The number one thing I look for when hiring is ‘makers angst’.
More than just startup experience, makers angst is the lived experience of trying to build a product or company. It’s the combined highs and lows, stress, reflection, learning, and adapting on the fly that can only come from experience. And I consider it one of the lead indicators of whether someone will be successful in a paid audition and then, if successful at that stage, as a full-time team member.
I look for makers angst because the number one misconception about startups is that they are training grounds. For those recently graduated from school or university or transitioning from a different career.
Startups are not training grounds.
They are intense, cash poor, high-risk and fluid environments.
In other words, the time and space to coach, train and formally develop people simply doesn’t exist in the same way it might in more mature organisations.
It’s a harsh message, but it’s true.
And a fair rebuttal would be that you often hear me evangelise that a high rate of learning is a secret weapon for founders and their ventures.
That rate, however, depends on two factors. First, a base level of competence in a functional area, like product management, marketing, sales or science or engineering. Second, a demonstrated ability to create momentum from a standing start. And more importantly, within a month of joining a new venture.
Of course, the irony for most founders is that finding people who they can afford who fit this bill is difficult. And while founders are constantly battling trade-offs, the one factor that should be traded off the least is the quality of talent joining your team.
Hiring mistakes that we all make remind us of this. They might cost money or cause a short term hit to the venture’s reputation. But the most significant negative impact, which is also the most difficult to recover from, is the stalling of precious momentum that comes from hiring the wrong people.
The first interaction I have with a potential new hire is often in response to a job ad, a referral from a trusted source, a tweet or a LinkedIn message. Before I respond, I scan their LinkedIn profile looking for signs of makers angst. I’m looking to see if they have founded a venture, been an intrapreneur, or been one of the first five or ten hires at a startup?
If they have, and there is some detail about that chapter online, they can be assured that the first part of our conversation will focus on that period, what they learned and how it shaped them as a person.
The same is true if they haven’t listed details online, but the referring party has mentioned that part of their history as the reason for the referral.
My theory is that people with this type of experience, having experienced makers angst, are more likely to bring perspective and a different approach to problem-solving in chaotic environments that those who are new to startups. When this theory plays out to be true, these people also tend to consistently live up to the value of ‘acting like an owner’. Because they have felt what it’s like to be the owner before, and this is incredibly valuable.
But what about my opportunity cost?
The opportunity cost of me joining your venture is very high. I could be earning a lot more elsewhere.
I have heard this argument made many times. It’s usually posed by people without startup experience who are trying to convince the founder of their worth and instil a sense of FOMO (fear of missing out).
This kind of argument is a red flag for two reasons. First, the person making the argument hasn’t realised how value is generated in a startup. Sacrifices are made every day by the team in the spirit of achieving a startup’s vision. If one person is focused on their opportunity cost, then there is a good chance they will undervalue the contributions of other team members if they are hired.
Second, and I think this is more important, opportunity cost goes both ways. The opportunity cost of a startup employing someone means they can’t deploy that capital to other things. And while that might sound obvious, founders have a habit of achieving a lot with a little. I could pay $50K per annum for someone with limited experience.
They might be able to achieve some parts of some tasks and learn a massive amount along the way. Or I could hire freelancers to help me execute more efficiently. I know it’s not that binary because the 50K hire could end up developing into a valuable team member.
But the point is that founders have the choice.
When faced with hiring decisions, it is essential to consider the opportunity cost and how else that capital can be deployed. I often think about the opportunity cost in terms of software engineering time. In other words, how many hours of a software engineer’s time could be used to build a product if I didn’t spend money on the alternative?
My friend Gautam Mishra taught me this, and I use it a lot.
Makers angst starts with making
This post and philosophy are not about a hiring policy that screens out people without startup experience. My message is that to be effective in a startup, you need to have felt the discomfort and exhilaration that comes with making a product or service. Education and non-startup work experience in and of itself will not make you productive.
You need to have tried to make something. So do that.
Use the many free resources online, like my blog and podcast, to create a side hustle.
Learn to validate an idea in 30 days.
Be able to talk to this direct experience.
It will prove you can get (back) on the tools, learn and be humbled by the experience. More importantly, and for those who come from senior roles in government or corporate organisations, it will help prove to the founders that you can bring real value to their business.
Like many founders, I am wary of senior managers who want to make the transition to startup for the first time. They may bring a host of relationships that they think they can be leveraged, which can be helpful. But since moving off their early career tools and transitioning into management, these candidates often develop and over-value their capability to manage priorities and navigate politics. While managing time and priorities is essential in a startup, managing politics is not.
One last thing…
If you want to join a startup, prove that you have attempted to make a product or service. Be ready to tell that story, especially if it failed. This experience will help you see around corners in chaotic startup environments and start adding real value quickly.
And if you are a founder or employee of a failed startup, understand that your experience is immensely valuable. You hold the cards when it comes to makers angst. Put them to good use as a mentor of mine says, ‘confound the critics and build a great company’.