For Early Stage Startups, You Need Employees To Choose The Company. Not The Other Way Around.

I love helping startups hire, especially early on. Look, companies don’t exist without founders — often when we write our initial investment checks there aren’t any employees — but nothing amazing happens without a team. I’d go even further and suggest that if I could access just a single predictive signal after we’ve made an investment of whether the company has a chance to be successful it would be something to the effect of, “show me the first 20 people on the team.” Not the product, not the buzz, not the sales numbers. The people. Because en masse, smart ambitious talented thoughtful human beings are the best prediction model, especially when they vote with their feet.

Ultimately building a hiring brand and motion is the job of the founders, but investors can help a lot. When we spun up Homebrew, our first operating hire was a Head of Talent (Beth Scheer) because we knew that it made sense to bring an expert on board. And then personally, Satya and I also get involved in supporting founders as they start ramping up the growth efforts. Personally, one of my favorite activities is speaking with a candidate during the latter half of the process, when they already have an offer or are getting close to receiving one. I tell the companies I back that it’s an inexhaustible resource — don’t save it just for executive hires. If there’s anyone you think needs or wants to hear from an investor before committing to the company, you intro us and I’ll get it scheduled ASAP. One caveat though, I won’t tell potential employees just what they want to hear. And if I think it’s a bad hire, I’ll tell the founders and ask them to engage with me on those concerns to make sure it’s been thought through, or referenced, or something to keep an eye on once they join. It’s ultimately the founders’ decision on who to hire, but you don’t take my money for me to just be cheerleader. You take my money because you think we can be additive from outside the org chart.

Yeah, so these “sell” calls/coffees/meetings. I actually don’t think my job is to sell, at least not to sell them something they don’t want. Especially early on it does neither party any good to bait and switch a new hire. You gotta understand why and how they’re making their decision and then engage honestly to supply your POV and answer their questions.

I begin every candidate discussion with two commitments:

First, I tell them that while obviously I’m incredibly enthusiastic about this startup, that I believe people choose companies, not the other way around. And so I consider this opportunity my chance to give them more data and perspective they need to make that decision. But that I won’t tell them just what I think they want to hear, because then I’d lose their trust and they wouldn’t stay long at the company anyhow.

Second, I emphasize that although I’m going to loop back with the founders to let them know we spoke, and provide my general impressions of the conversation, that I’m happy to keep anything confidential. That is, don’t worry about how you phrase a specific question or a topic that might be sensitive. Because anything unspoken is usually an impediment to a good decision.

From there I give a bit of my background with the company to level-set. Then we open up to specific questions the candidate might have. I try to close by understanding where the individual actually is in their decision, and what they still feel like they need to do. And I repeat back to them why I think the company could be a good fit for them (based on our conversation), if I truly believe it’s the case.

Does this all take time and energy? Of course. But I do believe when done correctly, it’s one of the pivotal roles an early stage investor can play for the founders they’ve backed.