What constitutes a key role at different stages of a startup may be different though. Every wrong hire sets you back, forces you to fire-fight, waste time on things that you aren’t supposed to be doing, and prevent you from doing the things you are supposed to be doing. Getting the key hires wrong in a highly competitive situation where one large competitor is snapping at your heels, or worse still ahead of you, can create irreparable damage. Working with a sub-optimal team is stressful too. It’s like trying to get a plane to take off in the face of intense drag from headwinds (some aviation aficionado told us that this isn’t the right analogy because aircrafts take off faster when they fly into the wind; but it sounded nice and intuitive, so we will go ahead and use this even if it is technically incorrect). You may need a longer runway, and worse still you don’t know whether you would ever get airborne! While everyone acknowledges that getting the right people on board is important, some of them say this because it is the right thing to say. It doesn’t trouble us to see entrepreneurs, who do not genuinely believe in this, facing problems. We are troubled when we see entrepreneurs who truly believe that getting the right team in place is important but don’t have the knowhow on how to go about it. The kind of fulfillment you experience with the right team in place cannot be easily described in words. You feel less stress; less upset with the world at large; your sleep is less disturbed; you are not solving the same problems again and again; and the office doesn’t come apart when you are on vacation (and maybe runs better).

Ask any second time entrepreneur and they will tell you that ninety percent of an early stage startup success is about the team and just ten percent can be attributed to the quality of the idea. The first few hires are crucial. They would have to buy into your vision and often give up well paid jobs to take the plunge. Imagine why anybody would want to make this leap. You, as the founder/s, made this leap for obvious reasons – you had a great idea, believed that there is a market around which you could build a profitable enterprise and become rich. The first few employees would have fairly similar motivations. They may not have had the idea, but are willing to believe in your idea and stake their careers.

So, these initial employees are like owners. You need to be grant them attractive sweat equity. You need not, and cannot, pay them market compensation in terms of cash though. The initial few employees will also need to act as a magnet for attracting further talent. They need to be individuals who others would love to work with. They should be living embodiments of your beliefs and culture. Their behaviors (like yours) would shape the culture of the startup. The early phase would involve a lot of uncertainty, and some near-death experiences. So, hire people who are not easily squeamish. Ask yourself these questions,

Try and hire people with potential. A track record of performance comes with some negatives, though not always – a sense of entitlement, a reluctance to go through the rough and tumble, and not the least high cost. In other words, you need people who can punch above their weight class. You need people with high energy who are not yet constrained by silos and boundaries – and above all, a willingness to be inspired, led, and shown the way. While you need people with a lot of initiative, and an ability to do a variety of tasks, they should also possess an ability to run something specific as the startup scales. Each of them should be able to evangelize your company with prospects, customers and potential employees.

Diversity is helpful. You need people with complementary skills. The biggest challenge with a diverse team is that it sounds good on paper, but in real life most people tend to respect and love working with people like themselves. Therefore, you need a critical mass of “binders” who act as a glue and help leverage synergies between different teams. One or more founders need to play this role at an early stage.

The push to close an open position with speed can come from two sources, namely a) not having a person in the role can create such obvious pain that you tend to ignore the less obvious wisdom that having the wrong person in the role is a temporary relief that creates more harm in the long run. Hence, the pressure to close a position quickly, and b) Boards can put inordinate pressure to close positions. Boards can be very short-sighted at times – closing an open position is a measurable outcome, but a position closed with the wrong person isn’t measurable easily, and Boards sometimes tend to focus on solving the ‘obvious’ problems rather than the ‘right’ problems.

Being taken in by great communication skills is one of the most common mistakes. Some smart candidates are very good at evading questions that check for depth & substance. And you, the interviewer, may not even realize you are being out-maneuvered! Don’t hesitate to test candidates for senior roles for their ability to be hands-on, or for their depth of understanding of issues or insights. Do it with some skill and refinement, but do it. One thing I can say with some degree of confidence is that a leader who does not have depth or attention to detail will eventually prove to be a problem. The additional damage such individuals, if hired, will create is that they will end up hiring similar people in their teams. You may not even come to know until it is too late that there is a problem, because multiple layers of cosmetic and clever people can hide problems for a long time! Therefore, never take a chance, and ensure that anyone you hire, irrespective of level, has a detail orientation.

Assuming that someone who has worked in a ‘scale’ environment knows what it takes to ‘build for scale’ is another common hiring error. Nothing could be further from the truth. A majority of the individuals that have worked in a scale environment have no clue on what it takes to build for scale. Therefore, if you are at a stage in your journey where you need someone who can build for scale, then check for that specific ability; more on this later.

Figuring out whether a person takes ownership (as opposed to being a bystander, cynic or victim) is very difficult in a 90 minute meeting, especially if the person is a good communicator. Therefore, have your antenna in a high state of alert to pick up the weak signals, and amplify these through deeper questions to understand them better.

Getting the timing of the key hires right is crucial. You also need to get a little lucky on this. But you need to do what you need to do and not rely on your good fortune. Hiring for a skill well ahead of time or delaying hiring for that skill for too long are both equally damaging. At a very early stage, it is good to hire someone who is extremely hands-on and does not nurture aspirations of strategic contribution or leading a team. At a very early stage if you do an over- kill on seniority and the conditions for leveraging the skills that this senior person brings to the table do not exist, then you end up having a frustrated senior, and a team that is wondering what this over-paid dude is doing here. If your business is in a take-off mode and you delay bringing in someone who has the skills to hire and build teams then that is equally detrimental.

Over dependence on a recruiter is another big problem. As a function head or a founder it is your primary role to get good people excited to work for you or your firm. You should be blogging, and candidates that matter should know what you stand for. You should woo and pursue great people who are not looking for a change. You should be building relationships even if you are not hiring – you don’t know when you would start hiring. One learning we can share with a high degree of conviction is that function heads who think that recruiting is the job of the recruitment team are totally unsuitable for startups. This reflects a big company syndrome. A big company has a brand. In a startup, the brand is created by the quality of conversations that the function head has with the prospective candidates. At a startup, a good function head has too much pride to leave recruiting to the recruitment team.

The last problem is not getting back to candidates that you decide not to go ahead with. Getting back isn’t easy. It is something that a lot of recruiters and hiring managers ignore. It is one of those difficult and sensitive conversations. They don’t realize that this behavior is unprofessional and chicken-hearted. The word invariably gets around and good candidates would tend to stay away. So, however difficult it may appear, go ahead and call the candidate whose candidature you have decided not to go ahead with.

Alignment is extremely crucial for a team. It makes working together easy. You don’t have to be worried whether someone would make the right decisions in the absence of your participation or inputs. Alignment is best achieved by intense interaction in the early stages of working together along with a lot of unadulterated feedback. These interactions and feedback should focus on ‘the way we do things’ – it could mean for example that speed and urgency is important, it could mean that anecdotal stuff doesn’t count here for much, it could mean that we will have conflict but respect for people is non-negotiable. These are just some examples. There is no other alternative to getting the new hires to be in sync with the founders (or the leaders) quickly.