In 1980’s there was a saying: "Never hire anyone straight out of IBM. First, let them go somewhere else & fail. Then hire them". 3 reasons why this saying is still relevant: IBM was the most dominant computer company in 1980s. Everything they touched, turned to gold. So startups scrambled to hire IBM executives for senior positions. This rarely worked & often led to spectacular disasters. That’s where this saying comes from & I think it still applies today. It’s tempting for a startup to hire a senior executive from a big established company. They will bring all the big company’s secrets & help your startup get better & bigger, faster. But this never works for 3 reasons: 1️⃣ STARTUPS ARE NOT SMALLER VERSIONS OF BIGGER COMPANIES → Just like a 5 year old is not a half a 10 year old, a startup is not just a smaller version of a bigger company. It is a unique & different entity. → Everything from strategy, systems for goals & decision making, team roles & velocity of working is different for an established company compared to a startup → In fact big company executive might cause great harm by trying to institute big company practices prematurely 2️⃣ IT’S HARD TO KNOW THE ROLE THE EXECUTIVE PLAYED IN THE BIG COMPANY’S SUCCESS → There are 100s of factors that make a company mega successful: great market, great product, great timing, great team, luck. → In most cases it’s hard to easily tell if this person was critical for the company’s success OR the company’s strengths made this person successful → Take fishing as example: If you just see someone’s end of day catch, you can’t really tell if the person is great at fishing OR they just got lucky by fishing in a lake with lots of fishes, favourable weather & no competition. You will need their fishing record in various conditions to say anything with confidence 3️⃣ EVEN IF THEY ARE A STAR, IT’s NO GUARANTEE THEY WILL BE A STAR IN YOUR STARTUP → Most startups are tiny entities going after big problems with limited resources & against established forces → It takes a particular kind of person to thrive in this environment → So even if you can genuinely show that the person was instrumental in the big company’s success, it’s no guarantee that they will be able to apply their strengths to the chaos of a startup The best person to hire as a Senior executive for your startup is one who has previously taken a startup of your size & made it a big success. Someone who has ‘been there, done that’ & is looking to do it again with you. But if you can’t find that person & you have to hire someone who only has big company experience, then make sure you do Simulations. It’s my best advice on hiring Sr. Executives & it allowed me to hire 6 rockstar leaders in 2 years for my startup (post in comments) ————————————————————————- What’s your best advice on hiring Senior Leaders for startups?
Topic
For Founders/CEOs
Published On
September 7, 2023