Every business starts with an idea, but sometimes it just doesn’t seem real until you start telling other people your plans. When you invite someone else to join you in your new venture, it’s a huge step in making your dream a reality.
You need a lot of things to run a successful startup, but they boil down to this: have a good product, spend as little as you can, and bring good people on board right at the beginning.
At the very beginning of any startup, you might have an ultimate goal in mind and you might even have some idea about how you’re going to get there. A good team will help you find the best way to get there, ensuring that your product is the best it can be and that people are going to want it.
But things change after the initial stages, and the hiring process should adapt to meet those changes. Here are a few things to consider when bringing people on board.
Bringing on the right people is essential at the beginning when you’re on a tight budget and you’re confident but apprehensive about the future. The amount of money you have and how you spend it is key at this point. You need to spend money to make sure you can develop and scale up, but you also need to make sure you have money for the next phases.
At this stage, having the best possible people involved is key to building and marketing the business. But you don’t need a lot of people. You just need the right people, and that may mean only bringing on one or two other people. One should be skilled at marketing and sales and know something about the industry. This person would primarily be responsible for reaching out to potential customers and getting feedback to make sure that they want to buy what it is you’ll be selling.
The other person you need is someone with the technical know-how to produce your product so it can be tested and refined.
After you’ve worked out the details, built prototypes, tested, modified, and secured additional funding and resources, it’s time to take things to the next level, and your small team will need to expand. That said, remember, you’re not a traditional business yet, so you need to think outside the box to figure out what roles you need to fill.
People brought on board at this stage aren’t quite partners, but they’re more invested in the company than a regular employee would be. This early team is essential for scaling up and is there to help the business grow. At this stage, you’ll not only need people to produce the product but also deal with the financial and legal sides of the business.
At this stage, you have to be careful not to scale up too quickly. Don’t hire anyone you don’t need yet and decide whether it’s better to bring on a new employee or outsource some of the work. Hiring a new team member can add a lot to the culture of the workplace and gets another person invested in the early stages, but it increases fixed costs when you may not need to do so just yet. In the early stages, outsourcing is generally more sustainable.
Teamwork at Every Level
Don’t underestimate the importance of a good team in your start-up’s success. Every business is unique and has different needs, but every business benefits from an exceptional team. When deciding who to hire, consider how much investing in the right person will help the business grow to get the best return on investment. The converse is also true. The wrong team can be catastrophic and costly.
It’s understandable to be worried about costs in the early stages, but hiring the right people is not a decision you’ll ever regret.
Any opinions are those of Thomas Fleishel and not necessarily those of Raymond James.
This material is being provided for information purposes only and is not a complete description, nor is it a recommendation.