The Real Dealwith hiring, firing, and building the best

team for your business

Hiring new team members is consistently named in the top three challenges for

entrepreneurs.

I’ve got bad news, it’s not going to change.

But maybe it doesn’t have to be so bad.

Today I’ll cover a few things that I’ve learned along the way to save your sanity, including:

How do you know it’s the right time to hire someone?

What does a good startup employee look like?

How do you decide on compensation?

What does interviewing look like?

You’ve hired the wrong person, or someone no longer fits the role / organization… Letting someone go.

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How do you know it’s the right time to hire someone?1

You are losing money by not making the hire.

How are you losing money? You’re not able to take advantages of opportunities that could drive revenue, like:

- Onboarding customers - Account management of existing

customers - Thought leadership opportunities - Doing stuff that anyone could do

You are losing money by not making the hire.

How are you losing money? You don’t know your own worth.

Let’s just say, for instance, your salary or compensation (salary plus options, equity, etc.) equals $100,000:

You work an 8 hour day

(lol)

5 daysper week

All 52 weeksof the year

X X

that’s 2080 hours worked

pay attention, it’s getting good

At $100,000 in compensation, you are worth approximately $48/hour.

Which means you would need to think it’s a good idea to pay someone $48/hour

to do the task.

While the list is different for every business we’re talking about day-to-day tasks that eat up your time -

the time spent doing things that ONLY YOU can do.(like developing the product and taking it to market)

What does a good startup employee look like?2

Things you may think are good but aren’t:

Super cheap labor

Things you may think are good but aren’t:

Your former coworker (as your new employee)

Things you may think are bad but aren’t:

People with a bit of an ego.

Things you may think are bad but aren’t:

Someone changing industries / roles

Some qualities I’ve found that result in awesome team members:

➡ People that are focused on outcomes.

➡ People that don’t just thrive in chaos, they manage it.

➡ People who can command authority but be humble enough to take out the trash.

➡ RESILIENCE.

➡ People who are data driven and curious.

➡ A sense of muther-effing-URGENCY.I get to say muther-effing… Yay startups!

How to decide on compensation.3

Remember that thing about super cheap labor? Here’s where it comes back.

I decide on employee compensation as a factor of the following items:

➡ Fair market value / salary averages

➡ Company stage (seed, series A, etc.; includes options/equity)

➡ The Revenue Generation Factor (RGF)

➡ Prior experience in market

Erin’s Salary Consideration Chart

I don’t care if you don’t like it… Make your own.

Interviewing.4

Interviewing sucks. We all know it.

Here are a few things I think are important in the interview process.

➡ Never hire someone after only one interview

➡ Eat with them before you hire them. Lunch ,dinner, whatever… You’d be surprised what you learn.

➡ Dismiss people who haven’t done their homework.

➡ Test their ability to handle the unknown.

➡ Discuss compensation up front. Don’t waste time with people who are completely out of your ballpark.

A redhead’s guide to interviews

Yes, having red hair DOES help.

What does that mean? It means as you get to know people and make hires, make a list of the traits and things that drive you nuts or denote someone that’s going to suck.

Here are a few of mine… and no, I’m not kidding.

➡ Asking for perks day one. (Had someone ask for all organic lunch service and a yoga staycation)

➡ Saying ex-presso and ex-specially.

➡ Eating in a gross way. (Horror stories.)

➡ Showing up late any time in the first two weeks.

➡ Blaming others and / or whining.

And most importantly: Know your REDFLAGS

Friendly fire.5

So you’ve hired a dud.

Or someone just doesn’t fit the company needs anymore.

What now?

Firing people can be one of the most stressful things you do.

Especially when you’ve been working in close proximity for months and likely formed a friendship.

A few things to consider…

You have to consider your business.

If someone isn’t working out but you keep them around - you are sacrificing: - your other employees - your revenue - the potential of the position

Don’t ever forget this. It will get tough and you’ll want to throw this out the window.

You don’t always have to fire them.

Make sure you’ve talked to them first. ➡ Is there a motivation problem? ➡ Have they been given tasks they weren’t

trained on properly? ➡ Is there something else going on? ➡ Could they fit another role?

It’s expensive and time-consuming to bring on new people, so think about this stuff first.

If you do end up having to fire them: If you’ve done the other stuff I mentioned and you do need to let someone go…

➡ Don’t over explain. (Everything you say can be used against you later - I’ve seen it happen.)

➡ Thank them for their time at the company. If possible, offer to write a recommendation for a future role.

➡ Don’t apologize. ➡ If warranted, offer some severance compensation. ➡ Be ready to have them leave as soon as you’re done.

Which means shutting down email, access to things, etc.