Hiring your first 20 employees is such an important endeavor, but for many reasons it’s a very unique type of hiring. Let’s start by normalizing some of the discomfort. First, it’s hard. Your brand is unknown, your product is fledgling and you’re asking folks to buy into your vision and take a chance on building your dream. Second, you’re trying to stretch dollars and it can feel both intimidating and risky to spend that much money for the first time. Third, it’s wildly time consuming for founding teams who are acting as jacks/jills-of-all-trades and it can be very discouraging because conversion rates aren’t 100%. That feels especially defeating when you’re hiring in small numbers and spending so much time doing it.
But, these first 20 hires carry a lot of weight.. These are the employees who really join hands to get your product off the ground and generate early revenue. They free up your time to be a more effective leader/founder. By nature of tenure and legacy, they’re also the early cultural ambassadors of your organization, making it especially critical to get that part right for the benefit of your future culture.
Who to hire:
Who to hire isn’t one-size-fits all - it depends a lot on the strengths (and gaps) of the founders and founding team. The exercise outlined above will help you determine the right hires to hire to (1) fill skills gaps on your founding team and (2) who to hire to take the right things off your plate so you can focus on the highest leverage things.
**Normalizing the discomfort: This means you will be hiring people who are doing some things that you are doing yourself today - get comfortable with this and be prepared to truly delegate so you can lean heavily into what you’re uniquely qualified to do.
A rough framework for order of hires:
The first thing you’re focused on is your product before you think about generating revenue, so by nature of that order of operations, initial hires will often be engineering and product. These are usually individual contributor (IC) engineering or designers who are high IQ/EQ, culturally aligned/work well with the founders and are general problem solvers. Then early sales, marketing, and customer success come behind, in that order. As you scale, you’ll add operations. This isn’t exact - to my earlier point about where the founding team is uniquely qualified, you may have a need to hire sales and marketing together and if your founding team is lacking in expertise on the “practical business of running a business” you may prioritize Ops much sooner. This is just a basic guide.
Those initial hires will either scale up to become your initial functional heads, or you will hire external leaders to come in above them and run each function in the cases where your initial hires can’t scale up. Inevitably an initial hire won’t scale up and that’s not a reason to avoid hiring a strong individual contributor who is ok remaining an individual contributor.
In SaaS especially, marketing, sales, customer success, engineering, product, and operations will be the primary departments - for non-SaaS companies, this may look a bit different, especially if you’re hiring for bio-tech, climate, or developer tools with a strict PLG sales motion - that said, while the roles themselves may look different the attributes below will remain the same.
Getting it “right”
These earliest hires must have the ability to come into your company and see nothing but “green fields” and turn them into the Gardens of Versailles. People often say early hires need to show “resilience” or “ability to work with ambiguity” - and this is true because for better or worse, you won’t have tons of time to enable and develop them, so you should focus on people who have either experienced your scale/domain before, or are exceptional problem solvers and don’t need processes and extensive support to perform.
After an interview you should be able to answer the following questions.
Can this person have the impact we identified as critical for the next 12-24 months? (meaning are they exceptional problem solvers who don’t need process and support)
Has this person successfully had a similar impact elsewhere? (meaning they have successfully experienced your scale and/or domain before)
The answer to one of those questions must be a resounding “yes.”
Can you make this person successful with the time you have to allocate, (often very little) and personal skills you can contribute to their development (possibly very little - remember you are hiring for your own gaps in many cases).
There are three other areas that make sense to consider for your earliest hires.
Leadership: At the very least these hires need to lead themselves in some ways. That said, most of your early hires will join as individual contributors, often with the goal that they can scale up to lead, train and mentor people and teams as you grow. For example, Jon Todd at Okta became the early engineering leader and ultimately moved into an architect role. First leaders aren’t meant to scale forever and many of them won’t want to. You should try to prioritize this for early hires, though, because as teams grow you will want these people to take the lead on the hiring process for their growing teams…you need to be able to scale team growth and these earliest hires should be major contributors here. (Note: this may be obvious, but avoid C-level titles at this stage for first time leaders. First, it’s often just silly but more importantly it’s hard hire above them later and you create unnecessary friction/demotions when you scale past their leadership but in many cases, will want to keep them in the organization)
Hire people you trust to be cultural ambassadors: To my earlier point, your early hires must perform well, but they will also help shape the culture of your company. They’re the ones who can be figureheads for the business and embody what your company stands for. When your company reaches 50-100 employees, they’ll naturally be the ones who everyone knows — regardless of what department they work in. They’ll also be on a lot of interview panels in the early days as you grow the team, so it’s important to ensure you hire the right cultural ambassadors.
Opt for utility over hyper specialization: hire generalists unless you have a specific and very particular need. Whenever you can regain a chunk of your time to focus on higher leverage things, it’s incredibly valuable to your company.
Hiring for sales, specifically
Your first 20 employees will very often include your first sales person - especially if you have some revenue or customers already through founder-led sales and you know the product can sell. The profile of your first salesperson isn’t one size fits all, either.
You might consider an AE. In that case, you’ll want to have a sales process very loosely defined through your own efforts so you can set a first sales person up for success: This doesn’t need to be wildly robust and may include:
Overview/summary of your company/product/vision
Ideal customer profile and buyer personas - where did you see most success when selling yourself?
Lead-gen strategy identified or an initial lead list created/purchased
Key performance indicators - ie: how do you need this person to perform to be successful - what are the outcomes?
If you have a long, complicated, or more technical sales cycle SDR’s can be very strong partners for your first salesperson/AE or for you, a salesperson-founder (in lieu of a sales hire) because they can make a small or one-person team way more productive by focusing on cold calls and following up with leads.
Again, it’s very important to know what impact you want the person to have and what skills you bring to the table.
A high bar
A high bar is important and you should not bend on this. Be sure that your bar is based on outcomes for the role and not insurmountable expectations. There’s a clever meme floating around of a dinosaur fighting a unicorn in space with flame throwers. The caption read “what the interview was like.” A subsequent image shows two elderly men in a driveway wielding brooms with the caption “what the job really is.” This is funny because it isn’t uncommon. Hire the highest bar people for the problems you are actually solving.
Reluctance to pull the trigger on a candidate for fear of getting it wrong is extremely common.
Hiring decisions are not permanent. Making a bad hire may negatively impact you, but it isn’t irreversible. If you subscribe to the Jeff Bezos Type 1, Type 2 decision making framework, hiring can be a Type 2 decision - consequential, but reversible. If you reverse engineer a headcount model that defines impact and you have a framework for what attributes you need, hiring quickly becomes a lower risk Type 2 decision because you have thoughtfully averted as much risk as you can. This creates freedom to move quickly and experiment with high potential problem solvers, which is important in a crazy talent market.
**Normalizing the discomfort: Being thoughtful about what you need and hiring for the right attributes helps to ensure you come closer to getting it right, but founders aren’t robots and at the end of the day, you can’t control humans. You will make hiring mistakes along the way so try to get comfortable, knowing that the decision can be reversed and your planning and preparation make that possible.
In summary, if your earliest hiring feels hard, you aren’t alone. It is hard. And in many cases it won’t be fast. Leveraging simple processes for determining who to hire so you can expedite the process and focusing on the right attributes is time well spent. Good luck out there.