Updated on: Mar 17th, 2023
11 min read
Hiring the first employees for a startup is a huge step. The right employees have to be chosen and selected, as it can either lead or break the startup’s growth. Hiring potential, capable and passionate employees will help any startup to develop and grow.
Hiring your first employees will change the bandwidth of the business. With new employees, the pace of the work of your business moves faster. However, while hiring your first employees, you have to be careful with your decision and do your best to hire the top talent. You need to consider the below-listed factors before hiring your first few employees.
Before you go for hiring your first few employees, you need to consider your finances. You can hire someone when you need them, and you can afford them. The first few employees add value to your company. It brings in brainpower, creativity, and extra support to get things done faster.
You will need to consider how much you can reasonably afford to pay salary, how much you can stretch your finances for an employee along with providing benefits to the hired employees. Regardless of what you can afford in compensation or benefits, many candidates value the professional growth and extra responsibilities offered at startups and small businesses.
You need to decide the roles for which you want to hire your first employees before going ahead with the hiring process. Depending on the finances, you also need to decide how many employees you want to hire for a particular role/job. You need to prioritise the positions that are most critical to the growth and success of your startup in its early stages.
Write job descriptions before posting for hiring. Include if the job is full time or part-time, the roles and responsibilities, salary offered and the challenges the candidate will face in the job descriptions, so both the candidates and you know about the exact hiring positions.
A hiring infrastructure must be put in place before starting to hire new employees. It will guide the company in hiring the employees systematically. A hiring infrastructure differs from company to company, but they typically include the following:
Once you decide on the hiring requirements, create the job description for the roles and establish the hiring infrastructure. The next step is to post your job descriptions on social media and recruiting websites to help you find the right candidates for your company.
You can ask for referrals of potential candidates from your colleagues, friends and your business network. You can even promote your company and look for suitable employees at business meets or recruitment events. You can even outsource your recruitment requirements to a recruiter who works with startups or a recruiting agency.
After you receive applications:
Ask your candidates to complete a task. It will give the candidates an idea of their nature of work and help you assess if they have the skills required for the job. Check the background of the candidates. It is important to run a background check of the selected candidates and verify the information in their applications.
Background checks help you confirm candidates’ prior employment, original educational credentials, and any criminal records. Contact the references given by the candidate. It will help you learn about the candidates work ethics and job performance, role and duties. The interview should help you determine if a candidate is a right person for that job or not.
You should consider candidates who have potential rather than just past success or experience. A candidate who has an interest or passion for the same cause as yours with the required skill will be an asset to your company.
The new employees should help you grow your business and ideally bring in additional revenue. If you need to test an employee’s skills, you can also put them to the test to see how they respond to pressure. It also helps the employee assess whether he/she wants to work for you or not, as working in a startup is different from working in an established company. The candidates need to be willing to work, knowing that it will take time to get huge rewards.
When you hire your first employees, look for candidates who want to be a part of your business and share your ideas. The candidates need to be team players with strong collaboration skills, intellectual curiosity and have the ability to tackle multiple tasks simultaneously. You can download the sample ‘Offer Letter’ and ‘Employment Contract’ below.
Once you decide on the candidate, the next step is to send him/her the job offer. When a candidate accepts the job offer, ensure to conduct a smooth onboarding process of the candidate into your company. An onboarding process should help your employee to get to know the culture and overview of your company.
You can have a series of sessions with the first employees introducing your company’s culture and values to them, introducing them to their roles, letting them know of opportunities for their growth in the company and assign them projects.
After you hire your first employees, build a positive company culture. You experience the ups and downs of your company with your first employees. Treat them as a member of your team as they will help you build your vision. A positive culture starts with startup leadership.
The startup leadership usually means the founders of the company. A good managerial style and positive interaction with the employees will help establish a good company culture and help retain employees at the low phase of the company.
Be on the lookout for changes that you can make to help your business become more positive and implement them. Create a company vision and set goals. It will help you execute effectively and make your employees feel like they are working for a purpose-driven company, giving them a sense of accountability.
While hiring new employees, ensure all the legal paperwork is taken care of appropriately. If the offer letters are not drafted properly, it may cause you harm. Ensure you include the important safety clauses such as non-disclosure agreement, acknowledgement form, non-competition clause, indemnification clause, etc., that protect the company in the offer letter. Also, comply with the labour laws when you hire your first employees.
Hiring new employees comes with legal responsibilities and compliance. If the Employees Provident Fund (EPF) and the Employees State Insurance (ESI) apply to your company, then you must enrol your company for the same and provide the insurance and PF to your employees on time. You must also comply with the TDS provisions (if applicable), create payroll and issue forms under the Income Tax Act to your employees.
Hiring your first employees requires forethought and the establishment of certain processes. It is a new learning experience for a startup. The first employees are the important people who will help you grow your startup. Thus, it is important to take time and establish the hiring process and hire employees who share the same vision as you.
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I am an advocate by profession and have a keen interest in writing. I write articles in various categories, from legal, business, personal finance, and investments to government schemes. I put words in a simplified manner and write easy-to-understand articles. Read more
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