Building Your Dream Team
It is said that a start-up’s first ten hires are what defines the company’s future. Hire correctly, and you will have an invested team with aligned goals, who work collectively to advance the company. Hire incorrectly and your team will be disjointed and will inhibit the business from capitalizing on their product. In this article we look at what characteristics are desirable to founders of start-ups, and examine the hiring process as a small player in the market.
Tom Bizzell has kindly agreed to walk us through the hiring process of his start-up WakeShare. WakeShare is a software company which facilitates the practice of platooning. Platooning is used by trucking companies who travel in convoys, with the intent to be more fuel efficient and thus saving money. You can liken platooning to cycling, where riders ride behind others and use them as a windbreak, therefore reducing the effort they need to exert. WakeShare provides a service for platooning between competitors by acting as a third party, only outputting opportunities for platooning. The beauty in this is that competitive advantage is maintained, as companies do not have to reveal their routes to their competitors, and can instead use a third party which protects the sensitivity of this information. Now that we understand the business, let’s see what insights Tom can share about the hiring process of WakeShare.
Should you begin your company alone or with a team?
“Is it better to be a solo founder or to be in a founding team” is perhaps one of the oldest debates in Silicon Valley. Research from Wharton concludes a conflicted narrative. Wharton found that investors were biased towards cofounding teams, as these teams were typically more successful in the capital raising stage. However, start-ups with single founders tended to last longer, and would eventually achieve higher revenue. When a start-up has one founder they have ultimate control over the direction of the company, and are more agile in their decision making. However, having cofounders who complement each other may address a broader scope of issues the company faces. Our advice? Treat this question on a case-by-case basis.
As someone with a start-up, Tom is more qualified than us to give his opinion. Tom believes “if you have more people with equity in the business” the company benefits from additional hours invested, as well as diversity of thought. However, history has produced many successful stories of solo founders, so this route should not be discounted. Founding solo or founding team, Tom stressed the importance of not diluting ownership to those without passion in the project, as these people will weigh the company down when it is time for capital raising.
Who can add value to your start-up?
We’ve stressed the importance of a start-up’s initial hires, but what should they actually look for come recruitment time? For Tom and WakeShare, a real emphasis was placed on whether candidates had completed side projects of their own, as the company was looking for a software engineer. An appealing candidate can not only apply their studies to “skills in the real world,” but having side projects demonstrated that they would be willing to dedicate themselves to WakeShare simultaneously with University commitments.
Of course, an applicant needs to be generally employable to secure a job. Particularly in smaller teams it is important that the dynamic is cohesive, so working well with others is a key consideration. Another important trait is the “ability to work autonomously,” where founders can confidently ask you to complete tasks knowing you have the discipline to do so in a timely manner. Tom placed a significant weight on the ability to solve problems and answer questions for yourself. That is, when a person faces a roadblock, do they have the ability to trial different solutions independently or do they rely on a supervisor to tell them what to do? Particularly in the start-up space, the ability to work independently is perhaps one of the most important attributes a hire can have.
How do small companies stand out in such a competitive market?
As much as start-up’s rely on premier talent to succeed, there is an obvious difficulty in hiring when your business is so small relative to the competition. Many start-ups will offer equity to their initial employees to compensate for often little to no salary whilst the business is not profitable. This is a difficult line to toe, as founders will often try to retain as much as equity as possible, so will need to be selective as to what percentage of ownership they are willing to part with. It is common practice in start-ups to include a vesting period when initially hiring, which sets a time horizon an employee must work for before being entitled to an equity stake. This protects the founder from parting with their equity only to have that employee leave straight after.
WakeShare relies on the strength of their idea, as well as what opportunities can provide their employees to work on. Tom liked to refer to the “Litmus Test,” where he believes that if you can attract talent as a small company, it is likely a reflection to the strength of your idea. WakeShare is also uniquely position to acquire talent, as the founders are university students. Tom believes that his success at the Global Ericcson Innovation Awards provided an attraction to fellow students, who seek to work alongside fellow innovators. Moreover, university students are keen to progress their careers by being involved with extra-curricular work, and what is more interesting than working in the start-up space?
How can you become a valuable hire?
Expanding upon your University degree is our best recommendation to becoming an attractive hire. Whether this be participating in clubs, case competitions, or having projects of your own, participation generally shows you’re invested in your degree, and want practical real-life experience you may not get from the classroom. From a founder’s perspective, they want to see passion about what you do, and how that passion can be applied to their company. Extra-curricular work is important, and we recommend involvement as our best way to improve your employability.
We thank Tom for his time and wish him the best of luck. Keep an eye on WakeShare, as the company plans on hitting the market as the primary platooning coordinator for trucking networks.
If you found insight from this article and want to hear more, stay tuned for our next post where we discuss all things funding. What are the different ways of securing funding? How should you approach a valuation of your company?