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5 Reasons Why Hiring Is the Single Most Important Skill for Founders If you don't know how to make the best hiring decisions, you will not have the best company.

By Moritz Plassnig Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.


The longer I'm involved with Codeship, the company I co-founded, and the more entrepreneurs I mentor, the more I'm convinced that people and a great team are the lifeblood of a fast-growing startup. I would even go so far as to say that people are the foundation of every organization, big or small, high-tech startup or huge corporate juggernaut.

But the startup world is unique in its constraints and also in its opportunities and thus, the emphasis on building a great team is more important at a startup than in any other organization.

Related: Why You Need to Avoid Hiring That Potentially Toxic Rockstar

There's no such thing as overnight success, as much as countless books and movies try to portray well-known entrepreneurs as geniuses. Success is the product of a variety of factors, hard work as much as great and unique skills, the perfect timing and elements outside your control such as luck.

The more you as a founder, CEO or leader can remove the latter from the equation, the better off you and your team will be. Building a great culture, hiring skilled individuals and forming an amazing team allow you to make your own luck. It's a lot of hard work-- but it's within your control.

1. Investors invest in people, not ideas.

As much as you like your idea and believe that the market conditions are perfect, the truth is that most companies will change and adapt their product down the road. The founding vision of Slack was to build a game, Instagram started out as a Foursquare-like check-in app called "Burbn' and everyone knows the story of Twitter being a side-product of a podcast platform.

What all those companies had in common was a strong team that was able to take fresh ideas and build new products until they became the success they are today. The people working at those companies were able to adapt, change and build a great product. Maybe your company won't pivot completely, but you will learn, adapt and improve as you gather feedback from your customers. And the more feedback you incorporate, the better you get.

The ability to do that, to listen to the small feedback between the lines, knowing when to stay stubborn and when to adapt is one of the most important and hardest skills to learn for a founder. Great investors -- angels and venture capitalists (VCs) know that and, despite the importance of a potential big market or a significant enough problem to be solved, the team is the key reason why they will eventually invest.

2. Early on, every hire is crucial.

Summarizing a successful startup in one sentence is simple: Great people build great products, get great customers and eventually build a great company. As simple as it sounds, doing it right is incredibly difficult. You will face a lot of challenges during the early days, and the more successful you are, the bigger your team gets, the harder it will be to keep your team members aligned and your company on track.

The one thing to keep in mind at the end of the day is that everything good or bad is caused by the people in your team. Empowering your team and getting out of the way is key, but it's only possible if you hire the right people.

Small companies don't have the luxury of making a lot of mistakes. You are always resource-constrained -- both money and people -- and despite not having enough, you have to build a great product, nail the distribution and find a viable business model. This can all work out great if you did your job well and found great co-workers -- but it can also go sideways instantly if you did a poor job.

Nothing is more dangerous for an early-stage startup than one bad hire, one person who isn't a culture fit or is simply not good enough at their job. Even if you resolve the situation fast, you will get distracted, probably won't build a great product and lose a lot of time. Bad hiring is one of the most risky and costly mistakes you can make at a startup.

3. Great people attract great people.

Nothing is more attractive for a talented job seeker than a team of highly skilled co-workers. Despite all the potential problems that arise with hiring, there is a huge upside if you do it right. With every great person that joins your team, the team gets better, and it will also get easier to attract the next person.

Hiring is a self-fulfilling prophecy -- and it gets simpler over time. The hard part obviously is to get everything started. How do you hire the first employee if you don't have an amazing team that everybody is talking about?

Solving this chicken-egg problem is crucial for getting your company off the ground. The good news is that you already have a team, even before your first hire. You and your co-founder(s) are already a team -- which is one in a long list of reasons why you shouldn't start a company alone.

You find your first follower, and you've already taken the hard first step. Maybe, you even managed to get a small investment or convinced somebody to be your advisor. You will have a team long before hiring that first employee, even if it doesn't feel like it.

Related: 3 Benefits of a Better Thought-Out Hiring Process

4. Culture is more than the sum of every team member.

Even if you hire only smart individuals, despite their respective skill sets you won't automatically create a high-performing team. Great teams are generally a group of amazing individuals mixed together in the right way. The glue between the outstanding senior engineer and the young up-and-coming designer and the magic that makes sales work well with product is having the right culture.

Culture is not about free food, nice Christmas parties or other perks. It's about shared values and beliefs, the common ground of every discussion and the bigger reason why you are all working on the same idea. Great culture makes you win, great culture will help tremendously to survive tough times. Having a great culture will simply make you feel that it is easy to build a successful company.

The importance of culture heavily impacts your hiring. Every single person you bring on in the early days changes your culture, in a good or bad way. Figuring out if somebody is a culture fit or if somebody is the right person for your team is crucial. Although culture is defined by your team, by every single individual, you still have to work hard -- and you won't get it automatically by hiring right.

Your job as a leader is to facilitate discussions, offer a vision and set the guard rails. Nothing defines culture more than actions, and your team can't do it right unless you provide the guidance they need.

5. Hiring is a skill -- and it should be your most important one.

Hiring is not magic, and it's not luck -- it's a skill. Some people are better at it from their first job on, others not. Maybe you are, but if not, you can learn, and even if you do it well right now -- you should still work hard every day to improve.

The faster you figure out if somebody fits into your team and the quicker you can evaluate the skills of an applicant, the better it is for you and your company. The better you are at convincing people to join your team and in selling your vision, the better they eventually work for you.

It's important to understand that it's not just about you interviewing a candidate. You have to design a hiring process that involves your team and gives the candidate a lot of opportunity to evaluate you as well. Every growing company faces the same challenges, and you can learn a lot from the best practices of the industry, from companies that did a great job with hiring and also from companies who failed.

Luckily, now more than ever, startups are willing to share their journey starting with small insights and some tactical advice as far as being completely transparent like Buffer. Take the opportunity, and learn from those companies and their failures and successes.

Don't forget that you are always hiring. It doesn't matter if you are conducting a job interview in the office or if you are at a friend's party. You are always leaving an impression, whether you want to or not. Maybe you aren't looking for anybody right now, but you surely will in the future or at your next job or company.

Making sure that you always have a big pool of great people to work with will set you up for victory. And since it's all about the people, it will make the difference between success and failure. Always be hiring.

Related: Does Your Organization Make a Great First Impression?

Moritz Plassnig

Co-founder and CEO of Codeship

Moritz Plassnig is the co-founder and CEO of Codeship, a developer-tool company with offices in Boston, Mass. and Vienna, Austria. Moritz founded Codeship together with Florian Motlik and Manuel Weiss in 2011.

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