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The bottom of the funnel is all about closing the candidates who have made it through the evaluation gauntlet.
These candidates have already passed through 1) The Top of the Funnel — Sourcing and 2) The Middle of the Funnel — Selling and Evaluating.
As discussed in the posts linked above, sourcing, nurturing and selling passive candidates is a crucial skill for startup founders and their teams in the current recruiting environment. Greater competition for talent has yielded the need to develop a great recruiting process early on in a startup’s lifecycle.
In this third and final post of this series, we’ll dig into the bottom of the funnel — closing and onboarding, the final stages of the recruiting funnel.
Frequently we see startups making the mistake of underestimating how much effort is needed to close a candidate. This is particularly true for executive level positions. As in any strong sales process, make sure you understand all of the decision making criteria that your candidate will be using, what they care about most, and where your company stands relative to their other options. Understand if their spouse or significant other plays a role in the decision. If so, consider inviting both out to dinner so you can sell the significant other. For more senior hires, don’t hesitate to use dinners instead of meetings or lunches, as these are a great way to create a relaxed atmosphere that is free of time pressure.
Sarah Nahm, the CEO of Lever, offers a helpful comment:
“I’d really encourage founders to strategize about what their winning advantages are and develop confident playbooks for competitive offers with a) larger cash-rich companies and b) smaller startups offering high ownership. All the better if you can train your managers on the same playbook and democratize the skill.”
Don’t be afraid to use your VC’s to help with closing. Their stories of why they chose to invest can be very powerful in the sales process.
As Mark Suster points out in this blog post “Why recruiting isn’t over when an employee accepts your offer”, you enter the most vulnerable period right after a candidate signs your offer letter. This is when their current employer and any other firms they are turning down will make their most aggressive attempts to change the candidate’s mind.
In particular, for executive hires, watch the date when the candidate resigns from their current company. Consider setting up a big dinner with them and the rest of your management team, and possibly board members that same evening. This way they will go into their resignation meeting more committed, as it would be embarrassing for them to have to cancel the dinner and back out.
Executive recruiting is one area we usually recommend our portfolio companies hire a recruiting firm to help.
As a founder, you still need to actively search your own network, but a strong executive recruiter (despite the cost) can bring talent to the table you’d likely miss. And, they can bring several good candidates to your attention at the same time so you can make comparative assessments. As with any service provider, you’ll want to reference check the recruiter you’ll be working with, which is more important to check out than the recruiting firm. It’s also useful to get recommendations for recruiters from your investors or friends.
Good VC board members can help with several aspects of executive recruiting:
Once you have put this much energy into recruiting a great candidate, it makes sense to invest the time once they are hired to help them be productive as fast as possible. The impact a strong onboarding process cannot be understated.
In areas such as sales and development, it can make a dramatic difference to productivity levels. Similarly, for other positions such as customer success where new employees will be talking to your customers, it’s also easy to understand the importance of great onboarding. You can read more about the topic of onboarding here.
It’s no longer enough to be great at developing products your customers want and knowing how to market, sell, and retain customers using a repeatable and scalable machine. There is now a third skill you must master: building a recruiting machine to land the best talent in an incredibly competitive environment.
Recruiting is a function almost every part of the company needs to be involved with to make it work, but it also works best when there is a single person who owns the function. In the early days, it’s more helpful for this person to be a recruiter, not a recruiting manager. But, if they can manage other recruiters as they join later on, and be an active recruiter in the early days, so much the better.
A key recommendation of this article is to consider hiring your own in-house recruiter far earlier than you would have done in the past. For many companies the right timing would be as soon as you have raised your Series A round and need to staff up engineering, marketing, sales, etc. For some others, if the Series A round is small and only allows you to hire a small team, it could be after your Series B.
While I believe hiring an in-house recruiter at an early stage is a must, this doesn’t remove the need for founders and execs to stay involved and retain high level ownership of the function. Founders and execs need to become great recruiters themselves. They must understand what it takes to build and cultivate a pipeline of talent and contribute to building that pipeline. They should also spend time thinking of how to close the best talent and develop the company’s employment brand.
While it’s tough for a new founder to think of spending this much time away from other functions where their passions lie, more experienced founders and execs know the only way they can build a scalable business is to build a team of A-players that can do most of that work for them.
If you missed the first two posts in this series, you can find them here:
This post was originally published on forEntrepreneurs.com.
Follow us on Twitter: David Skok, @BostonVC and Matrix Partners, @Matrix Partners.
