Can't Afford to Hire Great Talent? No Problem — Do This Instead From more vacation days to less meetings, there are lots of non-financial perks companies can offer to star candidates.
This story appears in the October 2022 issue of Entrepreneur. Subscribe »
Q: "I have a limited budget but big ambitions. How can I hire the best people?" — Kareen, Cleveland
"Everybody wants to hire the best. Very few actually pay them like they're the best."
This quote by AngelList founder Naval Ravikant might feel defeating, but it's actually a roadmap. If you want to hire great talent, then you need to think seriously about what you can offer them to join you — and then make changes accordingly.
Money isn't everything, but let's start there. Most small and medium-sized businesses don't offer enough incentives to their employees, and even big companies with deeper pockets have limitations where they can't provide the same upside. If you think you can't afford it, then step back and ask yourself: Do I have a hiring problem…or a budgeting problem?
Related: How to Attract and Retain Top Talent
For example, if you're spending on other assets that don't provide the same asymmetrical returns as an incredible teammate, it's time to make changes. Office space is a great example: Most businesses don't need a sizable office with a great location. I learned this myself years ago, long before the pandemic made remote work more common. I used to have two offices in downtown Denver, but they didn't do me a ton of good. Now I work from my basement, and I have higher-paid employees, a stronger business, and call billionaires and iconic athletes my clients.
Where else can you cut? Be ruthless, so long as you're making strategic, short-term cuts that can lead to long-term gains. This might include restructuring how you pay yourself. When I was ready to grow, for example, I made myself the lowest-paid employee on my team. My salary became dependent on year-end dividends based on profit. After all, if the people you add aren't leading to more bottom-line revenue, why are you hiring them in the first place?
Once you've maximized what you can pay, it's time to think about other ways to attract talent. You can double down on an unbeatable culture and the potential for larger returns, such as equity or bonuses. If you include equity, consider options with a longer exercise window, such as 10 years. And tie bonuses to individual and companywide success. Both are a sign of trust that shows you value their time and effort, even if they leave. That says a lot about you as a founder.
What about your vacation policy? Consider giving people more or even unlimited paid time off. Some leaders worry about this; they think their employees will slack off. But there's a simple solution to that: Hire the right people who won't abuse the policy! Good employees recharge; bad employees escape.
Related: How Companies are Offering Perks to Their Remote Workforce
Meetings — or lack thereof — are another way to win people over. Don't underestimate the importance of daily work-life balance. When you create policies to limit meeting times or have specific days for meetings, your team will work more efficiently and be less likely to bring work home. That makes them happier to keep working for you.
You can add additional incentives as well, like flexible work hours, educational stipends, and employee referral structures. These will demonstrate an investment in your employees and make clear that each person is an essential part of the business. When you're in the early days of hiring, you can even customize the incentives for each employee. During job interviews, just start asking potential employees what matters most to them — and then build that into your job offers. That'll give you an instant advantage over other employers.
If you make people a key part of why you exist and how you win, your team will become personally invested before they work a single day at your company. From there, you'll gain a reputation as a place the best talent wants to go to. And you'll all thrive together.
