One of the big questions that startups face as they begin to scale is whether they should promote their own employees up to new roles or hire laterally. How should they hire these leaders? What traits should they look for? How should they manage the inevitable tensions between the newcomers and the home-grown rock stars? How does this impact the culture of the company?
Hiring and assimilating laterals is a key success factor for a startup to scale smoothly. Typically, a startup begins to refresh talent after the product-market fit has been established and the founders see an opportunity to scale. By the time they reach this point in their journey, founders would have often recognized the inadequacies in the leadership team that could be an obstacle to further growth. While the early team is great at hustling and getting things done, its members often lack the ability to put in place systems to keep the ship stable as the organization scales. I will touch upon two separate but interrelated aspects of hiring and assimilating laterals.
To start with, there is a tendency to be impressed by those who have the experience of scale and managing large teams. But there is a world of difference between those who have managed in a scale environment and those that can build for scale. It is important to differentiate the two and hire those who can build for scale. They have two traits that the former don’t have: a) ability to roll up their sleeves and get things done even without support structures, and b) ability to solve problems ground up.
I can think of two cases where I was involved in making the wrong call. In one case, we were hiring a global head of sales and in the other, a chief operating officer (COO). In both cases, we ended up hiring individuals who were managing scale but had lost the ability to be hands on. In both cases, there were red flags all along—in the demands they made, the questions they asked, the way they steered the discussion to avoid deeper probing—but none of the individuals who interviewed the candidates raised their fears for the simple reason that there was tremendous pressure from the board to close the positions quickly. This created a false consensus of sorts because the candidates seemed so right in every other way and we made the wrong decision. Both individuals had to be let go eventually and this set back the growth journey by more than six months in each case.
One of the
big
questions that startups face as they
begin
to
scale
is whether they should promote their
own
employees up to new roles or hire
laterally
. How should they hire these leaders? What traits should they look for? How should they manage the inevitable tensions between the newcomers and the home-grown rock stars? How does this impact the culture of the
company
?
Hiring and assimilating laterals is a key success factor for a startup to
scale
smoothly
.
Typically
, a startup
begins
to refresh talent after the product-market fit has
been established
and the founders
see
an opportunity to
scale
. By the time they reach this point in their journey, founders would have
often
recognized the inadequacies in the leadership team that could be an obstacle to
further
growth. While the early team is great at hustling and getting things done, its members
often
lack the
ability
to put in place systems to
keep
the ship stable as the organization
scales
. I will touch upon two separate
but
interrelated aspects of hiring and assimilating laterals.
To
start
with, there is a tendency to
be impressed
by those
who
have the experience of
scale
and managing large teams.
But
there is a world of difference between those
who
have managed in a
scale
environment and those that can build for
scale
. It is
important
to differentiate the two and hire those
who
can build for
scale
. They have two traits that the former don’t have: a
)
ability
to roll up their sleeves and
get
things done even without support structures, and b
)
ability
to solve problems ground up.
I can
think
of two cases where I
was involved
in making the
wrong
call. In one case, we were hiring a global head of sales and in the other, a chief operating officer (COO). In both cases, we ended up hiring individuals
who
were managing
scale
but
had lost the
ability
to be hands on.
In
both cases, there
were red
flags all along—in the demands they made, the questions they asked, the way they steered the discussion to avoid deeper probing—
but
none of the individuals
who
interviewed the candidates raised their fears for the simple reason that there was tremendous pressure from the board to close the positions
quickly
. This created a false consensus of sorts
because
the candidates seemed
so
right in every other
way and
we made the
wrong
decision. Both individuals had to be
let
go
eventually
and this set back the growth journey by more than six months in each case.