Hiring First Set of Employees

Hiring your first few employees is no less terrifying than meeting a girl in the arranged marriage set up, as one wrong person can ruin the entire culture and foundation of the company; but if taken a few steps wisely, one can avoid the disaster.

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By Anuradha Pundir • Sep 22, 2018

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You ventured into a start-up and after a lot of hard work reached a point wherein managing work alone seems to be impossible. It's that fortunate time when success appears to take its first leap but is also one of the most critical moments that can make or break the business. It has been seen that the first few hires create the backbone of the company; it sets the tone of the company's ethics and culture, and if gone wrong, can jeopardise the future of the business.

According to the data available, the average recruitment cost for small to mid-sized companies is Rs. 25,500/- in India, which is also the average monthly salary of an employee in the country. Moreover, new employees need 8-26 weeks to get up-to-speed, hence the lost productivity costs the company a substantial amount. As a start-up founder with limited resources, it's imperative to spend every penny wisely and take charge of the hiring process judiciously. Here are a few points that can be helpful in taking this big decision:

Personal Assessment

It's important to asses if you really need to hire at this juncture, as hiring too early may unnecessarily add to the cost and leave good people with not enough work to do. Similarly, hiring too late may hamper the growth of the company and you may miss the bus in this ever competitive world. Do consider if you have enough work for the person to do for at least the next three to six months.

Understanding Legal requirements

You need to understand your legal obligations as an employer while hiring. Some things to think about include employment laws, employment contracts, tax obligations, the implications of firing the employee, minimum hour and wage requirements, overtime stipulations etc. Spend some time to research on employee policies and understand if you would be able to adhere to them at this stage.

Check for applicant's interests

Not everyone does the job out of passion, but for a start-up, whether the candidate's interests align with the job profile and company's goals or not must be a top priority for the employer. Abhishek Agarwal, Senior Vice President, The Judge Group India believes, "Most of the people seek jobs in which they have no interest lured by only high compensation packages. Such employees are neither productive at work, nor they contribute to the organizational growth. Therefore, you should ask about their interests beforehand so that you hire only the ones who are passionate about the job as much as you are for the business." A clear conversation during the interview can be helpful to find the interest of the candidate.


It's important to have aclarity of the first few tasks that need to be addressed and bring diversity into play. Hiring the first set of employees should be driven by the business plan and the first areas you plan to embark in the business, advocates Purvi Sheth, CEO, Shilputsi Consultants, a Management Consulting Firm. "Focus on what you need to get done in phase 1 of your plan. Don't start recruiting for areas you as an entrepreneur are most familiar with or those that seem most exciting. A typical mistake is to bring people who are similar to yourself. So, bring diverse skills first," she said.


For any start-up business unlearning is one of the most important factors looked upon in the employees these days. Every startup is different and unlearning is as important a part of it as learning, Siddharth Upadhyaya, Chief Strategy Officer, OurHealthMate believes. "Wherever possible select young fresh talent who are eager to learn and have little to unlearn. In case of selecting experienced professionals, it's always better to select someone who is open to drastic changes and deals with ambiguity positively. Sometimes experienced, specialised professionals who have been in very structured environments throughout their careers find it difficult to contribute in a start-up due to the unstructured nature and "learn as you go' attitude of the organisations," he said.

Look for adversity quotient

When looking for the first set of people, don't go with people who come from "brand names" or those who have worked only with large companies. Working for a start-up requires the ability to take rejection and manage with limited resources without the comfort of big names to leverage. Purvi suggests, "Look for those employees who have worked in other start-ups, smaller businesses or even had some failures in their career so they have developed the ability to take a few disappointments and breakdowns." A personality that can handle difficulties is extremely important in start-ups.


Salary structures which are usually very well organised in the well-established companies are usually happed hazardously created in a start-up, and that brings a lot of trouble in the future. Throwing light upon the salary structure, Siddharth added, "It is important to fix salary bands for every role and stick to it. Consider statutory benefits as a part of CTC for every individual irrespective of it is deducted or not as it will not create any extra burden in the future."

While hiring your first set of employees is always a perplexing and cumbersome task, some research, your gut feeling, belief in yourself and the candidate can lead to a good hiring decision. So go ahead, take a deep breath and make your first hire fast.

Anuradha Pundir


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