There is no one answer to the question “When should I start hiring employees” that works for all startups. The first hire for startups should be when you know exactly what they’ll do all day, and you can’t continue to be successful without it. As you begin working through the steps to take your startup from dream to reality, you will need to think about your startup hiring plan. Although there is no one answer for every startup, we can break it down by looking at what positions are likely to trigger that first hire.
Key Positions In A Startup Company
Let’s look at some of the most common times and positions startups may need to hire an employee. Even though each case is different, there are some common trends.
A Second You
In many startups, building a functional prototype is the step that triggers when to hire your first employee. Most startups will need a working sample in order to secure funding and start marketing. If you don’t have enough hours in the day to build this, now’s the time to hire your first employee. This employee will likely be someone with similar skills as you, the founder, and they may actually become a cofounder in some cases.
A New Skill Set
For other startups, the first employee may need to have skills the founder lacks. This may be someone with manufacturing expertise if you are building a physical product. Or, it could be someone with branding and marketing knowledge to create a user-friendly interface, especially if the founder has little front-facing program experience.
Help to Grow
Some startups are able to produce their product and get it ready to launch without needing to hire additional employees. In these cases, it may not be time to hire until the startup is running and it’s time to focus on growth. At this point, your new employees may need to be geared toward identifying new revenue streams, social media advertising, or customer support to make sure the startup doesn’t miss out on important growth opportunities.
How To Build A Team For Startup
Now that you know the basics of who and when to hire, it’s time to focus on adding to the team. Just like with hiring the first employee, you do not want to hire additional team members until you know what you need them to do all day, and that those tasks are needed to support the goals of the startup.
Ideally, you want to hire for a specific skill set. Dividing tasks so you know what kind of employee is needed can help make this clearer. For Software as a service (SaaS) companies, looking for a programmer in a specific language to work on a defined development goal is a good way to begin building a team. Feeling desperate to get more bodies in chairs because you need general help with everything is not. You may identify several different areas where help is needed, and be able to hire an employee who can wear many hats within the startup to fill those specific roles. Once you have a clearly defined role or roles for a new team member, the question of “how to hire employees for a startup” becomes easier to answer.
How Many Employees Should A Startup Have?
Exactly 7. Just kidding. The answer is much less satisfying, but ultimately more helpful: the number you need to get the work done. It can be helpful to think about the overall point of employees at a startup. Essentially startups only want to hire someone if they can make the business more money or save the business money. It is important to think of the tasks an employee could do within the specific startup that would achieve one of these goals. Here’s a checklist of things a startup might experience that shows the need for additional employees.
- Cashflow allows you to pay them and there’s enough work to keep them busy
- Product is suffering/customers are complaining
- Turning down work due to lack of time
- Daily bookkeeping or paperwork is piling up
- Using more than one freelancer or contractor because of the volume of work
This list can also help answer the question “how quickly do startups hire?” because it has the same answer as how many. Each startup will start to encounter issues from the above list at different times. For some, it will be before they can launch, and for others it may be weeks or months after they form. It is much more useful to think about the role an employee needs to play within a specific startup, rather than to rely on a set of rules developed by someone in a different situation.
Next Steps on the Startup Journey
Next Studios specializes in helping you tailor a plan for your needs, rather than simply checking boxes. We use our tried and tested approach, using the Lean Startup Methods, to guide startups from an idea, to a precise plan, to using that plan to secure funding and launch successfully. Check out NEXT Up, our program for new entrepreneurs and start learning how to use our experience to make something that works for you—and apply today. It’s free to apply!