How to hire well

August 23, 2024 Ryan Vaughn

In the process of scaling a company from 10-100 employees, there are a number of very practical practices I review regularly with founders. Each time I find myself having a conversation multiple times, I write an essay about it to provide a reference for clients as they navigate their own situations.

How to delegate, how to structure your day as CEO, how to run a VC fundraising process, and more are all examples of this process.

Today, I want to discuss the latest example: how to hire well.

How to hire well

“I’m just not sure if she’s up to it,” the founder said, slumping in his chair. “She works hard, she’s reliable, but since we promoted her to Head of Growth, the results just haven’t been there. I’m not sure if she’s going to be able to figure it out.”

I grimaced. “Sounds like some part of you is already questioning whether she’s the right fit for this new role.”

“I’m not sure,” he said. “It’ll set us back if I have to let her go and hire someone else, so I want to give her another month or two. If she hasn’t turned things around by then, we’ll make a move.”

I’ve had some version of this conversation dozens of times and have seen the pressure that CEOs feel in this situation.

Conventional CEO wisdom suggests that when a CEO has doubts about someone, it’s best to pull the trigger and let them go. And I’ve said before that my rule of thumb is to let someone go the second time you think you ought to, because the first time can be emotional, but the third time is usually stalling.

Often making the hard call to move on is better than holding on and crossing your fingers, even though a knee-jerk change can create its own problems as now there’s a vacuum that must be filled, and a great deal of pressure to do so quickly.

Either way, CEOS can find themselves making vital, one-way decisions about certain roles, and the human beings occupying those roles, decisions that deserve a great deal of analysis and rigor, based almost entirely on gut and emotional predisposition.

Yuck.

So how do you get ahead of this pickle?

You invest in building your team WAY before you need it.

ABR – Always Be Recruiting

Most founders I meet wait until they feel some sort of pain to begin the recruiting process for a new role, or they wait until they’ve let go of a current employee to begin recruiting a potential replacement. That’s a great, super logical way to lower your batting percentage for hires by ensuring you always make hires under pressure and with limited information.

Here’s the common process and its result:

Need > Recruit > Hire = shitty results

The best founders, on the other hand, are proactive about their team building. And by using two simple tools, they completely change their hiring process and, most importantly, improve their results.

Here’s the ideal hiring process and its result:

Recruit > Need > Hire = better results

Those two simple tools? Informational Interviews and The Bench.

Clarify your vision for each role through informational interviews

When you don’t know what excellence looks like in the role you’re hiring (or the role you’re considering replacing), you can’t hire the best people. A prerequisite for hiring someone truly world class at any role is knowing how to identify world class in that specific role.

If you don’t know what world class looks like, you end up thinking long and hard about a role, choose whoever seems like the best available person (key word “available”), and cross your fingers. But unless you get incredibly lucky, you will inevitably settle. At best, you’ll hire someone who is good at the things you understand about the role, and a wild card at the things you don’t. At worst, you’ll hire someone you mistakenly think is great but who will actually lead you way off course (plus, once you’ve inadvertently hired a C player into a leadership role, they can’t help but surround themselves with more C players). These are the people who don’t work out, but you keep extending them more and more rope because it just seems like they should be a fit.

Many founders, long conditioned to simply figure shit out as they go, fall naturally into this pattern of hiring because they think they can simply figure shit out regarding high level hiring the same way. But high level hiring is too important to wing. Much better to humbly recognize that, unless you’ve already been a world class (CFO/CRO/COO/CTO/etc) before, or worked with one, you almost certainly do not know what great looks like in that role.

That’s a problem. So before hiring, solve for learning what great looks like. The best method for this is through informational interviews.

When you’ve identified a key role that you’ll need to fill in the future (before the need is immediate), it’s important to begin a process of intentionally meeting people who are world class in that role and asking them to help you understand what great looks like. Have a few of these conversations, and you’ll be able to triangulate fairly accurately the characteristics and thought patterns of the best in the industry. This will add data to the hard decisions about whether your current employee is actually as good as you think she is and will enable you to choose better candidates for future hires.

For example, if you’re hiring for a VP Engineering role, you’ll begin your process by reaching out to world class VP Engineerings (targeting companies you admire, companies in non-competitive industries, and even sometimes competitive companies) and asking to interview them. Not for the job but simply to help you better calibrate how the best VPs of engineering see the world—and to figure for yourself how to discern the difference between competence and excellence.

Most functional leaders in organizations are happy to help out in this way—flattery is powerful—but it’s surprising to me how few CEOs take advantage of this. As a result, many people have no idea whether the person they’ve hired is an A, B, C player or worse until months or quarters pass, and they begin to miss their goals.

Informational interviews aren’t rocket science. But they are hella powerful. And, they serve another purpose as well:

They enable you to build your Bench

When you don’t have a bench of qualified candidates before you need them, you can’t help but settle for the best of what’s available when you do. So even when you do hire well, your hiring process begins when you’ve identified the need and drags on well beyond the optimal hiring timeline.

But once you have developed clarity on which are the most important roles in your company over the next 6-12 months, you can start meeting people who are world class in those roles via informational interviews. And in addition to helping you hone your instincts on “what great looks like,” this also enables you to strategically broaden your network inside each role, without the pressure of needing to make a hire immediately.

This is called building your bench.

Through these conversations, you’ll naturally develop a list of candidates for each of these important roles over time. Folks who you want to work with at some point but don’t yet have a place for, and folks who know you and are already positively inclined. This bench ensures that when the role does become available, you’ll already have a handful of vetted candidates from whom to choose, which makes the whole recruiting process much faster, and increases your batting percentage of great hires.

This bench can also be put to immediate use in mentorship roles. One of the most powerful things you can do for junior employees with potential is to introduce them to a world-class operator in their role who may take an interest in them. Help them nurture that relationship and watch their development accelerate.

But shouldn’t I be spending my time on more immediate things?

It’s easy to think you don’t have time to invest in these types of non-immediate relationships. And pre-product/market fit, when your hair is on fire all the time, you may not. But your team is the greatest point of leverage in your company, so as you grow it’s worth carving out time to plan ahead and make sure you get the big roles right. As hiring is the single greatest point of leverage for a CEO, I encourage you to look at this as the first step toward shifting from Founder mode (do more, faster), to CEO mode (do less, better).

This is equally true after making a hire. It’s natural to think that once you’ve made a hire you can stop thinking about that role. Again, for most roles, that’s true. But for the most important ones, it’s important to maintain and even build your bench of candidates even after hiring someone, for the same reasons. Things change, and more than any other responsibility besides keeping cash in the bank, it’s incumbent on you to ensure that you build the best possible team despite those changes.

Nothing slows you down more than a bad hire that lingers.

Every leader has worked with an employee who, for one reason or another, isn’t performing well. It’s an agonizing situation for everyone involved, whether it’s a personnel issue or something to do with the circumstances into which the company has placed them. Most CEOs fear making a move too soon lest they make the wrong one and the company suffers, but then they’re relieved when they finally do do something. Until they have to quickly spin up a recruiting process from scratch to get someone in that seat in 90 days.

It doesn’t have to be such a fire drill.

With intentional planning using these two simple tools, hiring for the most important roles becomes a steady, progressive process of building your vision and your network. With a strong, informed vision for the role, and a bench of passive candidates nurtured over time, it’s easy to benchmark an underperforming employee, and either support, layer, or replace them quickly and with confidence.

Want to dive deeper?

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