4 ms·

There's a very big time cost to hiring just the best. If you're afraid of even one bad hire, then a growing company must be willing to have all their managers

There's a very big time cost to hiring just the best. If you're afraid of even one bad hire, then a growing company must be willing to have all their managers and top employees commit 20+% of their time to hiring. Then you ask "Is the 1-2 standard deviation in performance improvement worth it?" If the answer is yes, then it's worth it. And... Interviews are awful. Seeing how someone work is even better. This is one reason why employee referrals are so important, and audition or temp-projects a good second-best method. In the end I think it's a Fools Game though - someone who is best in one environment may not be that great for the next. Managing people post-hire is something that can't be avoided.

notacoward 11y ago
It's not just a time cost. The graph near the top of Jeff's article shows "Ran Out of Cash" as the #2 cause of startup failures, ahead of anything else hiring-related. I say anything else because hiring the best means paying for the best. If you hire nobody else, then salary costs rise. Attrition probably does too, because the best are often among the first to jump elsewhere. Every startup needs a few of the best. You should definitely seek out and pay for those few. After that, even a startup has jobs that don't require the best. Hire for potential, attitude, chemistry. Hire for special knowledge when you have to (though you should try to avoid it). But don't demand that every hire be among the proven elite.
- mathattack 11y ago
  You could argue that the best pay for themselves, and that running out of a cash could come from hiring bad people. The absolutely best employees I've seen haven't been frequent job hoppers. At most it's every 3-5 years. I'm thinking of an unscientific sample size of 5 or 6 people who have had sustained outstanding technical performance of 10-25 years. Companies don't let people like them go. And they tend to be loyal to the mission if treated fairly. Now a company with $1mm of seed money that's supposed to last 12-18 months can't afford to hire 5 people like that. There's not enough cash or equity to go around.

notacoward 11y ago

It's not just a time cost. The graph near the top of Jeff's article shows "Ran Out of Cash" as the #2 cause of startup failures, ahead of anything else hiring-related. I say anything else because hiring the best means paying for the best. If you hire nobody else, then salary costs rise. Attrition probably does too, because the best are often among the first to jump elsewhere. Every startup needs a few of the best. You should definitely seek out and pay for those few. After that, even a startup has jobs that don't require the best. Hire for potential, attitude, chemistry. Hire for special knowledge when you have to (though you should try to avoid it). But don't demand that every hire be among the proven elite.

mathattack 11y ago
You could argue that the best pay for themselves, and that running out of a cash could come from hiring bad people. The absolutely best employees I've seen haven't been frequent job hoppers. At most it's every 3-5 years. I'm thinking of an unscientific sample size of 5 or 6 people who have had sustained outstanding technical performance of 10-25 years. Companies don't let people like them go. And they tend to be loyal to the mission if treated fairly. Now a company with $1mm of seed money that's supposed to last 12-18 months can't afford to hire 5 people like that. There's not enough cash or equity to go around.