E2: Hiring your first 10 employees

TRANSCRIPT

Alex Levin: [00:00:00] Hi, this is Alex Levin and Rebecca Green. And we're here again with 15 minute founder. Thanks for being here, Rebecca. Thanks Alex. So I twisted your arm this morning and said, you know, we have to talk about, you know, the first 10 employees we would hire at a startup.

You know, if we did it all over again, I actually think we did it pretty well, at Regal. But, you know, learning sort of everything this time and learning everything we learned at the last couple of startups, you know, what would we do? So, you know, maybe to start let's like step back and like, you know go back to the beginning.

So, you know, it was you and me in a room, you know, we had a business idea, we had validated with customers. We hadn't yet raised any funding. So we knew that, you know, anybody that we hired was coming out of our own pocket. So there was, you know, a higher bar, let's say that, you know, who we're going to hire.

You know, what were you thinking about in those days, you know, as you were thinking about the first couple of people?

Rebecca Greene: Yeah. If, if I remember like the framework that we used at the time was, um, one [00:01:00] is like, who, who can we trust, right? Like, and who would trust us? Because we basically had nothing except our experience and our deck.

And so we had to find people who would trust us, and we had to find people we would trust, who, you know, with very little guidance and, and no roadmap before them, like, could, could work with us day to day and figure things out. That's number one. I think number two was, The classic thing of like just really scrappy people, people who didn't need the whole world to be predefined for them and who were willing to do anything and wear any hat, regardless of what the title.

Said on their resume that's number two for me. And then I think, and tell me if I'm wrong, like the third most important thing at the time was like, it was ICs and it was not, it was not senior leadership, it was not, you know, people who had run massive teams. It was like, how do we get the first best ICs who are really gonna like.

Dig in and do work and grind.

Alex Levin: Yeah. [00:02:00] And you didn't say it explicitly, but you know, neither you nor I, we're going to actually code the app. We weren't going to be the ones that were going to be the engineers. And so both of us were product managers growing up and it worked a lot in building technology, but we weren't going to be.

the ones doing it. And so, you know, we have to also go and make sure that we were finding the right engineering talent that we wanted to work with. And we didn't immediately go out and find to your point on engineership. We were looking for people on the engineering side that we thought could be great ICs and, you know, maybe we could scale into leadership over time as the company grew.

And, you know, thinking back, we got amazingly lucky. We started by our network and talking with a couple of people that we already had worked with and started asking our friends who they had sort of worked with very early and one of our friends who was a CEO of another company recommended actually some consultants, some contractors that he had worked with in Europe.

And like the very first person that we hired ended up being just, just an amazing, amazingly talented [00:03:00] person. And we got very lucky there. Like, I don't know, like, as you went through and met all those different sort of early in. How did we end up making the right decision? Or is it just dumb luck that we ended up getting somebody talented?

Rebecca Greene: Yeah, so good point. I think like the thing I didn't say also specifically about engineering, given that that was not our background was finding the right engineer who would not only execute at the level, but feel would feel comfortable. Making some like technology choices early on without really having the right, like, foresight of knowing exactly what was going to work out and feeling comfortable with those decisions and not feeling like, oh, we need to write RFCs and be bogged down by all these choices and whatever, and just like, be able to take that uncertainty, make the, make a good decision, a fast enough decision.

And then the second piece is, Like clarify the why behind those decisions to me and you so that we could participate and give guidance even if we weren't into the weeds of the technology. So that's [00:04:00] not necessarily what every company looks for in an engineer. Like, who can explain this in English to us?

But that was really key. You're right. We got lucky. I think. The first two people we hired and brought on to the company were Robert and Tim and one, like you said, came through a recommendation of a contractor and one came through our personal experience working with them in the past. I, I think there was luck, but I also think, like, so for Robert, let's take it.

We pitched the idea. We drew like this crazy. Drawing on a PowerPoint that we still have and he came back like, 24 hours later, had written an entire doc, like embracing that vision and talking about why X, Y, Z technologies will be the right one and how we would accomplish this. And it was just so clear that this was the right person who, like.

understood the vision so quickly, documented their thoughts, stayed up a whole night to do it and like articulated in a way that you and I could react to and give feedback to, to me, that was like such a strong signal that, okay, that's perfect. And it's not that like, we got lucky that that was [00:05:00] the first one.

We talked to like three or four other people like that. And like nowhere near the same level of responsiveness to, to how we were thinking

Alex Levin: about this vision. Yeah. I mean, I reiterate your point. In a way that we understand there are certain careers where there's a lot of vernacular or a lot of training required and I think of like law as another example, it's not just engineering where, you know, there are lawyers that you go to with a problem and you hand it to them and they say, okay, this is the solution and I don't understand what they're talking about and I don't think that's acceptable.

Actually, there's other lawyers who see it as their job to support the aims of the business in giving the leaders of the business. The tools to make the decisions they need. So here's the challenge that we have you know, we hand it to legal and they come back and say, look, based on what's going on, here's the, the issue at risk, here's the trade offs you have to make.

I recommend doing this based on my experience. Great. Now we can all make the decision together. So whether it's a lawyer or an engineer, their ability to. Understand the [00:06:00] complicated things and turn it into a decision that everybody can make together. Yeah, I agree. It's just absolutely critical to the success of the business.

Otherwise, you're going to just have somebody working off on their own without the ability to get feedback from other people in the organization. So I agree. I mean, and we were, yeah, so we were, I think engineering hire only until higher six, seven, something like that. And finally, then we started thinking about perhaps having a business person.

And the advice that I got from a CRO actually that I know, which I think was great advice was in a B2B SaaS environment, you know, as founders, we're going to be the ones constantly out there talking to customers, selling to customers, get a, I think you put it as a BDR plus. And what he meant was get somebody who's going to be on every sales call with you, who's going to be able to help you outreach to more people, help you follow up with more companies make sure that you're really effective and continuing to sell.

And looking back, I like, I was definitely too slow in hiring somebody like that. And it meant [00:07:00] that there was a week where I went and did something else and needed to set up a different piece for the company. There was a week that we were prospecting basically. And then a week or two later, we didn't have anybody new to talk to.

And I've, if I look back at the, you know, number of new customers added, it was very correlated to that, which it shouldn't have been. And so I think eventually we got people like that and it was helpful, but you know, it's, it's something I recommend to everybody on B2B SaaS now is the founder should be in every call.

You should not be hiring a VP of sales that early. You should be hiring somebody though, that's a force multiplier who eventually can become either an AE or a leader in the company. Because they've listened to everything that you've said and they've helped move every deck and every, you know, follow up email.

So, that's something that, you know, was good advice and I wish I had followed sooner

Rebecca Greene: actually. Yeah, I think our, so we did all of the sales. Calls and all of the servicing of customers for at least the six months sales through 12 months. Right. And then, like you said, our first non engineering [00:08:00] hire was Brian, right.

On CS. And it was like him helping us like with servicing customers

and

Alex Levin: scaling that. Yeah. Yeah. I mean, I think it was great that we did it. It definitely meant that we had a greater appreciation of what customers needed. If I think back to those days. You know, we didn't make a decision to go build and then show it to customers.

Like we made a decision to go find some customers who knew we were very early, give them an early product, you know, make sure that it showed revenue for them, even if it was an early product, but then wait to see what their feedback was. And when somebody said, you know, eight times, please, can you help me with this?

Then we'd know that was an important feature to go build. And we knew what mattered to them, but we only knew because literally we had done an eight times, like we were the ones actually doing it. And so I think, you know, it's a critical part to not over hire at the beginning, because if founders get too far from that, yeah, it becomes difficult to actually make the decisions about the product.

And I, you know, I talk about it a lot with folks like early days, being a [00:09:00] founder is super challenging because you have to have this clear vision. At the same time, you have to know when to take feedback and change your vision or change what you're doing. And the only way to do that is if you're super close to what's actually happening.

The second you step away and somebody else is the one there, it's too far. So, you know, I think that was good, you know, at about sort of seven, yeah, we hired some business people and we started, you know, scaling up the team a little bit. So at that point, you know, there is something of a product. We had some customers, we had some revenue.

What are the characteristics, you know, that you think are so important? I think between you and I, we've probably hired a few hundred people over time, you know, in relatively early stage startup fashion at this point have kind of a gut instinct about it, but what are you actually looking for?

Rebecca Greene: Well, there's things I look for, like on paper before people even join which is.

you know, have people, ideally people have worked at a similar stage company before or are right out of school where they don't have big company[00:10:00] whatever the bad behaviors that come from a big company, meaning like so over resourced, like you just do one very narrow thing very well. It's just like not how you're going to be successful in an early stage startup.

So that's on paper. The other thing I look for on paper is people who have had Who have dug in at a place, assuming they're not right out of school and who have stayed three, four or five years at a place because it demonstrates commitment and growth at different stages of a company to like figure out how to be successful at different stages.

And that's what it takes to be a founder. And that's ideally what you have in each of your early and later team members as you scale. That's like what I look for on paper. You know, once you, once we meet people, like the things that I look for are. juSt like incredible, like self motivation and problem solving and ownership, like people who just want to get shit done and like, this is the cliche, but it's so true and you could see it in people, how they talk about their hobbies, how they talk about their previous work experience.

People who are intellectually curious about [00:11:00] the problem you're solving and why you're, why you're solving that because, you know, not asking about, oh, what's your policy on X and what's your, like the classic, like company questions, but digging into the problem because that means. That they themselves are going to be that way and you just want people who embrace the problem that you're, you're trying to solve as much as possible.

There are other things I think make people successful over time in their careers and working with us that, you know, I've spoken about, like, are they a structure thinker? Can they articulate the problem that they're trying to solve, the way they're thinking about the solution to us so we can participate in the decision making?

with them, because like you said, that's what builds trust. And that's what builds a good working relationship such that we can start to over time step back and like actually scale decision making. It's if you trust in their process and in their decision making. So, you know, and data as part of that, obviously as you get bigger, those are things that come to mind.

Alex Levin: Yeah. What are some questions that you ask in those like interviews for very early [00:12:00] employees to help you understand if they're the right person on those aspects?

Rebecca Greene: Some of them are, like, super simple ones that anybody would ask. It's just I'm looking for something potentially slightly different, which is...

Tell me about a problem you, you found really interesting or were passionate about and like how you, how you solved it. And I'm looking for, do they give me the context of why they were solving that problem? Why it was important? Do they start with the customer ideally? Because we want people who are truly customer first, right?

Do they then take you through? Like what was hard about it and what the challenges were and do they then structure and say, here's how I was thinking about it. I had X, Y, Z options and then tell you what happened and then, like, tell you what the result of it is, but ultimately you care about not only people who put in effort, but you understand what matters is really the output and the impact that it has.

And are they talking about measurable impact? I don't think I asked any, like, Brilliant or tricky questions. It's like, I'm looking for the structure thinking, the [00:13:00] values as people are answering.

Alex Levin: Yeah. Or, you know, I, I like asking people to explain kind of why they've done what they've done, what they want next, you know, I sort of asked, I'm assuming, you know, this at Regal works, you know, and you're talking about your next role, what do you want to be doing in five or 10 years from now?

One of my favorite questions is, you know, imagine I went and asked your boss about you, what would they say? And it's amazing. People all of a sudden open up all the sort of you know, the shell goes away because they understand that we could actually ask their manager. And people are, you know, one in one or two camps, either they clearly don't know and don't to your point, then they don't have the sense of accountability and self understanding that we're self reflection and we want, or they become very open and about their strengths and their weaknesses and they clearly really know them, which is great.

Everyone has weaknesses. It's not about whether they have weaknesses is do they understand them and. Do they have coping mechanisms that allow them to still succeed or are those things that you know, [00:14:00] they want, they're continuing to work on to go be more successful over time. So those are some of the questions certainly I like early.

I mean, if I think back to the folks that I've hired that have been great, I think a few tricks early you know, which relies on other people, but you know, one is, you know, did they go to a top 25 school or were they in a top sort of consulting banking program? Those are great cheat codes for somebody who probably has a certain level of intellectual rigor.

Is that the only place to find those kind of people? For sure, no. But, you know, if you have not done a lot of hiring, that's a great way to, again, find great people, even if you're not sure who to hire you know, then we want to for sure make sure that they've been at a small environment before, not a startup in a big company, but literally a small environment where to your point, they have no resources.

And that they enjoyed that. I mean, it's sort of, you know, I used to try to push people more and convince them to try to come early and that's like a [00:15:00] trap that I fell into a lot and I don't do it anymore. Like I'm very honest with people about the fact that I love this stage and I love building and I explained to them why I like it, but in the end of the day, then they need to make that decision and opt in.

Do they want to be in an environment where there's more growth and more opportunity? But the flip side of the coin is. Things are changing very fast and it's not exactly clear what you're going to be doing tomorrow is. And some people, you know, just love that experience and that's what they want to do.

And those are the people that we want to then convince that, you know, this is the right of the startups, you know, this is the right opportunity. You know, but I've stopped trying to convince people that may be great, but are looking for something else to, to come to this stage. Cause I don't think it benefits them or

Rebecca Greene: us.

Yeah, the other thing we do that I think is unique based on talking to other founder friends is we make everybody do a project. And really, like, it's not to put a time, like, it's not a whiteboarding session. It's like, give them time, go home, here's a problem, let us see the, the quality of your work product and how you think, [00:16:00] and then let's discuss it and see how you react on the spot.

And this is untraditional or nontraditional, but even for engineering in the early days, we used to make them do a project. Right. Oh, I think it's a

Alex Levin: great way also for them to see how we give feedback because it's such a critical part of their experience. And you know, I think it's odd actually that people don't ask hires to do it more often because by seeing how we give, you know, feedback and how we're asking questions, they can see if it's the type of environment they want to be in.

So I think that, yeah, that I agree is different. The other thing that's, I think we're more, it's not that other companies don't try to do it. We're more regimented about is that when we like a candidate, we will explicitly ask them if we were to give you an offer, would you say yes? And we will not give an offer until they're at a point that they will say yes.

And you know, why do we do that? Well, all of a sudden things come out. Well, I still need to ask this person. Or actually, I have two other companies that I'm talking with. Or, you know what, like, I want to wait to see if I get this other offer. Well, now you know the situation that you're in. You know if you're the [00:17:00] first choice.

You know if there's, you know, more work you need to do. You know what the objection is. After you've gotten through all of that, then if you ask it again. And they say, yes, great time to go make an offer. But I think a lot of companies, once they like a candidate, the first thing they do should have an offer and it's not helping anybody because, you know, it's not actually the right job for them necessarily, you know, it's better that you both make sure it's what you want to do.

And then, you know, from a comp perspective, you know, there are a lot of resources for what market comp is, and you should be paying somebody market comp, not what you happen to be able to pay them because you negotiated well. So decide that you like them and then agree that you're going to pay at market or above market, whatever your policy is for a company so that everybody's on the same page.

So

I think those are some, some of the rules. I mean, just to close out here, you know, are there any mistakes that you see often or that you think we've made? That you'd sort of suggest people avoid. We've

Rebecca Greene: definitely made [00:18:00] hiring mistakes. That, that is inevitable. I think a couple of things I would say is bake that in, like in your planning, like you will make mistakes.

I think, you know, we don't have time to go deep into this, but don't make it. So you need to have like. The 90 day check in. You need to have the plan to onboard. You need to be intellectually honest with yourself and the candidate if things are not working out and move on quickly as well. Like people make mistakes on both sides of the equation.

Like you only have so much information about one another before they join. So don't. If you drag out that process, if someone's not working out, it just raises the barrier of getting your, your hiring practices like perfect. And I think that risk is, especially as an early stage founder, like it's just that burden is too big.

Right. So I think like, it's not just about hiring. It's also about your like firing practices, promotional practices, et cetera. So that's one thing I think that, yeah, the mistake I think we make sometimes or have made in the past is about thinking somebody with a big title from a big company, who's done something [00:19:00] successfully in the past before.

Like falling to and to in love with that, even if you have reservations about our process and how they performed through our process or our project or things like that it's so enticing as a startup founder, maybe not in the first 10 employees, but as you get bigger to be like, Oh my God, this person has done this before and they've done it at the best place possible and think that it's going to work at your company.

And I think that's a fallacy. And so like, trust your process and your own gut above

Alex Levin: that. I know you and I sort of. Yeah. So given the choice, love people who are generalists, perhaps may not have that specific knowledge, but you know, are willing to learn perhaps more than somebody to your point, who's, you know, too senior and you will find perfect candidates.

We're not saying don't look for perfect candidates who are at exactly the right stage and have the knowledge. That's great. But if you can't find that and you're making a decision about between too much experience versus a generalist. That's great. You know, we generally believe that the general should be given a shot, which is, I think, a little unusual.

Yep. Well, [00:20:00] we're out of time for today, so thank you, Rebecca, and we'll be back soon.

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