# recruiting. [Apr'04] Recruiting is the single biggest determinant for success, with the people you hire literally being the DNA of the company. The challenge of recruiting is often under-appreciated by people who've never been responsible for it. First, you need to "sell" people on joining your venture, which isn't easy. Remember the old adage "good help is hard to fine"-- that's because smart, reliable, hard-working, no-nonsense people are never without work, so you have to lure them away. Here's some basic tips: (1) strategize: list reasons why people would join your venture instead of others, including reasons they wouldn't. Then, use this to source candidates. For example, when talking with recruiters, let them know these things. When considering how to source candidates, emphasize channels that tend to fit your criteria. (2) treat hiring like a project, including realistic schedules, budgets, risk analysis, contingency plans, etc. This avoids a lot of heartache when candidates ask for a lot more money, can't join when you need them, etc. (3) use pipeline management-- an ordered set of steps, with tracking of how candidates are getting through the process. You can optimize the pipeline by front-loading the steps that are most likely to filter-out candidates, and which are the least time-consuming. A proper pipeline also lets you optimize each step separately. For example, my first contact with a candidate is designed to be cheap-- usually an email with some basic information. I call candidates who express interest-- sadly, I haven't found a way to avoid these bazillion calls, since I don't like to pre-screen too much. (4) respect legal and ethical guidelines. Long before lawsuits or violence, hurt feelings are common in hiring. Since life is long, you may run into candidates in the future, where they remember your rejection. The world is a small place, so be careful of your reputation in the hiring process. Ditto this advice in day-to-day management after hiring. If you're recruiting for someone else, remember that you've built a relationship with the candidate, and should be available if problems arise. I like to check in from time to time. (5) tips for checking references. Of course, you check references, right? good. And you don't hand this to HR, right? good. They ask dumb questions like "how long did you work with X? what are X's strengths and weaknesses?" These questions have obvious "correct" answers, which neither avoids fraudelent references, nor elicits the issues that would lead to not hiring the person, much less provide information on how best to manage the person after they're on board-- which is the real value of reference checking IMHO. And HR won't impress the reference-giver, who will often talk with the candidate afterwards about their experience. Instead, you can chat up the reference-giver and impress them that (a) you know the candidate and can articulate why you're excited about working with the person, (b) your company and department are a great place to work and that (c) you'd be an awesome boss. Oh, and this is also an opportunity to source candidates for other positions. Some good reference checking questions:
- what project(s) did you and X work on? This detects fraudulent references, and also tells you how sharp the reference giver is, which IMHO is a good gauge of whether you should trust this reference-giver. Make sure the reference describes project(s) in enough detail.
- what was X's most shining moment? This helps gather stories, which you can then use to butter-up your management if you need to ask for deal-terms (e.g. money) that are outside your parameters. This question also butters-up the reference-giver for more difficult questions, such as...
- can you describe a situation in which X failed to deliver on his/her goals? Then followup with "how long did it take X to realize s/he wouldn't succeed?" and "how did X communicate this?" and "how did management react?" This detects "kicked-dog" syndrome, and lets you know what sorts of sensitivities the candidate might have, and how they might react in a politically-charged situation.
- can you describe an corporate culture or environment that X would NOT be successful in? You may have to push a little and pidgeonhole the reference who's intent on blowing sunshine. It helps to ask this before you describe your company, of course.
(6) interview tips. Obviously, respect is the key here. Don't show up late, take a phonecall or eat a burger during an interview. And treat every minute as precious and not recount stories from childhood. Don'y ask stupid HR questions like "describe your strengths and weaknesses"? when you could instead ask "what do you like about this position and why do you want it?". Don't ask a easy or trivial technical questions when you can instead ask deep, hard technical questions that detect junior vs. senior talent and detect incompetence. This is best phrased without acronyms or jargon. For example, my favorite question at Addamark for engineers was "managing big data-- say several terabytes-- is a big pain in the neck. Can you describe some of the challenges?" Junior people will talk about technical details, senior people will talk about fundamentals. Incompetent people will get those details wrong. There are a slew of miscellaneous tips I've found-- YMMV. (1) I try to schedule interviews for after lunch, say 2pm. This avoids wasting all day in a first interview, avoids taking candidates out to lunch, which empirically seems to hurt the hit rate (sorry, I have no explanation), and also uses the staff when they're least productive and most reasonable, i.e. while digesting burritos. (2) ask a person the range of cash compensation they want in the first phonecall, apologize for the awkwardness, and do it before saying anything about you want to offer. This avoids interviewing people you can't afford. Also, some people will name low-ball numbers which could either be a good or bad sign. If the number is in range, I tell the candidate up front, which puts people at ease and lets them focus on the job itself, rather than compensation. (3) stock compensation is messy because candidates either under-value or over-value the stuff, which creates deal-closing and post-deal management problems. (4) In an hour-long interview, I look for the candidate to tell me something (relevant to the job) that I didn't already know.
Arun Natarajan is the Editor of TSJ Media, which tracks venture capital activity in India and Indian-founded companies worldwide. View sample issues of TSJ Media's Venture Intelligence India newsletters and reports.