Greetings friends! In this blog post we will be discussing one of the most important aspects of a company, its employees! An employee is anyone who is working for a company, either full time or part time, and is not working as a contractor with your company. As apparent from the article’s title, we will be discussing, When should you start hiring, How to pay your employees, Who you should be looking to hire, and of course, How Many employees you should be looking to hire.
Whom should you start hiring
It’s very common for hustling entrepreneurs to say,
“Oh don’t hire people, do as much as you can on your own, stop working your day job, take the risk, and when you are overworked and you are the bottleneck of your company, then get another person”.
I, on the other side, do not believe the same.
There is only so much a person can do, and a number of skills they can possess. For me? I can’t do anything artistic, unless it’s cubes that are well aligned. My creative skills are bad. If I didn't have @Mike and @Maria by my side to help me out artistically, then The Jar (the artist formerly known as Coding Jar) would have gone NOWHERE! Sometimes you need to let go of your ego, accept that you cannot do everything, and seek the help of others. Now, you are going to say, but Basil, if I need creative input and help on one project, does that mean that I should hire this person for the long term?
Well it depends. If that person is going to be constantly providing value to your products/services, whatever you are selling anyways, then maybe you should consider indeed hiring that person. If, on the other hand, that person would be helpful only once, you could hire him as a contractor for a specific deliverable or project.
So to give an answer to this question, “Make sure you provide the maximum amount of time you can to your company, without driving yourself to burning out, and then start looking for people to hire. Never think you can do everything and be open to seeking help from others! Make sure you clearly define what YOU are doing in the company, not every founder should/can be a CEO!”.
I can already hear the voices of “I am only starting up and I have no money to pay people. Should money be involved? How do I hire?”, which brings me to the next discussion point.
Whom should you be looking to hire?
It is often said that companies are 1% money and 99% the people that run the company. This says a lot for how important first hires are. There are two important factors that should affect your opinion. Familiarity with the person (Are they your friend? Are they a complete stranger?), and Competency of the person.
Familiarity is a very important aspect to consider when trying to hire people. Friends and family are USUALLY people you can trust. This means that you can talk with these people more easily regarding business, and you probably already have some familiarity on how to handle them during discussions. Additionally, it is easier to have people believe in your dream and vision of the company, and maybe even help for no compensation, at least at first. On the other hand difficult conversations could be harder to be had with friends and family, as their feelings could be hurt, and this could affect your out of business relationship as well! So always beware when choosing people to add to your company!
Given the above, working with people you are not familiar with is the exact opposite. You can not be sure that they are to be trusted, and will definitely need monetary compensation to work with your company. It could be easier to discuss difficult issues with them, as you probably will not have the same level of connection with them as you would have with a friend or a family member.
Competency is the next major aspect to consider. I usually split competency in two groups, people who are fast to understand and catch on to things you discuss, and people who need more time to do so. It has nothing to do with how good they are on a specific skill, because fast people, learn fast, and work fast. Skills can be refined, or even acquired, on the work, but you cannot easily train competency. On the other hand, people who are slower to do things, are usually more motivated to do them, because they love being included in the challenging environments that are start-up businesses, so they tend to be more loyal to the company, than fast people.
How Many employees you should be looking to hire
After deciding on your hiring plan on when, how, and whom you need to answer the last question for your company. How many employees do you need?
This is a critical question, tightly coupled with your business model you plan to follow and the growth rate of your business. How fast do you want to deliver, and what EXACTLY is it that you want to deliver.
Given you know the answer to this, you can then try to plan the work that needs to be done for the product to be ready, and see how many work hours it will need. Having the work hours calculated (at least a rough estimate), and the deadline, you could kind of calculate how many resources you would need.
Never forget however, you can have 1 person give birth to a child in 9 months, but you cannot have 9 people give birth to a child in 1 month!
How to pay your employees
This is usually the hardest question to answer. In order to pay people you need to have money, and to have money you need to acquire it, and to acquire it you need to make a product to sell, and to create the product you need the people who you need to pay. It’s a vicious cycle that never ends, unless you change your perspective.
It is true that most people want to work in order to pay for their life expenses. It’s what people do, right? Well yes, and no. Monetary compensation is one form of compensation, the most sincere, and honest of them all. But sometimes, just some people want to work with a different kind of compensation. Some people might be willing to work for your company, for a part in it (10% ownership for instance), or maybe they want to work, as a project just to collect knowledge and experiences. While I DO NOT CONDONE of having people work for free in your company, you should bear in mind, that for some people, all it takes for them to work with you, is to believe in your company’s dream and vision.
Think it out! Can you offer something that you can provide for free that they would have to pay for, and they are in need for it? That could be a product (personal websites), a service (career coaching) or even beer. Never underestimate the power of beer when doing business!