We've all heard how tough it is to be an entrepreneur (if you don't believe me, check out my new favourite presenter - Tara Hunt). So, the saying goes, hire the best people you can possibly find and get out of their way! Sounds easy. Step outside your office (or your parent's basement or garage) and hire everybody you see...Ya right.
The most important factor in attracting the top people is to actually "attract" the top people. Like it or not, you are the creator of your company's culture and if that culture thrives on change and supports an innovative approach to the sharing and evaluation of new ideas, you have a much better chance of finding and hiring the right team. Eric Ries has been able to capture this flavour in his new book The Lean Startup.
Compensation. Yep, I said it out loud. Founders need to understand some basic math when it comes to attracting powerful team members as follows:
Tuli Uongozi rule for Compensating your Starz
Compensation Index = the compensation this candidate would receive at an established company = 100
x = the salary and bonus you can afford at this stage of your company
y = stock options or ownership participation or profit sharing
If x + y is not greater than 100, you will have trouble attracting top talent.
Sure the y portion won't be earned until later, but if you have the right person, she/he will do their own risk estimation with the hope that x+y will far exceed 100 over time
The established company is your competition and so are other startups for the right person.
It's just like a marriage only better or worse depending on your point of view. The reality is that you will spend more time with your work spouse than you will with your real significant other!
Back to "Goal Divergence", if you are in business to get rich, you likely won't create the right culture and you will attract other "get rich" teammates and you will all make decisions based on profit versus what is best for your customer. If you want to change the world and as long as there is an outside possibility that your teammates will get rich in the process, you can probably create your right culture and attract starz.
When you're starting off, there aren't many people in the office, but you still run into politics. What? You must be kidding me! No, its actually true and the older the people you hire (i.e. my age and up!) the more you will run into some set ways. You need to uncover this in the "getting to know you" (interview) process. Is change their constant or something that they avoid? Is it "my way or the highway" or a collaborative approach?
A lot of people talk about having to manage age discrepancies... but this concept means that you are using demographic profiling whether you know it or not! You might want to consider psycho-graphic profiling just like Pepsi did so long ago... they went after people who "think young" not who are young.
Hire the best people... there is no Plan B.
Disclaimer: Mr T was not harmed in the making of this post and there is no inference real or supposed to the A Team movie.
