It’s no secret that the startup landscape has transformed dramatically. In the wake of the pandemic and other global disruptions, we’ve learned crucial lessons about building resilience through talent acquisition and management. Companies that have evolved their hiring practices are meeting their moments with more adaptable, resilient teams.
Through our work with countless startups, we’ve seen firsthand how the right hiring approach can make or break a company’s trajectory. Whether you learn these lessons through experience or take our guidance to heart, the fundamental truth remains: hiring mindsets need a reset.
Before rushing to backfill that open position, pause and reflect. What problem are you actually solving? Is the ideal candidate profile different now than it was six months ago? You may need to completely rethink how, who, and where you make this hire – or whether you should make it at all. Perhaps outsourcing would be more strategic, or maybe emerging AI capabilities allow you to automate routine tasks and hire for critical expertise instead.
Here’s a reality check: not every hire will see your mission through to the end. The key is hiring for your next milestones – this will naturally right-size who you hire and why. Accept that hiring mistakes will happen, and focus on becoming excellent at course correction when they do. For early-stage companies especially, your next three hires can dramatically accelerate or delay progress. The initial team sets the tone for your entire venture’s success.
While evergreen recruiting has its merits, sometimes relentless focus on priority hires – done with high quality – is the best approach to securing critical talent and expanding your reach. Perfect hiring decisions don’t exist. You will misread hiring needs, miss red flags, and lose great candidates for reasons both within and beyond your control. The solution? Have a clear plan, understand why you’re hiring, know how it impacts your bottom line and future goals, and course correct quickly when things go sideways.
Determine where AI fits into your future workforce, and how it changes your hiring needs.
While technological advancement has consistently reshaped labor markets, AI’s impact is uniquely accelerated. Unlike the gradual transition from steam power to electric motors, AI transformation is happening at unprecedented speed, layered over multiple disruptions. This presents a rare opportunity for startups to get on the offensive with AI implementation – they can experiment and pivot far more nimbly than enterprise organizations. Think turning a kayak versus a cruise ship.
We’re likely approaching a future where we’ll look back and say, “Remember when customer support, content creation, and data entry were done by humans?” While AI isn’t a universal solution, companies that prepare today for an AI-enabled future will create focused, forward-thinking approaches. Your customers are evolving too – their familiarity with AI tools in their personal lives is rapidly increasing their AI literacy.
There are two distinct paths for AI integration: automating human activity or elevating new human capabilities. When leveraged effectively, AI can save time by handling mundane tasks and improving decision-making through enhanced data insights. However, this depends entirely on the quality and quantity of data available to power AI functionality.
Consider this example: A rapidly growing SMB SaaS company, “Banana,” provides software helping high-end restaurants create personalized customer experiences. Their customer base is expanding faster than their ability to onboard effectively. Rather than simply hiring more onboarding staff, they took a step back. By mapping the customer journey and measuring behavior, they discovered that customers who complete onboarding in 20-25 days with training resources provided within 48 hours show 30% higher long-term adoption rates. The solution wasn’t just adding headcount – it was reimagining their approach through AI-enabled customer operations.
Explore hiring differently — such as with offshore solutions.
Startup CEOs have increasingly turned to offshore staffing solutions, attracted by lower labor costs, third-party management of employment regulations, reduced overhead, and access to specialized expertise. However, the results have been mixed at best. Before jumping into offshore hiring, complete this critical exercise:
“I am contemplating outsourcing _____________ because it will allow my business to ________. This will require changes like ________ to my daily operations and organizational structure. This could elevate customer value through ______________ and potentially dilute it through ___________.”
Consider which functions are core to your business strategy versus critical for tactical execution. Outsourcing strategy is expensive, while outsourcing commodity work is not. Evaluate what needs careful interpretation and whether there will be barriers to doing that effectively with an offshore team. Who will oversee these teams, and where do timezone differences become an advantage rather than a burden?
Recent global events have highlighted the importance of carefully considering potential volatility in offshore strategies. From software engineers in Ukraine to designers in Argentina facing new labor laws and unions, external factors can significantly impact your operations. While history never repeats exactly, it often rhymes – these challenges remind us to build redundancy and flexibility into our offshore strategies.
Importantly, pay attention to the quality of treatment of offshore employees. Whether hiring through a third-party vendor or directly, understand the end employee’s compensation and benefits. Ensure you’re creating equitable hiring practices across all locations.
Hire for the milestones, not the mission.
Consider a legal software startup whose mission is to transform how small law firms operate. The salesperson who can take you from $1M to $5M ARR is fundamentally different from the one who can scale your sales force to bring in $50M ARR. The latter might have experience with well-resourced teams, mature products, and established playbooks – but that could be counterproductive at your current stage. If you don’t hire for the moment, you’ll miss your milestone and have no mission to see through.
Your mission is your organization’s overall purpose. Milestones are the significant achievements marking progress toward that mission. While mission alignment is crucial, hiring solely based on mission alignment can lead you astray. Take “Indigo,” a Series A startup with $5M in funding and 1M monthly active users, whose mission is to empower global communication in indigenous languages. Meeting their milestone of reaching 50M MAUs by 2028 requires specific expertise at their current stage – not just mission alignment.
Not every brilliant professional who believes in your mission can reach your next milestone fast enough. The marketing leader who took Duolingo from 300M to 500M MAUs might seem perfect, but their experience at that scale might not translate to your current needs and resources.
Early-stage companies face unique challenges in aligning talent acquisition with their broader mission while under pressure to hit short-term milestones. They’re often resource-constrained and need to hire someone who can elevate their capabilities, yet they may not have the budget to do so. Additionally, these companies need thought partners in hiring who will challenge their assumptions – sometimes what appears to be a people problem is actually a process or product issue.
The tension between speed and quality is particularly acute. Startups must move with velocity in the right direction, but attention and cash flow are their most precious resources. While they cannot afford to wait for the perfect hire, they equally cannot afford to hire someone who is merely adequate. This creates a challenging conundrum: they need the best possible person as quickly as possible, but often lack the resources or expertise to recruit effectively.
Understand what you are solving, and ensure hiring is the solution.
The landscape for building sustainable startups has fundamentally shifted. With big tech becoming more pragmatic, startups have a unique opportunity to hire exceptional talent without insanely expensive compensation packages. Frugality, often an unsung hero of early-stage companies that have stood the test of time, has become increasingly important. We’ve learned that operational gaps aren’t always best solved with people – careful evaluation might reveal that the real issue lies in processes, product, positioning, or people-training, not a people shortage.
Resilience comes from having scalable systems and maintaining quality as you grow. Don’t let your SaaS become a service business in terms of how you staff and support clientele. Be relentlessly resourceful, even when cash-healthy – it requires exhausting rigor, but it’s essential for maintaining relevance and agility. Building a workforce for the next 2-3 years, and staying sharp on skill gaps and upskilling needs is the way to stay ahead – after all, 20-year tenures are long gone.
Are you ready to reboot your hiring strategy and build resilience into your startup this year? Book a consultation with us today to learn how we can help you hire for both mission and milestones.
