How Tech Jobs Get Filled

Startups vs. Mid-sized Public Growth Leader

Jobs Series

It is important to understand how new jobs (or job requisitions) are created and filled. A lot of the literature available go into the generic steps of the process. You can turn to those articles, blogs, and video or podcast interviews.

For me, the materials already out there do nothing more than speak of the ideals. It makes sense. No CEO, HR person, or hiring executive wants to come off looking like anything but perfect. 

I will describe exactly what happens on the other side of the hiring process. Exceptions do not make a rule so keep in mind that what follows is a description of what I have been through. I have spent the last dozen years hiring like a crazy person. This happened due to the fact that my companies were early to mid-stage startups or a market-leading public technology company. 

For each of the sections (in BOLD), we will compare and contrast the startup against the mid-sized public company. For simplicity, we will call the startup Newco and the public company Leader. 

How Is A Job Created At A Newco?

Jobs at a Newco gets created ahead of revenues. During the venture funding process, the CEO has a slide that is marked as “Use of Proceeds.” This slide roughly reflects the headcount spend. A headcount will cost a Newco approximately $150k on average (the “all in” cost) through its Series A and B rounds. The early hires are normally expensive engineers so the average will decrease as time goes on. 

When a Newco enters “spend to grow” mode, the average will spike again as many executives are hired to run dedicated teams. You can imagine the headcount cost average looking like a U-shaped curve. 

The Newco spends almost the entirety of its money on headcount and capital expenditures. There is very little budget for program spending. This is why overhead positions do not get created early on. Of the first 20 hires, 15 may be for engineering and operations, 3 will be general/administrative, and 2 will be sales or business development. The first marketing hires will go into the G/A bucket while the product manager will go into the engineering line (even if they report to the CEO).

How Is A Job Created At Leader?

Jobs at a Leader often get created behind revenues. For example, a VP of marketing will submit a request for headcount. The CFO works with the CEO to prioritize areas of the business. And, based on the quarterly results and forecast, allocate budget to various functional departments and/or business units. 

It may seem well thought out (to be variable) but, in reality, over the course of several years an executive can predict how many new jobs they will be able to fill. It is normally around 10 percent of the total team headcount including backfills - or replacements. 

There is some misconception out in the market that Newco spends a lot less on people than a market-leading growth company. This is not true in my personal experience across almost 10 companies. The top marketing executive at a Leader will indeed pull down well over $500+ in salary, bonus, and stocks.

Named executives pull down more than $1M+ easily. And, the Newco counterpart will average $250-350k not including the value of their ISO allotment (which is normally 1-2% of total outstanding shares). 

But, all the other jobs are much more comparable than people believe. This happened due to the many benchmarking services and databases that are now easily affordable to obtain. Newcos cannot lowball top talent anymore as they once did back in the 1990s and early 2000s. 

Hiring Process At Newco

How jobs are created has a lot of influence over the process of recruitment, candidate interviews, and offers. This is why I went to the trouble of explaining how the job reqs are created above.

The Newco hiring process is very much owned and driven by the hiring manager or executive. I paid very little attention to the hiring process. The HR person or team we had at the various Newcos did not have separate “HR” goals. Their only mission in life was to help me hire the best possible talent out there.

The process -- if we can call it that -- was all over the map and chaotic. I would say that candidates hit my inbox from one of three sources: resumes from HR, referrals from colleagues and VCs on our Board of Directors, and through my professional network.

We read about the enormous volume of resumes Google receives each week. A typical newly VC funded newco suffers from the opposite. We do not get enough resumes. There is a lot of junk resumes that HR filters out or the hiring executive ignores. 

I would say that getting 3 or 4 well-screened resumes per week is closer to the norm. If the HR team kept sending me misses, I would just walk over to them and clarify why the candidates are not the right fit. It would be a 2-3 minutes hallway conversation. 

Once 3-4 top candidates are identified through a 45-60 minute phone interview by the hiring manager, HR works with the candidates to bring them in for a half-day of face to face interviews. At Newco, most of the work is on development or engineering so we rarely dealt with key people being out or on the road. But, yes, the interview can be multiple days.

The CEO and founders are part of the decision making team. I do not recall hiring a Director-level talent without getting the unanimous buy-in from the CEO and founders. Cultural fit is far and away the most critical factor in hiring the first 30-50 people.

If you are interviewing with a Newco, research the leadership team intently and make sure that it is obvious to them that you have studied their company and space. The goal is not to show that you are passionate about Newco. You need to study the space because a lot of the interview itself will center around ideas you may have about the function. And, hiring executives do not get impressed with generic book-learned answers. 

To close, the Newco hiring process is very much a top-down exercise. The key decision-maker is often the tandem of the hiring executive and the CEO. If there are multiple founders, they each have a veto to any department’s hiring decision. The HR team is a facilitator and any future teammate in the function for which you are applying is normally agreeable and (dare I say it) passive. 

A word about the peer(s) who may be a part of the interview process at the Newco. They are relieved that more help is coming. They are not threatened or worried that their importance or role will be potentially reduced.

It is from this positive place that their agreeable attitude is sourced out of. If a candidate is a “no go” for them, they will also veto strongly. But, in general, the hiring executive will need to help position the candidate upward - to the CEO and other executives. 

Hiring Process At Leader

The key difference at Leader (public, mid-sized market leader) is that the hiring department and the HR department are business partners. Every hiring decision reflects on the goals of two teams. In all the companies I served as a senior executive, we had one or multiple HR partners attached to my hip. 

In a global tech company, I had a dedicated senior HR partner on four continents. This is important to know as you figure out how to navigate such an organization. The HR partners are often generalists who serve more than one functional team. And, they have a strict process that hiring managers need to follow.

Further, these HR teams have a vast network of inside and outside recruiters, several paid job candidate sourcing services, and a limitless database of past and current candidates. No matter what these HR people tell you in nicely worded articles, do not believe at least half of what you are being told.

The HR partner typically wants to fill the role as quickly as possible and move on to the next one. They are working under a scorecard and the velocity of filling reqs is one of many measures. If they claim they have no such metrics, they are either (a) lying or (b) incompetent and should be fired. The hiring executive at Leader is also working with a fast schedule. So, the (S)VP and HR are aligned in this regard.

However, the vast majority of jobs are opened and filled by middle managers and junior executives. The head of the department allocates its departmental headcount down to the direct reports. Once the headcount is opened at the mid-level (local, regional), the speed or urgency of filling the newly opened position varies wildly.

Most commonly, roles that influence revenues directly (frontline field jobs and field support roles) get filled very quickly. The repeatable process is in place and the company has a well-tested model for operating so they do not nitpick when making offers. The HR team has undue influence in filling these types of “mission-critical” roles. 

For jobs that are created by slower headcount growth areas (e.g., marketing, HR, finance, etc.), the hiring executive or manager retains a lot of power even in large(r) companies. The HR team is a supportive facilitator throughout the process. Weird things can happen when a process is adhered to. It is not unusual for the process to take many weeks or even more than a month. 

Unlike the newco, the future peers the candidate will work alongside have a big voice in the decision. As you can imagine, teammates huddle among themselves and often collude on who they liked or disliked. This makes the hiring manager’s job unnecessarily difficult.

A highly experienced manager will factor in all of this when opening up a new job req. A big part of making a decision as a manager is persuading others and the hiring process is no exception. 

Getting hired at Leader is far tougher than getting hired by a Newco. It is almost like throwing darts while blindfolded. And, you still have the completely unpredictable human factor to navigate through. Unlike the newco, the future peers who are interviewing you are often threatened.

Many view the new hire as an attack on their job security and comfortable station in life. I have seen some weird dysfunctional stuff at mid-sized, growth companies. 

Thus, you have to make it out of the database lottery + survive the dysfunctional dynamic of the interview process + standout among the final 2 or 3 candidates. Large(r) companies always have backup candidates. I always had a list of 3 or 4 final candidates as things frequently fall apart.

The types of candidates who apply to large companies are often interviewing at multiple companies. They also tend to be passive talent so they may just decide to stay at their current job.

Closing Thoughts

For Newco, remember that the hiring manager, CEO, and founders are critical decision-makers. The HR person you will interact with the most is friendly. The future colleagues who the hiring manager includes in the interview rounds are also friendlies. Your approach should be to be strong, memorable, and borderline aggressive.

I do not mean aggressive as in personality. By aggressive, you want the people who met with you to think to themselves, “Wow, this person overprepared by 10x and I could feel the temperature in the room rise by several degrees.”

Whip-smart. Very aggressive. Really ambitious. Extremely thoughtful. Those are the words they will use to describe the top candidate behind closed doors when debriefing.

For the Leader company, the hiring executive is a conductor and coordinator as much as a decision-maker. You have to understand that the HR people are as influential as the hiring manager. You have to win their trust and impress them. Also, the peers you meet with are looking for signs to be comforted by your addition.

The message you want to send them is almost exactly the opposite of the Newco peer group. Collaboration. Teamwork. Balanced. Calmed. Measured. All those types of words are what they want to elicit when describing how their interaction with you went. 

I hope that if you got anything out of this article it is this …

People have obvious motivations and hidden motivations. Understanding both will help you tailor your approach to maximize your chances of success. For example, you may have gone into a large company for interviews and behaved like the alpha dog to impress a top executive. The job offer never came. Now, you know why. 

The people who work under that executive were put off or threatened by your approach. And, the executive with the fancy title deferred to her team a lot more than you anticipated. After all, she has to prioritize team cohesion above almost all else when dealing with a steady growth organization.

Or, you may have gone into a job interview with the Newco (startup) with the wrong approach. They wanted to see the intense side of you but all you displayed was your bland but safe self.

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