The first few employees at your startup are crucial. They set the tone for your company and determine whether you fade out or make it to the next level.
“Hiring the right people is absolutely critical in the beginning, because each person you add will have a significant impact on shaping what will—and won’t—be valued, and how people will behave,” says Chris Cancialosi, founder and managing partner of gothamCulture, a New York-based organizational consultancy.
We asked Cancialosi about attracting and selecting employees to create the right corporate culture from the start.
How can founders hire for a corporate culture that doesn’t yet exist?
You have to be very clear about your values. You need to sit down and say, “This is how I think business should be done, this is what’s really important to me, and this is what my company is going to stand for.” These are critical points that people need to identify but rarely do. As a founder, you have to determine what “right” looks like before you can build a team around it.
What makes those qualities evident in early hires?
I believe in attitude over experience. You can train people to do tasks, but you can’t train them to have the right attitude and values. We have a rigorous, five-stage recruiting and selection process that every employee goes though. There are specific things we look for, and we make it very laborious for them, so the people who aren’t truly interested just kind of self-select out. We’re assessing for those values and intangible qualities that are not found on a résumé.
What about diversity?
One mistake founders often make is to look for people who are clones of themselves. While that helps in aligning behaviors, the downside is that you look at every problem through the same set of glasses and leave yourself open to a lot of risk. Hiring people with diverse viewpoints will help mitigate that risk.
How do you attract those first employees before the cash gets flowing?
There’s no blanket incentive that works for everyone. Equity stakes—giving them a piece of the company—always gets people’s attention. Some people value a flexible work schedule; some are totally incentivized by cash. You have to consider what motivates different people.
At gothamCulture, everyone is on a partner track, so they all see that long-term goal. We provide short- and long-term incentives in terms of bonuses for the people who are cash-incentivized. We basically have unlimited vacation: Our people work hard and have clear goals, and they’re compensated on hitting those goals. So if they need vacation, they take vacation, and nobody asks questions. We also have an open compensation model so everyone knows what everyone else makes; there’s no jockeying or negotiating for salary. We try to do things that appeal to a broad range of individuals.
Can just one or two founders create an effective hiring process?
It’s hard because there are only so many gates you can put people through. But you can still create a process to screen every potential hire. As candidates progress through our cycle, each event is designed for a specific reason. There might be tests to see if they can do the basics of the job, and there are behavior-based interviews to assess for values and culture fit. It’s important to identify the skill sets and values that will make people successful in your business, and then be very intentional about assessing those assets throughout your recruiting process.