Hiring/Developing at the Early Scale Stage
If you’re seeing signs of emerging PMF / early scaling, you’re getting good at consistently making money - i.e. the “revenue generation loop”.
At Hadrius, we’ve leaned into it - we’ve started looking at other stuff we’re doing to turn it into a loop, since that’s a big part of scaling. Particularly, I’ve found it worthwhile to look at the hiring process as similar to that “revenue generation loop”. Because it is.
One way we can internalize this is by actually describing it in that nomenclature.
The revenue generation loop, distilled:
Lead Gen
Sales/Closing
Implementation
Customer Success
In the context of hiring, this might look like:
Lead Gen → Sourcing
Sales/Closing → Closing
Implementation → Onboarding/Development
Customer Success → Management
Each of these pieces is important to building a killer team. Most startups at the emerging PMF / early scaling stage develop the sourcing/closing section generally well, but are just starting to become managers, and barely if ever have a strong onboarding and development program. I have more interesting things to say about these latter two, so I’ll focus mostly on those. But let’s go in order.
Sourcing
Most founding teams have exhausted or will soon exhaust their network by the early scale stage.
You probably don’t have enough of a brand to pull off a full inbound hiring process, so you’ll probably need to put on your SDR/BDR hat and grind.
We haven’t fully solved the sourcing problem at Hadrius, but recently, we hired 4 strong engineers (2 junior, 2 senior) in about a month. The strategy to make this happen was nothing more complex than putting the hours in. At this stage - although you’re starting to move out of it - it still sometimes pays to wear the super-IC hat to move fast, rather than solely the system-builder hat. I try to use this sparingly, since systems are what take you from a few million ARR to several hundred - but in the early scale phase, this is likely one of the best uses of that super-IC time.
We used WaaS (outbound + answering inbounds) and LinkedIn directed outbound to filtered candidates. I think I sourced ~300 myself.
Closing
Awesome people want to work at cool companies. Goes for sourcing as well, but a key way to close someone great is to be a great/cool company yourself. That’s the strategy aspect, at a glance. Tactically, 2 things come to mind:
Run a tight process - we’ve closed a ton of our best people by getting them from the first call to offer in <72 hours (some <24 hours). We can build conviction quickly because we’re opinionated and trust our opinions
Give an offer when the candidate is ready to hear your offer, not when you’re ready to give it. Mid/late in the process, ask the candidate - “if we were to make an offer and the numbers looked awesome - how likely would you be to accept right now, 1-10?” <9 and don’t make an offer yet. The candidate might want to slow down your process a bit, so that they can get multiple offers at once. When you do make the offer - put a 72 hour time limit on it. Running a tight process goes both ways! Especially when the offer is made only when both parties are ready for it.
Onboarding/Development
Just like it’s easy to slow down after a prospect signs the contract and becomes a customer, it’s really easy to put too little time into the onboarding process, slowing down after the prospective hire becomes an employee. But just like this is the time to turn a new customer into a raving champion, it’s time to turn a new employee into…well, a raving champion.
The first 1-3 weeks are incredibly high leverage - it’s where you can turn your new employees into either raving champions of the company, or risk just keeping them in the “talented individuals with potential” pool.
When hiring at the early scale phase, because slope matters much more than the y-intercept, the first few days can help you build up 95% confidence on what that slope actually is. Usually by EOD 2, it’s pretty easy to see where someone is going to stack up.
The things I’ve done that I think have helped turn the folks I’ve hired/onboarded into killers (admittedly - I’m hiring folks to be ICs, not execs):
Before hiring, build up enough of the processes that you want to hire for (say ~70-80%) that you can be the key decision maker, expert, and taste-haver for at least the first few weeks. Remember, you’re most likely hiring at this stage in order to multiply your efforts, and at this stage, that shouldn’t take much more than 1-2 weeks of training
Establish the main 2-3 sources of truth for what work needs to be done, for your new team members - pipeline, dashboard, task list, bug tracker, etc.
As a founder, you’re probably really good at context-switching - you’re probably very comfortable looking at 10-15 sources of truth. It also helps that you have infinite context, having been in the room when the decisions were made behind the things that make up that context.
For our sales team, the sources of truth are: (1) Slack Canvas that outlines topics of conversation for the weekly check-in + strategic processes that are currently happening; (2) Hubspot Deals page for their pipeline; (3) Calendar
For our CS team, the sources of truth are: (1) another Slack Canvas; (2) Pylon for CS tickets; (3) Calendar
For our engineers, the sources of truth are: (1) Linear for “what non-started items do I need to work on”; (2) GitHub for “what in-progress items do I need to finish”
Everything else is a reference encyclopedia to pull stuff out of as necessary, rather than a daily register of new tasks. Have too many things that they need to look at for “what do I need to do today” and things will slip.
Management
Just like the Customer Success function at a company takes an implemented customer and activates them (makes sure they’re using the product often, and in the right ways) as well as ensuring they’re on the right track, the role of the early scale founder-manager is to make sure that an onboarded teammate knows their goals, hits them consistently, and is intrinsically motivated to keep doing so.
A good manager:
Leads from the front: both showing how to do the job and how to exemplify the company culture
Sets/follows up on goals: uses goals to develop the team on a periodic basis, and uses followups to iterate on goals (too high, too low, etc), using the team’s input to set these goals
Shares wins: uses IQ and EQ to hype up the team and also increase urgency when low
Lead from the front
My personal maxim at this stage is that you, the founders, should be the hardest working people on the team. After all - you’ve got the most to gain from an outsized exit, and everyone knows it.
What’s more, by having the folks reporting to you see that you…
Are incredibly knowledgeable in the domain that they are starting to own
Work crazy hard + crazy long
Are really good (aka have taste, know the right answer immediately, etc) and can confer that taste to them the longer they work with you
…it’s inevitable that these folks will become incredibly loyal to you, the company, and the mission.
Set Goals
Every IC on the team should know the % to goal that they are at for the month. Two examples:
Sales - % to revenue goal for the month
Account Management - % to expansion goal for the month
As the founder, you probably know the “% to business revenue goal for the month” by heart, in order to reach your growth metrics - for us it’s 20-30% MoM net revenue growth.
I like using the month as the delimiter, because it’s long enough that folks can have natural breathing room to try experiments, but short enough that the iterative cycle remains tight. And importantly, because people are most urgent in the last week before a goal, this gives you 12 weeks of superhuman urgency a year, rather than 4 weeks in the usual quarterly-goal company.
It’s important, as a manager, to not throw the book of metrics at an IC. I’ve seen firsthand (having made this mistake myself) that this paralyzes the team - they have no clue where they or their team is at, and even what is expected of them. Data is siloed, there are too many fragmented pieces of the “source of truth”, and they’ve got other hats to wear to worry about all this too.
In steps your role - managers exist because they can/should hold complex goals in their head. The more senior, the more complex the goals. ICs have their % to goal “execution metrics”, managers have the “diagnosis metrics” to pinpoint where the ICs are bottlenecked - metrics like NRR, close rate, lead quality rate, loss rate due to product, etc.
Managers can then iterate with ICs with these diagnosis metrics in mind. But the ICs are supposed to execute, not keep 10-15 different goals to optimize within their head. That’s not their job.
Share Wins
Good people can/should develop a little bit of an ego. They’re good, exceedingly good, and they should know it. It’s that confidence that allows them to think they can take on a lot, take it on, and then crush it.
But it’s easy for founders to get caught up in their own IC lives, and the goals of the business, and forget that as a founder-manager, they are Customer Success for their team, in charge of making sure the ship stays right.
The best people want to do good work, see that it has an impact, and want to be recognized for that impact. If you’ve developed people well, they’re going to do good work. If you’ve set the right goals, it’s going to have an impact.
Now make sure that you recognize them for that impact - whether it’s making sure that everyone knows when they’ve made a big win; paying them at/above market; or sharing a good word when they’ve knocked it out of the park with a small detail that indicates they’re building up good taste.
I’ll end with a note - this all sounds very manager mode rather than founder mode. But the truth is that if you’re at early scale, growing at breakneck speeds, iterating on a monthly cycle, and starting to build systems that seem to be working, it’s kind of hard to not implicitly be in founder mode. I’m personally closing deals to understand what sales/expansion systems need to be built, solving customer issues to understand how to build systems to scale this aspect, and talking to customers in general, to understand where the product is today and where it needs to be. That’s all been part of the job. Now, running the hiring/development the team is, too.