4 ms·

And this is all bad, bad, bad news for recruiting. These companies will all be fighting over the same talent pool that is growing only slowly.

privacybuff 13y ago
Are you assuming these startups are all in the bay area? I don't think PG is. I think he's saying that doing startups is becoming a broad cultural phenomenon. I think the "talent pool" really should be the whole world. There are several startups I know of who hire people completely remotely. One guy lives in thailand, the other in spain, etc.
beambot 13y ago
Actually, it sounds like a golden startup opportunity: disrupting the recruiting industry. Besides, strong job creation dynamics sounds like a generally-good problem.
mhartl 13y ago
On the other hand, it's good news for people who sell programming tutorials.
spamizbad 13y ago
I'm genuinely surprised by the wherewithal entrepreneurs have at hiring domestic talent. Anyone know why outsourcing isn't more popular- particularly among B2B startups? I'm a developer myself, but if I was an entrepreneur with no coding skills, I'd hire some guys in India to crank out my lo-fi MVP and use that to find a product/market fit and then raise money. I suppose it's not that easy though, is it?
- RyJones 13y ago
  I have seen outsourcing done many times. I have never seen even a partial success.
  - spamizbad 13y ago
    What usually goes wrong?
    - njr123 13y ago
      The quality of the outsourced programmers is extremely low. They might cost 20% of a domestic programmer, but if you got even 20% of the productivity you'd be pretty lucky. These outsourcing companies will also only do exactly what you have specified. This means the specs have to be very precise, in a way that I think would be difficult to do if you weren't a programmer already
      - abalashov 13y ago
        Indeed. Plus general communication problems, language problems, time zone problems, and lack-of-shared-intellectual-culture problems. It's a lot to overcome to save a few pennies.
- saumil07 13y ago
  I have yet to see it work successfully in a startup context - I am sure it can be done and there is certainly empirical evidence out there - but I have yet to see it work. The feedback loop is frequently difficult to get right. Communication barriers don't help (fwiw I grew up in India so have some sort of limited advantage but not by much). The time zone difference does actually slow things down a tad bit more. You talk about 2 rather different milestones in your comment - building a lo-fi MVP is certainly possible with an offshore team. But lo-fi MVP != product/market fit on any reasonable definition of p/m fit (Sean Ellis' formulation of 40% of users/customers) being disappointed with your disappearance, say). Getting to p/m fit may require lots of rapid experimentation, iteration, brainstorming and so forth...and that's when you can run into trouble with offshore contractors.
- flyinRyan 13y ago
  Well, most startups appear to pay crap rates with dubious company ownership schemes. What more value could they get out of outsourcing when they're likely already paying far below minimum wage?
x0x0 13y ago
this is one of my hobbyhorses, but recruiting really isn't that hard. If you're finding it hard, let me ask: (1) are you paying market salaries? (1a) are you really paying market salaries, or are employees supposed to join your company because you're a special snowflake (1b) even if you are paying market, why should an employee go to your firm? What is the upside to them for leaving a boss and company that they know? Because it would be really convenient for you, the hirer, is not a good answer. (2) do you make the interviewing process decent, or do you scatter caltrops in front of potential employees (2a) good employees do not need to crash study then regurgitate graph algorithms that your company never uses on the whiteboard. They also have jobs and value their vacation time and don't care to spend a week consulting for you (2b) how long does it take you to respond to resumes that come in? You should be able to say yes/no/maybe within 2 business days. Do your recruiters / interviewers actually read the cover letters / resumes? Last time I changed job a big sf / yc startup let my first interviewer roll into the interview room just shy of 20 minutes late without having read my resume. That's a complete fucking dick move, and it's part of why I turned them down. (2c) when potential employees send you github links, do you have an engineer actually bloody look at them (almost never in my experience) (2d) do you actually expend effort to meet potential employees / grow a bunch of warm leads, or do you wait until 3 weeks before you want someone to start then gripe because you can't convert cold leads in 1 week plus a 2 week resignation period for their current employee? (2e) do you use shit software like that jobvite bullshit that badly ocrs then expects me to hand proof their shitty ocr job? Or do you directly accept pdf resumes. (2f) for the love of god, I do not have a copy of ms word and wouldn't take one if it were free. I will not put my resume into word format. (3) do you take some pains to grow employees? Hire people out of university? Take a chance on people? (3b) Like one of my former employers, do you do a good job hiring new grads from schools besides stanford / berkeley / mit / cmu, but then 18 months in after employees have demonstrated their value refuse to bring them up to market rates and lose them? (4) when you send out offers, do you actually put out a good offer or do you throw numbers out that are 10% or more under your ceiling then expect employees to negotiate hard with you? I just turned down an sf startup because they did this; the ceo who hired me said, "x0x0: when I was an employee I hated negotiating, so I'm going to make you a great offer. This also means I'm not going to negotiate." And you know what? It was a great offer, and I said yes the next morning. It also avoids starting your new job after a confrontational exercise. (5) if you have recruiters contacting people, do you have them make clear they're internal not external? (5b) do your recruiters actually read peoples' linkedin profiles before contacting them? I used rails a bit 3 employers ago and had to remove that word from my profile because I got spammed with rails stuff. (6) do your job postings on LI/craigslist/message boards tell potential employees why he or she should work for you, or is it simply a long list of desiderata like the vast majority? (7) like Rand says, do you know off the top of your head the career goals of your employees? What are you doing to help them get there? (7b) just like the easiest sale is an upsell to a customer you have, the easiest recruit is the good employee you already have that you keep happy and prevent from leaving (7c) do you give your employees raises to keep them at or above market, or can they get a $20k raise by swapping companies? If that raise is on offer, exactly why should they continue to work for you? (7d) on that note... 0.2% of an A round company isn't golden handcuffs. It's more like paper handcuffs.
argonaut 13y ago
I'd like to offer an observation: based on both anecdotal (and actual classroom data), college student interest/enrollment/majors in CS have gone up something like 2-3x in the past 2-3 years alone, and is only going to increase even further year-over-year. As with many other things, labor definitely has a significant lag period, and for all we know there could be a glut of software developers in 4 years.
flyinRyan 13y ago
Good. Software development is horribly underpaid in most places (even the places most on here would say are well paid, IMO) so it's only right that companies should be competing against a person's opportunity to make their own company.

privacybuff 13y ago

Are you assuming these startups are all in the bay area? I don't think PG is. I think he's saying that doing startups is becoming a broad cultural phenomenon. I think the "talent pool" really should be the whole world. There are several startups I know of who hire people completely remotely. One guy lives in thailand, the other in spain, etc.

beambot 13y ago

Actually, it sounds like a golden startup opportunity: disrupting the recruiting industry. Besides, strong job creation dynamics sounds like a generally-good problem.

mhartl 13y ago

On the other hand, it's good news for people who sell programming tutorials.

spamizbad 13y ago

I'm genuinely surprised by the wherewithal entrepreneurs have at hiring domestic talent. Anyone know why outsourcing isn't more popular- particularly among B2B startups? I'm a developer myself, but if I was an entrepreneur with no coding skills, I'd hire some guys in India to crank out my lo-fi MVP and use that to find a product/market fit and then raise money. I suppose it's not that easy though, is it?

RyJones 13y ago
I have seen outsourcing done many times. I have never seen even a partial success.
- spamizbad 13y ago
  What usually goes wrong?
  - njr123 13y ago
    The quality of the outsourced programmers is extremely low. They might cost 20% of a domestic programmer, but if you got even 20% of the productivity you'd be pretty lucky. These outsourcing companies will also only do exactly what you have specified. This means the specs have to be very precise, in a way that I think would be difficult to do if you weren't a programmer already
    - abalashov 13y ago
      Indeed. Plus general communication problems, language problems, time zone problems, and lack-of-shared-intellectual-culture problems. It's a lot to overcome to save a few pennies.
saumil07 13y ago
I have yet to see it work successfully in a startup context - I am sure it can be done and there is certainly empirical evidence out there - but I have yet to see it work. The feedback loop is frequently difficult to get right. Communication barriers don't help (fwiw I grew up in India so have some sort of limited advantage but not by much). The time zone difference does actually slow things down a tad bit more. You talk about 2 rather different milestones in your comment - building a lo-fi MVP is certainly possible with an offshore team. But lo-fi MVP != product/market fit on any reasonable definition of p/m fit (Sean Ellis' formulation of 40% of users/customers) being disappointed with your disappearance, say). Getting to p/m fit may require lots of rapid experimentation, iteration, brainstorming and so forth...and that's when you can run into trouble with offshore contractors.
flyinRyan 13y ago
Well, most startups appear to pay crap rates with dubious company ownership schemes. What more value could they get out of outsourcing when they're likely already paying far below minimum wage?

x0x0 13y ago

this is one of my hobbyhorses, but recruiting really isn't that hard. If you're finding it hard, let me ask: (1) are you paying market salaries? (1a) are you really paying market salaries, or are employees supposed to join your company because you're a special snowflake (1b) even if you are paying market, why should an employee go to your firm? What is the upside to them for leaving a boss and company that they know? Because it would be really convenient for you, the hirer, is not a good answer. (2) do you make the interviewing process decent, or do you scatter caltrops in front of potential employees (2a) good employees do not need to crash study then regurgitate graph algorithms that your company never uses on the whiteboard. They also have jobs and value their vacation time and don't care to spend a week consulting for you (2b) how long does it take you to respond to resumes that come in? You should be able to say yes/no/maybe within 2 business days. Do your recruiters / interviewers actually read the cover letters / resumes? Last time I changed job a big sf / yc startup let my first interviewer roll into the interview room just shy of 20 minutes late without having read my resume. That's a complete fucking dick move, and it's part of why I turned them down. (2c) when potential employees send you github links, do you have an engineer actually bloody look at them (almost never in my experience) (2d) do you actually expend effort to meet potential employees / grow a bunch of warm leads, or do you wait until 3 weeks before you want someone to start then gripe because you can't convert cold leads in 1 week plus a 2 week resignation period for their current employee? (2e) do you use shit software like that jobvite bullshit that badly ocrs then expects me to hand proof their shitty ocr job? Or do you directly accept pdf resumes. (2f) for the love of god, I do not have a copy of ms word and wouldn't take one if it were free. I will not put my resume into word format. (3) do you take some pains to grow employees? Hire people out of university? Take a chance on people? (3b) Like one of my former employers, do you do a good job hiring new grads from schools besides stanford / berkeley / mit / cmu, but then 18 months in after employees have demonstrated their value refuse to bring them up to market rates and lose them? (4) when you send out offers, do you actually put out a good offer or do you throw numbers out that are 10% or more under your ceiling then expect employees to negotiate hard with you? I just turned down an sf startup because they did this; the ceo who hired me said, "x0x0: when I was an employee I hated negotiating, so I'm going to make you a great offer. This also means I'm not going to negotiate." And you know what? It was a great offer, and I said yes the next morning. It also avoids starting your new job after a confrontational exercise. (5) if you have recruiters contacting people, do you have them make clear they're internal not external? (5b) do your recruiters actually read peoples' linkedin profiles before contacting them? I used rails a bit 3 employers ago and had to remove that word from my profile because I got spammed with rails stuff. (6) do your job postings on LI/craigslist/message boards tell potential employees why he or she should work for you, or is it simply a long list of desiderata like the vast majority? (7) like Rand says, do you know off the top of your head the career goals of your employees? What are you doing to help them get there? (7b) just like the easiest sale is an upsell to a customer you have, the easiest recruit is the good employee you already have that you keep happy and prevent from leaving (7c) do you give your employees raises to keep them at or above market, or can they get a $20k raise by swapping companies? If that raise is on offer, exactly why should they continue to work for you? (7d) on that note... 0.2% of an A round company isn't golden handcuffs. It's more like paper handcuffs.

argonaut 13y ago

I'd like to offer an observation: based on both anecdotal (and actual classroom data), college student interest/enrollment/majors in CS have gone up something like 2-3x in the past 2-3 years alone, and is only going to increase even further year-over-year. As with many other things, labor definitely has a significant lag period, and for all we know there could be a glut of software developers in 4 years.

flyinRyan 13y ago

Good. Software development is horribly underpaid in most places (even the places most on here would say are well paid, IMO) so it's only right that companies should be competing against a person's opportunity to make their own company.