due to fatal hiring mistakes. They either hire too many people or not enough, discover new hires weren't a match for their culture, or things just don't work out for any number of reasons. In this particularly complicated hiring market, startup founders are dealing with added obstacles spanning from a troubled economy to shifting global employment trends.

Since 2014 Underdog.io founders, Chris Muir & Josh Goldstein have hired dozens of employees and learned invaluable lessons about hiring as a startup. To help combat the challenges that come with startup hiring, we sat down with the experts to talk through the most frequently asked questions we get from frustrated founders.

In case you missed it, you can watch the full webinar recording above. If you’ve only got a few minutes, check out these highlights from our conversation:

Let's go to our first question then. So, Josh, Chris, when did you know it was time to start hiring?

We dragged our feet for a really long time. If we had any extra money, we wanted to dump it into the product. We didn't want to bring anyone on that was doing anything business side. But our first engineer actually said to us one day like, “You guys are working seven days a week, constantly doing stuff. Might be useful to bring in someone who can take some of that load off your plate and free you up to work on some more strategic stuff”.

And so that was sort of the the moment for us. We were like, Oh yeah, we in addition to the day to day, we should be thinking longer term, thinking about what what we actually want to build here as a company, what the vision is. And so that was the impetus for us to start hiring. Maybe we should have done it sooner. We probably should have when we are working seven, seven days a week. But it was yeah but it was an engineer of hours that that helped get us there.

How did you compete with the Googles & the Facebooks of the world? How did you build your team knowing there were other places for a good talent to land?

Great question. Our strategy here was focusing on what we had, not what we didn't have. So obviously in the early days and probably even now, can't compete with the base comp of bigger, better funded companies. But if we sort of throw that aside and focus on what we do offer. I think you can still land really great talent, two of whom are on this call with us today. Like focusing on the fact that we're small, the fact that anyone who joins the team will see what it's like to run a revenue funded company. We're completely open with revenue. How much money we make, what our growth plans are, the good parts of the business, the bad parts of the business.

We hired an engineer recently who was very excited about that. He wanted to learn how to start a company and to do it without raising VC money. And so focusing on that has been a good strategy for us. Then also offering equity and and having people bought into what we're doing so that they know that the work they do actually leads to more value for the company, which leads to more value for them. I think that's also worked for us.

Should I do a code test?

In place of a code test, our CTO does a deep dive into code that someone has written. So it has to be a project that can be thrown up on GitHub and it has to be a project that the candidate has either written by themselves or they've produced the majority of the code. Once that code has been shared with our CTO, he then gets on a video call, shares his screen and actually walks them through their own code and has them explain decisions that they made, why they named a variable something, why they didn't write a test for a specific part of the code. And it's pretty easy to suss out whether someone actually did the work there and how technical someone is and how thoughtful they are in decisions that they've made.

So rather than having someone do a code test at home, and submit the final answer without any explanation — instead, we do something live and collaborative that is doesn't require them to invest a ton more time because they've already written the project in question.

This still gives us a chance to see how they perform and how they they talk about work that they've done. We’ve experimented with all different types of assessments and found that this approach feels like a fairer use of everyone's time. Other hiring managers can disagree and speak just as convincingly about why code tests are valuable. And I totally get it. It all depends on the org. It depends on the role. But this is this is how we think about it now.

How many stages should my interview process be?

You need enough stages to know if you want to hire the person. It depends on the role but one thing that we try to do across the board is have a consistent process that we communicate to the candidate. Assuming it's not a 12 round process or anything outrageous, just have a plan, communicate it to the candidate as early as possible and as best you can. Sticking to it is probably more important than optimizing for four rounds or five rounds or whatever that number is.

Should I consider visa candidates?

Yes, visa transfers should definitely be considered without much thought at all. It's not as hard or time consuming or expensive as you might think it is. And it's so competitive that if someone's already here on a visa, then definitely do it. With the fast track approach for an H-1B, the legal fees are not that expensive, and it expands your talent pool in a meaningful way. And those folks are excited to join your team and excited that you invested in them up front. It can be a no brainer. That's a lot of ifs but but if you're an early stage company that's raised a round, it won’t cost much more than what you're already paying people.

What do you wish you knew back then about recruiting?

I think the big thing we've always kind of struggled with is leaning on our gut instinct a little bit. We can fill out a scorecard, but then at the same time, sometimes we just have like an instinct about certain people. And I think one thing we we probably looking back, we probably should should have done more was listen to that little inner voice.

Another thing that we need to get better at is allowing other folks on the team to share their gut feeling as well. Just because someone is not a founder or whatever doesn't mean that their voice is less important. So if someone has a gut feeling that might live outside of the traditional scorecard, I think it's important to figure out a way to empower everyone to share the vibe that they're getting from a conversation. And more often than not, the mistakes that we've made in hiring have been situations where we kind of knew it was the wrong hire, but we needed someone in the seat right away so we just went with it. So our main advice for hiring in a startup is really to pay attention to the details and listen to your gut instinct. Hiring is complicated and there will be a few misfires but the more you empower yourself and your team to listen to your gut, the easier this whole process will be.

Thanks for reading/watching! Follow us on Twitter (@Underdogjobs) for more valuable tips. We’re here if you have any questions.

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