Monday, October 20, 2008

Rules of Thumb for Hiring in Start-Up Companies

Bob Warfield over at the Smoothspan blog ponders how Start-Up companies, which should be running lean and mean, are able to cut 10% or more of their staff as they are being asked to do by their Venture Capital investors. He suggests that in a start-up environment, you should never have a single employee that is not indispensable to your success. I agree.

Warfield also provides some good rules-of-thumb for hiring in a start-up environment. Nothing earth shattering but all good reminders. For example:

Hire doers not managers. Look for people comfortable with wearing more than one hat. Don't hire in anticipation of demand.

I think in general we are seeing start-ups being a little bit more responsible in this regard. I can remember during the dot-com heyday that the mantra (from the VCs ironically) was to hire 100 employees at "web speed." 100 people! I always wondered what those employees could possibly be doing.

I still run into start-up companies that have 25 people when they could do with 12 (or 5!) or 35 people when they could do with 20 but admittedly it's not nearly as egregious as in those crazy early days of Web 1.0.

Let's hope that the slowing economy is put to use as a good opportunity for companies to, once again, work a little smarter.


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