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6 Hiring Best Practices for Startups Scaling Their Business

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The pandemic was a nightmare for workers and businesses alike. During the first year, 200,000 more businesses closed than normal by historical levels in the United States, leading to 22 million job losses in wealthy countries for a total of 114 million worldwide. These numbers should not be taken lightly; the impact unemployment can have on the economy and the lives and families of those affected is profound and incomprehensible.

But there is hope here too, and it is taking the form of a thriving ecosystem of new businesses and startups. The US Chamber of Commerce conducted an investigation During the pandemic, we examined startup trends and found that in 2020—in the depths of the pandemic—more than 4.3 million new business applications were filed, and approximately 380 of every 100,000 U.S. adults became new entrepreneurs each month. Likewise, these numbers carry considerable weight.

However, many of these companies are about to enter the scale-up phase, which is easily one of the most precarious. Many risks populate the path from startups to household names. First, a business leader may have to accept that the company’s management structure may no longer work if new staff is introduced.

Employers may also need to adjust how they handle hours, benefits, breaks, etc., and dive deep into employment law. Sometimes, paradoxically, the growth of a company requires layoffs as the skills necessary for success in an industry shift. Perhaps the biggest risks are alienating old customers as a business grows and grows too fast — never realizing it’s too early to hire more staff.

For new companies advancing in their field, the intuitive next step could be to dive into the robust pool of talent seeking new work in the wake of the pandemic. But startups need to be mindful when taking this next step. Following is a list of best practices for companies looking to hire people to scale.

 

Infographic created by Clover, a POS system company

6 best practices for hiring startups

1. Start strong

For starters, startups looking to scale their recruiting strategy need a plan, and timing everything right is essential. This is especially true for companies that are scaling quickly.

According to volume recruitment solutions company Harver, it’s important to take stock of the challenges that exist in the founder’s startup space, and the unique challenges that the startup itself faces. It’s also a good idea to consider the team’s long, medium, and short-term goals to get a handle on where the company wants to go and when.

It is also essential to ensure that scaling efforts are timely. Sometimes the market may imply that it’s time to strike when the iron is hot, but in reality it just gets a bit warmer and can cool down too quickly.

2. Assemble the right team

Companies that grow prematurely or in the wrong way run the risk of becoming unsustainable. A recruiting budget should be balanced across the necessary areas of investment, including staffing for different skills, proper compensation, and recruiting in the order in which staff should come on board. A team must function like a well-oiled machine, and employers have the opportunity to build that machine by taking stock of their existing talent and conducting a needs assessment for the road ahead.

The Chicago Booth Review proposes to conduct a competency audit in your startup. Work on identifying the skills your startup needs to survive and thrive, noting which of these skills your team possesses and which you don’t.

The Review also notes that discipline is a must-have in the scaling-up process, so, as you work to build your team, start implementing an organizational structure. A good structure should enable collaboration and accountability, which are essential for a growing company.

3. Attract the best talent

Attracting the best people for the job and the best fit with a company’s culture can make all the difference as a company scales. Job search platform Indeed has a wealth of information for employers looking to bring skilled, passionate people into your team. Advice includes:

  • Create a recruiting column. This ensures that potential hires fill all niches and aids in transparency.
  • Use candidate selection platforms. While these aren’t always the most thorough, they can help streamline the hiring process.
  • Offer a remote work option. Some employees see the ability to work from home as a blessing. This of course depends on the nature of the function.
  • Write thorough and well-drafted job descriptions. In addition to communicating the needs of a position and the necessary skills and qualifications, this also helps a startup look more professional.
  • Prioritize diversity. The most successful companies, both financially and culturally, put diversity first and seek help in ensuring a biased hiring strategy to attract and support candidates from diverse experiences and backgrounds.

4. Don’t be intimidated by experience

According to Myles Hunter, co-founder and CEO of TutorMe, there’s nothing wrong with not being the most knowledgeable person in the room. Founders and CEOs need to know the history of the startup and maintain the vision of where it’s going, but it’s not a bad thing for staff to know about specific moving parts within a company. In fact, it can lead to stronger teams overall.

5. Avoid Common Pitfalls

During the hiring and scaling process, there are some common pitfalls that startups can fall prey to. Sales expert John Livesay says it’s important to monitor your team for burnout at companies. Hiring more people should ideally make work easier for everyone. But scaling up too quickly can lead to unnecessary stress.

Furthermore, it takes time to onboard new employees, and successful onboard is critical to employee engagement and long-term satisfaction. It’s worth keeping an eye on everyone’s stress levels and offering in-house mentorship and training throughout the process.

6. Get ready to learn

Scaling up is not an easy process. There are many challenges for leaders building their teams and growing their startups. Sometimes employers will meet these challenges and emerge victorious. Other times they come out bruised and battered. But all great leaders understand the importance of learning from their mistakes, and large companies are making those changes as they continue to hire.

For founders, knowledge comes in many forms and doesn’t always have to be first hand. Learn from other companies facing similar challenges, or reach out to an expert mentor (who certainly made their own mistakes in their time).

Scaling is an exciting, dangerous time, but if founders keep their minds open and willing to take on new information and perspectives, they will find their dream team and make an impact on the industry.

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