Hiring veteran executives to fill out your C-suite is a luxury most startups will never enjoy. Hiring young, untapped or junior talent, however, is a challenge that all startups face. Moreover, growing green talent capacity into C-suite capability layers on yet another set of difficulties to the already strenuous life of a startup. Navigating this is less science, more art. Some founders rely on being highly extroverted, others in having established credibility within specific industries or groups, and some—to some extent all of us–just power through conversations and interviews in bringing together that band of people who will man the boat and struggle to make it out of the tides and into deeper water. When we do stumble onto the winners in our teams, those people who seem to magically tackle anything thrown at them, retaining them is critical. Losing them? Unacceptable.
Several years ago, while driving back to Utah from a team off-site, one of my colleagues, Caleb, shifted uncomfortably in his chair, and in a strained tone let me know that he had accepted a position at another company. He was a natural star, a fast learner, and someone who lifted the energy of our team, so I was shocked! I stumbled through a discussion over why he left and ultimately wished him well in the transition. I think he was the first direct report that I had regrettably lost, so I didn’t feel entirely prepared for the difficult discussion, but fortunately for the both of us we parted ways on a good note, and our friendship remained intact.
Fast forward a few years. A group of us from that former team had a reunion lunch, at which this friend was present. He pulled me aside to take me up on an offer I had extended earlier in the year to explore potential roles within our Peak Ventures portfolio of companies. To my delight, Caleb joined one of our best teams and, per his usual, had an immediate impact on an already high performing group.
As I think back to that awkward drive in which Caleb let me know that he was moving on, I realize now how important it was to have maintained the friendship even in the face of disappointment and company preservation. It would have been so easy for either one of us to burn the bridge. But people like Caleb are exactly who you need to win in startups. And the ability to attract and retain your best team members is a necessity if you want to win.
Not knowing Caleb’s side of the story, I reached out to him to gain some insight. I was reminded again why I absolutely love working with this guy. Here are the takeaways:
- Make time to understand the aspirations of your people and whether they align with your Company Narrative. Your Company Narrative is your product and the value it creates. Assume the human-to-human connection has happened (your employee to you or to your team). This is the human-to-business connection.
- If we are talking high-performing, relatively junior talent pursuing early-stage ventures, it is never about the money. Take out any one of those characteristics and it can easily become about the money. If you find that in a startup a person is driven by money, then with certainty you can remove either ‘high-performing’ or ‘junior’ as a characteristic of the person.
- Life is too short, and the communities we work in too small to treat people poorly. This does not mean placating everyone (the easiest way to offend someone is simply to stand for something)–but rather being real with those closest to you. Be bold enough to make mistakes and humble enough to admit them. Those team members in whom you invest significant time will be your biggest advocates or your most vocal opponents.
- Role may not be the most important consideration of ‘fit.’ Putting aside highly specialized roles (i.e., one requiring a technical skill), ask yourself: “Do I need people who will bleed with the team and believe in our product enough to love it when it’s ugly? Or do I need a [fill in the blank with the role]?” Most times, the answer to this question will be the true-blooded believer. There is a prioritization for startup success: team, then technology, then title.
- Know what drives your people. Make the time to understand them.
Caleb’s insights were meaningful to me, so I’ve included some of the key moments of our conversation to emphasize the critical points.
Sid: Think back to when we were driving back from Idaho and you dropped the bomb. What led to that decision?
Caleb: It was something that had been on my mind for a while. I had also known that when the decision was made, I wanted to tell you right away out of respect to you and the organization. Major factors in the decision were: lack of confidence in myself, lack of confidence in product, didn’t see this as a long-term fit, had ideas for improvement and struggled to get proper buy in, I loved the team I was on but just couldn’t seem to get in swing with my immediate team.
Takeaway: Establishing trust and mutual respect with each member of you team is good; understanding their belief in the mid- to long-term horizon in product, personal trajectory, and team is best. You have to make the time to understand the ambitions of your people and if they align with your Company Narrative.
Sid: What could I have done to retain you and why do you think I missed taking that step?
Caleb: That’s tough, it was really a decision that I felt needed to happen. That said, I think too often when employees leave, the employer thinks it’s a compensation issues. Money was the last thing on my mind. In fact, I took a 30% pay cut when I left; closer to 50% when you factor in benefits. There were a few folks that came and tried to offer me more money. I did really appreciate your response which was focusing what was best for me (and my family). Ultimately, we just had a different opinion on what was best for me at the time. I also liked how you focused on why I should stay, instead of why I shouldn’t leave. It was because of this that I knew I needed to leave because you deserved someone who was all-in and I knew if I stayed I would be half-assing it.
Sid: What contributed to us staying in contact (versus just falling out of touch)?
Caleb: There are a lot of reasons. 1) We were/are buddies. 2) I always respected your business and personal life and knew you were/are someone I want to be like. And 3) for selfish reasons I knew you were/are well connected and might know of something I should be a part of.
Sid: What did the other companies you were at fail to do (or was it just natural to your career growth) to retain you?
Caleb: A large part of it is career growth. That said, I always try and balance career fulfillment and family stability. At a previous place I loved the career/team but didn’t really feel like I could trust the company long-term.
Sid: What attracted you to where you are now?
Caleb: 1) The team. I love working with people who get what we’re building and have the skills/grit to back it up. 2) I enjoy our client base. There is something fulfilling about working with small to mid businesses and know I’m making an impact on their business. I constantly ask myself what kind of value we are driving knowing that every dollar counts for a small business. 3) I feel career satisfaction and know that my family will be taken care of.
Sid: What advice would you have to managers and teams seeking to retain high performing talent like you?
Caleb: I think managers and teams have the advantage in retaining talent. Transition is hard and employees would rather stay in a good place where they feel valued. I think the important part is understanding what makes each employee feel valued: money, leadership, career trajectory, work/life balance. From there, let the employee know that they can expect these things based as performance dictates. The same as every employee should know if they need to step up their performance to stay with the org, every manager should know what they need to do to keep their stars in the org.
These experiences with Caleb come full circle for me now, from our initial team together, through staying in touch, to placing him inside one of our great Peak Ventures portfolio companies. Patterns are clear to me: Hiring and retaining great people in a startup is hard. It’s an art. When you are fortunate to land on those people who care about as much as you do, and who execute on your business as good or better than you do, retaining them is your priority. Do whatever it takes so that when the moment you and that team member are driving back to the office from an offsite—as Caleb and I did so long ago—they won’t be shifting uncomfortably with the breaking news that they will be departing, but rather on the edge of their chair with excitement about your future together.