The Hiring Mistake All Startups Make

Have you felt like this before? 

You have a mini-episode once a month about where your next wave of sales will be coming from. You have so many other to-dos to attend to, and you feel like you're running into this cash flow problem every month because you're not investing enough time to focus on your sales. So you decide to hire a Coordinator, or other entry-level hire to help you with your workload. 


The Reality


You absolutely cannot attend to all the needs of your startup. It's impossible and it's inefficient. The most obvious solution that the majority of entrepreneurs resort to is exporting their work to other people. You may hire someone into an Associate, Coordinator, or Assistant role to help you with the additional work. 


The Mistake


For the majority of startups craving growth, making an entry level hire can be a misaligned solution to the problem at hand. 

Although hiring entry level team members can be a large workload relief, if the problem that needs to be tackled is cash flow, you may be assigning the wrong solution to your problem. Solving executive-level problems requires executive-level solutions. To solve cash flow issues, you actually may need to hire a CFO, or a business consultant who can remedy the problem at hand. An entry level hire will only provide support, but cannot provide transformational solutions for your business. 

What's the culprit for this common mistake? Maybe entrepreneurs are simply mimicking the corporate hiring style of their past workplaces, where once a company grows, the company typically hires more sales people or entry-level employees to help with the workload. However, this hiring style is not a fit for a startup -- hiring an entry-level team member is only appropriate if a startup has already reached explosive sales, and now needs someone to maintain it.  For a startup, you need to hire backwards. 


Let's say that your organization is 3 years old, and you want your sales to increase by 60% next year. Your desired increase in sales needs to match the investment you make in it. Will an entry-level hire bring you an explosion in sales? No, they won't. Why? Because you need the guided expertise from someone who has accomplished those sales boosts before. If generating an increase in sales were as easy as hiring a Coordinator to send hundreds of cold pitches and help with workload distribution, a lot of us would be far more cash flow positive than we are now. 


The Solution
 

Think about where you want you want your startup to be 3-5 years from now and hire the person that'll make that happen. Sure, it's a bigger investment, but the beauty of this investment is that there are plenty of business consultants and growth specialists nowadays who only need to work with you for 3 months in order to help you structure your future. Once you have your growth equation in place, you can hire an entry-level employee to execute, and reap the transformational benefits from smart and strategic hiring. 

 


Sophia Sunwoo