6 ms·

I'll share our story and current situation: We bootstrapped with time (evenings & weekends) until we had enough revenue to keep the lights on, at which point w

• cloudjacker 10y ago
  > very particular about people pulling their weight, so we've churned through 10 people so far. I've had a very difficult time competing for top talent. "we're going to invite you for a fifth round of interviews to make sure you're someone in line with our vision and understands our mission"
  • dreyfan 10y ago
    not at all, if anything it's been the opposite (lack of vetting): we find someone that looks good on paper and interviews well, so we roll the dice and hire them. Then end up having to let them go in a few months when they can't hack it.
    • cloudjacker 10y ago
      what do you think about example projects, if they finish it then you've done some of the screening already the criticism of this being that some people call this free work
      • dreyfan 10y ago
        We've actually attempted that a couple of times (always with pay) but have always been turned down -- People either don't have the time for an eventual maybe or already have other offers on the table. I think in a job market that had a more balanced supply/demand that would work great.
    • rifung 10y ago
      What do you think is stopping them from being able to "hack it"? It seems like if they've been there a few months already, you've essentially given them a few months training. Wouldn't it make sense to just continue that training until they're able to do what you want? Or, is there something else that is stopping them?
      • dreyfan 10y ago
        It's very possible they could have turned into something great and we were cutting losses too soon. That said, I have fairly high expectations and expect people to be motivated, tenacious and smart. We have such a broad spectrum of what we do (in a nutshell: infosec and data mining), it's difficult to simply train people for the myriad of scenarios they might encounter. This year I'll be stepping up my recruiting from the infosec community directly, up to now I've focused on polyglot devs with a background in security & web.
        • toadi 10y ago
          Aren't most people who are motivated, tenacious and smart trying to start something on their own?
          • dreyfan 10y ago
            Yep. Exactly the issue. I want people with similar traits as myself and all I find are people who just want a job with a steady paycheck.
            • rifung 10y ago
              > all I find are people who just want a job with a steady paycheck In fairness, I think besides those who are well enough off to not need to work, a paycheck is the main reason people work. I'm just a junior engineer who admittedly doesn't know anything so take this with a grain of salt, but firing people because they are not similar to you seems bad for the company. After all, if they do good work in a timely manner, shouldn't that be more than sufficient? If you only hire people who are like you, then it seems like you'd get a serious lack of diversity too, even though the benefits of diversity are well studied. Then again, you're the one running a successful business while I'm just a random guy browsing HN when I should be working!
    • tiatia 10y ago
      "so we roll the dice and hire them. Then end up having to let them go in a few months when they can't hack it." Something is wrong here. 1. You are able to hire somebody. Your salaries may be to low that you may have a bias here. But people do start. 2. After a FEW MONTHS you realize that they are not able to "hack it" Sounds much more like a management problem than a skill problem.
• adventured 10y ago
  What part of the country are you in? I ask in relation to the competition for talent and salaries.
  • dreyfan 10y ago
    Completely remote though we've opted for US-citizens to keep the taxes simple.
    • manmal 10y ago
      Seems like an arbitrary boundary to me. IF you can live with timezone differences, why not employ eg Europeans as freelancers? Taxes should be very plain then, perhaps you need some reverse VAT declaration but that's it. Wages are lower here, too, so sthg like €80k would actually be pretty good pay. Disclaimer: EU freelancer here.
    • DavidWanjiru 10y ago
      Exactly how much more complex would the taxes be if you had non US people? Considering you're struggling with hiring, the complexity would have to be quite a bit to warrant missing out on non US talent, especially bearing in mind you could hire a pro to do your taxes when tax season comes around.
    • cylinder 10y ago
      What kind of talent are you looking for? Technical, sales, marketing, administrative, etc?
      • dreyfan 10y ago
        Tech
• rebootthesystem 10y ago
  > I've had a very difficult time competing for top talent. The problem is this idea of looking for top talent. The vast majority of people in virtually any human endevor are mediocre. Be it an orchestra, army or corporation. Maybe 5% to 10% of an organization is top talent, the rest are average. What makes any organization excel is having managers and leadership who can take a team of average folks and make them produce brilliant sounding symphonies. Develop THAT skill and you'll have no limits.
  • kordless 10y ago
    I would say that hiring and training process becomes paramount in a bootstrapped organization. I'm going through it right now in my current gig.
  • manmal 10y ago
    The picture of Google recycling old, cheap servers to generate vast amounts of combined computing power comes to mind. It's all in the management layer.
  • alexqgb 10y ago
    I wish I could upvote this 100 times because this is the absolute honest to goodness truth. It's not that talent is over-rated so much as really well-run places are underrated. Perhaps that's because talent is actually a lot more common, and thus better understood.
  • Taylor_OD 10y ago
    This. I work in a organization (sales) where the top 5%-10% generates as much revenue as the other 90%-95%. However the mediocre or just okay people are a crucial part of the system. The best teams in my company are a run by great managers that know how to get the most out of a average employee.
• 23david 10y ago
  My current company has a comparable bootstrapped history and seems to be in a similar phase, but hiring hasn't been an issue. If I'm hearing you correctly, it sounds like you have 3 people, ~$1.8 MM net profit and since your tax burden is low it looks like you pay out most of that by the end of the year. So are you looking at annual compensation of $500-600K each? Why not stop paying yourselves so much and reinvest more in your business? IMO, it's a lot easier to hire and take risks on money if it's set aside in a pool of money that you've designated as NOT being for founder salaries. If you cut back to a more reasonable $150-250K salary each, you'd have tremendous free cash flow available for all sorts of hiring and even acquisition possibilities.
  • dreyfan 10y ago
    We don't actually pay ourselves anything absurd in salary and we have a lot of retained earnings sitting in the bank. We did try hiring and investing the finances last year (physical office, 6 people) but the inability to find the right people combined with my terrible managerial skills resulted in a pretty ineffective situation.
  • hinkley 10y ago
    Eventually someone is going to figure out how much money they're making in their market. Maybe someone they bragged to at a mixer, or maybe an employee of one of their customers. It's very hard to stay competitive when you have nobody to compete with, and expanding your product into new markets can, perversely, give you competition because you paint a target on your head (hey, we do X, and they're taking our X lunch, we should start doing Y and see how they like it). Maybe a little bit of growth would be good for them. Me, I like about a 25-30% growth rate a year. As a lead dev I've always struggled to keep up with the changing team dynamics when it's bigger than that, and most of my peers have had similar experiences, differing only by degree. I don't think I've ever seen someone manage more than a 2x growth rate without the wheels coming off, and yet I've seen many try 5-10x and flame out in the process. So for them to ramp up without growing pains, they could easily add one person this year, another in about 8 months, and another 6 months after that. As the team gets bigger you can hire people more often, because you're used to it and your protocols for absorbing new people get better and better. Just remember to assign some of those people to trying to do more with what you already have, and identifying frugal expenditures that have multiplier effects (I've had to beg for $5000 in hardware and gotten another FTE instead so many times it's become a cliche). The working smarter aspect will keep your team lean and build a lot of confidence they'll need when a competitor or a fractious customer finally shows up.
• djrobstep 10y ago
  "If you have a problem with one or two people, maybe it's them. If you have a problem with everyone, maybe it's you."
  • dreyfan 10y ago
    I'm in complete agreement. I know the business, I know the tech, and I know I'm absolute shit on hiring/managing. My cofounder isn't any better either. Hiring someone to manage would probably be the most useful next step.
• pjc50 10y ago
  When a new employee's salary directly comes out of your own compensation Are you a limited company or a partnership? If you're an LLC, it's not your own pocket, it's the company's. This feels pedantic but is very important both legally and psychologically. Remember it works the other way round for your employees. Their extra work goes into your pocket, not theirs (unless they're on commission!) If you had 1,000 employees, would you see every last one as taking from your pocket? Come to think of it, maybe this is why so many business owners nickel-and-dime employees into misery. you tend to become very particular about people pulling their weight You're a founder. They're not. They are never, ever going to be as committed as you. They're going to do the 9-to-5 and then go home and think of other things. This is fine, because their compensation has a bounded upside and yours doesn't. Unless you're giving them a huge equity stake, which doesn't sound like the case. You have to reconcile yourself to this. Trying to make the whole company out of founder-level committed people is like the old joke about "you know the indestructable aircraft black boxes - why don't they make the whole plane out of that stuff?"
  • mancerayder 10y ago
    "You're a founder. They're not. They are never, ever going to be as committed as you. They're going to do the 9-to-5 and then go home and think of other things. This is fine, because their compensation has a bounded upside and yours doesn't. Unless you're giving them a huge equity stake, which doesn't sound like the case. You have to reconcile yourself to this. Trying to make the whole company out of founder-level committed people is like the old joke about "you know the indestructable aircraft black boxes - why don't they make the whole plane out of that stuff?"" I could not have said this better myself. I worked - as an IT manager - in a relatively successful startup recently and experienced that same realization. The founders were very young, in their early 30's, and had a daily, constant serious, ornery, mistrustful attitude towards staff. The founders worked 6, 6.5 days a week, 10 hour days. However, some of the most junior staff also worked like that. They were mistrustful with regards to the amount of time people put in, and these founders paid almost everyone under market even though they themselves were standing to make millions off of the expected sale of the company. While the founders believed everyone in the company was swindling them by cheating their work time, as a manager I knew that people worked very hard, with enormous stress. As you can sense from the original poster of this sub thread, the two positions (founder v. salaried employee with a little bit of stock options) are irreconcilable EXCEPT if the founders start to realize the added value of the employees versus their cost. "An employee's cost" == short-term thinking. In my opinion, if you're churning through 10 people and you're only still 3, I'd wager (without knowing more facts it's just a wager) that the comment about not finding 'top talent' is a rationalization for something else that's wrong managerially in that startup. Mentorship, training, higher pay, patience, better interviewing are all possible avenues to pursue to AVOID the 'churning through 10 people' scenario.