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Benefits of a first hire, who to hire, and hiring strategies
Hiring the first employee can be one of the most challenging yet crucial parts of a startup journey. The first hire can set the tone for the company culture, influence its future success, and help achieve goals.
Starting a company can be exciting, yet challenging. Alongside crucial business decisions all founders will make, such as identifying their unique selling point, defining their ideal customer profile, navigating and securing funding, the first hire may be one of the most significant.
In this article, we will explore the things to consider before hiring, the benefits of a first hire, who the first employee should be, and how to make a successful first hire. We also share insights from Daniel Yubi, founder and CEO of Payable.
As founders embark on their startup journey, they may initially operate independently in order to effectively define their vision and carve out their path for future success.
However, over time they may find that certain daily or administrative tasks are taking longer than others. These tasks may also start eating into valuable time needed for building and growing the company in line with their strategy.
It is important for a founder to consider what role needs filling and what is necessary for the current stage of growth. A first hire may help develop the product offering, manage operations to scale the business, and generally develop the foundations for your startup.
Hiring the first employee can provide a range of benefits for your startup, specific to the culture, revenue, investors, customers, and more.
Finding someone who aligns with your startup's values, mission, and vision can ensure a better fit and higher job satisfaction for the employee.
It is important for a founder to clearly set out what their vision is early on and how the new hire can help achieve that. They should effectively communicate the benefits and opportunities that come with working at the startup.
This was the first question that Daniel Yubi posed:
“[It is important to know] how do you sell that vision so they [the new hire] can believe in something they want to build, and mostly when it's a new category...”
Employing someone with varied skills and expertise can give your startup a competitive edge and help you achieve your business goals. Alongside valuable experience, if a new hire is self driven and proactive it can further drive the company in the early stages.
First hires may be key to success, or contribute to getting the company there.
According to Daniel: “If you find somebody great that can join and scale the company, then go for it”.
A successful first hire may help save costs in the long run and provide a higher return on investment for your startup.
Founders will also need to evaluate the opportunity cost of hiring a new employee. This refers to the value of the next best alternative that is given up when making a decision. In the case of hiring new employees, it involves considering the potential benefits of investing resources in an alternative option (candidate).
As Daniel discusses:
“It required some level of understanding at the beginning. I remember we went to hire someone and I felt it was expensive and I didn't move forward… I realised the opportunity cost of not hiring that person, like, you say, 'Yes, it's 10k more expensive but the opportunity costs of not having that person the next three, five months because you found someone that is great is just crazy.
Because you shouldn't be hiring for the next two or three months, you're hiring for the next year, year and a half, right? And then ideally all of them can go for the next four or five years.”
Hiring someone who can complement the culture that a founder has already built, or help establish it, can have a long-lasting impact on the company's success.
When hiring, a founder may not just consider a person’s skills and expertise, but also if their own work values and style align with the startup.
A good cultural fit can help increase happiness at work and yield significant benefits for the company as a whole.
Your first hire can influence the team's dynamics and how effectively the team works together to achieve its objectives.
The first hire may help determine the next hire(s) to follow based on business need and growth.
The right first hire can help attract investors and customers to your startup, as they can serve as a testament to your company's potential for success.
The first hire may vary depending on the specific industry or nature of the business. It is essential that founders seek top talent to build a strong employer brand.
Some of the first hires may include:
From the early stages it is important to have a structured hiring plan for your startup. This helps assess the skills and fit of an employee before hiring them. Having an effective hiring strategy is essential for scaling and success.
Founders can begin hiring for their business in the following ways:
Legislate enables you to create, manage and sign agreements all in one place. This platform helps centralise contract management and enables you to have visibility across all contracts.
