Lovely, chilly, sunny day in the ATX — a great day to discuss how a CEO obtains hiring assistance.
In the last month, I have assisted five CEOs in hiring a top flight C Suite or top management person. These are folks who are in the CTO, CMO, CFO range and in the business development, head of sales type positions.
This is where the maxim, “Hire people who are better than you” is tested. Catchy slogan, but it runs into two problems:
1. Can you actually find such people; and,
2. Can you afford such people?
The answer to the first question is YES. Hire lions. Do not hire cubs. Can you tell the difference? If you were going to war with someone which do you want on your side? The King of the Damn Startup Jumble.
The answer to the second question is MAYBE.
If you are a first time CEO, it is understandably worrisome as to how exactly you do this. In spite of this, I have seen CEOs time and again do this successfully.
All the successful first time CEOs have asked for hiring assistance from a trusted advisor, a boardmember, a CEO coach, or a mentor.
[Pro tip: Ask for help from someone who has actually done a ton of hiring as a CEO. Make sense? Do not ask a 28-year old VC novitiate on your board even if he went to Harvard, drives a BMW convertible, and has mousse in his hair. He has no idea. Get a salty CEO who has done this for a quarter of a century. A salty CEO can smell a phony.]
Do not go it alone.
What do you ask for, Big Red Car?
In seeking hiring assistance, just blurt out what you are trying to do — “I need to hire a top flight Chief Financial Officer to lead our financial endeavors, wrestle with growth, and keep me on the straight and narrow as it relates to runway.”
[Pro tip: Make the company and the CEO stronger with every hire. Make every hire own some part of what the CEO is currently doing. Make your job easier.]
It is important to get a job description or a basis of employment document sketched together with a set of 6-month or 12-month objectives. Every minute spent here will save an hour later on. [Bit hyperbolic, but you get the idea.]
Job description, objectives, organization chart. With this small amount of work, you can get the assistance that you need.
Most of the asks I receive get down to someone the CEO has identified and the CEO is looking for a final thumbs up or down. [In the last five such requests, I gave four thumbs UP and a single note of caution. In the case of the note of caution, another candidate was waiting in the wings.]
What does the adviser do?
The adviser takes a look at the candidate’s LinkedIn, reviews any correspondence between the CEO and the candidate, gets a sense of the duties (job description document), the compensation package, the short term objectives, and the growth implications.
When hiring anybody, a CEO has to ask two questions:
1. What can this person do immediately?
2. What is this person capable of doing over the next five years? What is their growth upside? <<< This is an important question in many areas. Hire a Financial Controller and three years later need a Chief Financial Officer? Very common progression. Can this person grow from Controller to CFO? Hmmm, maybe not.
The adviser has to spend the time with the candidate to be able to make a credible recommendation to the CEO. When the ask comes in, it usually sounds like this, “Can you spend fifteen minutes with someone I’m thinking about for a new head of sales?”
The adviser-candidate Skype — yes, Skype — will last a couple of hours if done correctly. A shrewd adviser allows enough time for the candidate to relax and get out of the “job interview” mode. Relax, God damn it. Ooops.
The adviser wants to ensure that the candidate has the same sense of the job as the CEO. I always make a small mistake and let the candidate correct me. Something I learned when being trained to interrogate POWs.
I always like to ask the candidate what they think of the company and where the candidate thinks the company can be in five years.
Be prepared for a lot of “jargon” and at least three “take them to the next levels” but let the candidate speak.
Got any tips, Big Red Car?
Yeah, dear reader, I do.
1. Do your homework and know what the CEO is looking for. Know who the CEO thinks she is hiring.
2. Spend enough time with the candidate to get all the startup mojo out and for the candidate to relax.
3. Share a bit about yourself. Guess what? If you tell a person what you think about Ramen noodles, they will tell you what they think about Ramen noodles.
4. Get beyond the “My worst shortcoming is I care way too much” bullshit and figure out why this person wants this job.
5. Imagine the CEO working with this person — is there a chemical fit? Is there a culture fit?
6. Make the hire subject to a probationary period — I used to use 90 days for a salaried person and 180 days for a part time person. You have to allow enough time to get to see the hire in action.
The purpose of a probationary period is to ensure both of y’all are keeping score, and to make it graceful to terminate somebody who doesn’t work out.
7. In a startup, do not be afraid to make a part time hire, but know beyond a reasonable doubt how much time the person is going to invest in your company. Know what it will take to convert the person to full time and have that negotiated in the original hire. Listen to me. Read that again.
[Pro tip: Make this the numbers of full days per week, not hours. You can see a person on a given day, but you cannot really see if someone is in their PJs working for you. Make it easy on yourself.]
8. No equity until the probationary period is over. Allocate equity from the option pool. A very small amount of equity goes a long way. Of course, make the equity subject to vesting and a company buyback if the person ever leaves the company.
CONSIDER PERFORMANCE BASED EQUITY — the new hire gets it when they accomplish some specific goals. This works well on business development positions and sales.
I am amazed at the level of talent ranging free, but ask yourself why this person is even looking for a job. If the person isn’t looking and they are being recruited — better juju.
Make a damn decision
I see a lot of hiring that dies of its own inelegance. If you came to hire somebody — hire somebody.
When you have touched all the bases — LinkedIn, references, resume, credit check, criminal background check, work history, interview, adviser chat — MAKE THE HIRE.
Hire fast; fire faster. If it doesn’t work out, cut your losses and move on.
This is a seduction and there is a time to hold hands and there is a time to make the plunge.
Advisers — write the CEO an email the second you end the Skype session. Do not make the decision wait on you. Do YOUR job.
Last word. The Monkeys Fist Test. There are people for whom hiring is an instinctive super power, just like there are people who can tie the Monkey’s Fist/Paw/Hand (lots of different names for this knot which is affixed to the end of a line so it can be thrown a long distance). Know this. Here is a MF. Can you spot the flaw? It was made that way on purpose. I tied it.