Category Archives: Hiring

Understanding Stock Options

Alex MacCaw has a great post in his blog titled An Engineer’s guide to Stock Options that describes in plain English all you need to know about stock options as a member of a startup team. It’s pretty well explained going from shares versus options, exercising your options, what questions you should ask before joining a company offering stock to employees, and more. 

Check the full post here:


How Important is Culture at a Startup

Charging for Coffee

I remember the day when a former senior executive from ATT came to talk to us at the MBA program and he had an interesting story. After a successful career at ATT he was asked to help turn around a struggling startup. They were bleeding money, had to cut their losses fast and either close shop or somehow convince the investors that there was a light at the end of the tunnel.

One of the first things he did when he arrived was to convene a town hall style meeting. All employees came to the cafeteria, and he and the senior managers stood in front of a microphone to take questions and communicate the coming changes. You could feel the stress in the air and cut the tension with a knife. The first question he was asked as about the vending machines. “What will happen to the vending machines” someone asked from the back. All eyes were on him. He knew that his answer would define him in the eyes of employees as a friend or foe. The CFO, next to him, was calm, she thought she knew the answer to the question. They talked before about the cost structure, where the money was going and what non-essential items would have to be cut. For the CFO this answer was a no-brainer.

“Right now, I don’t see a reason to remove or change anything related to the vending machines” he answered. The CFO almost choked as she looked at him with that “are you F… crazy?” look. But the employees were relieved and the rest of the meeting went well. In the eyes of the employees he was now OK.

What is Your Culture

Culture is not something you can buy, you have to build it slowly and consistently. Who you hire will help determine the type of culture of your company as will the policies, the benefits, and the perks you put in place.

Read more about startup culture and the right and wrong things to do in my recent post at Startup Grind titled Why Culture Matters, Even In Your Startup. I hope you enjoy!

What’s the Role of a Non-Tech Founder?

An interesting article popped up on Harvard Business Review Blog saying “Tech Startups Need Non-Techies to Succeed” which touches upon very important elements startup founders need to think about.

In today’s age where software development is all the rage, and having a tech co-founder is seen as a must, many forget that a great company is not built on the product alone, but rather on a combination of product, marketing, sales, and overall good business planning.

Consider the software industry, where we have successful brands like Windows and Oracle. While these two firms have world-class intellectual properties, I think their true innovation is in the pricing model around their businesses. – Ndubuisi Ekekwe

Yup, the author’s right. At every event or meetup I attend, there is always a handful of startup founders that are building great new social-mobile apps. How are you going to monetize? What is your pricing and distribution strategy? I ask… only to hear “oh, we’ll think about that later, after we raise some VC money”. OK, good luck in going down that path!

Who needs business co-founders?

According to the Startup Genome report, “business-heavy founding teams are 6.2x more likely to successfully scale with sales driven startups than with product centric startups”. This makes sense, and the report also points out that “balanced teams with one technical founder and one business founder raise 30% more money“.

The fact is, a well balanced founding team is key for success.

While a lot of attention in the software startup is paid to the technology stack, prototypes, and the like, movements such as the “lean startup”, and “customer development” are getting a lot of traction because they bring to technology founders the common business sense they sometimes lack.

Steve Blank‘s customer development process, which talks about the business model canvas, for example, is a typical exercise someone with an MBA would know instinctively. For a programmer, not so much.

Who’s in the team?

There are many views about who should be in the founding team. Dharmesh Shah,  co-founder of the successful VC-backed HubSpot argues that first comes the Developer, followed by a Designer, an Inbound Marketer, and a Sales person. Naval, from VentureHacks, has a post about the power of two, a developer and a sales guy.

Enterpreneur turned investor, Manu Kumar, once gave a talk at an event I attended where he laid out his view of the perfect team. He said the founding team should have the following skills: developer, designer, and business. It could all be part of one person’s skillset but this is hard to accomplish, usually there are two or three people representing these skills.

A similar question on Quora has elicited many responses, some similar to what I outlined above, some a bit different.

Some food for thought.

Understanding Visa Requirements for Startups

Adapted from Homeland Security by Phantamage @ flickrThis is a nice post from Chrisopher Golda on his blog, about Immigration Status for Startups.

He breaks it down into the best types of visas to get based on your role with the startup here in the United States, and explains why.

  • Founders  O-1TN or E-2 visas
  • Employees  O-1TN or H-1B visas
  • Interns  J-1 visa

Typical lawyers won’t be able to assist you with good visa advice, because it goes beyond the day-to-day incorporation, stock options agreements, and the like so doing some research and becoming aware of the different options you have as a Startup Founder or Employee is a good step to take. Worth checking out.

Finding Technical Co-Founders

This is probably one of the most asked questions of all, especially by non-tech founders (of course!). Yup, you have websites focused on posting startup jobs and others with the sole intent to help find tech co-founders. So why is the question still being asked?

Jason Freedman hit it spot on I think, with a blog post titled “Please, please stop asking how to find a technical co-founder“. You don’t have to go read the full post if you just focus on his simple advice:

You don’t find a technical cofounder, you earn one.

Jason, you nailed it.


Equity Compensation in Startups

All startup founders face this issue. You sit down at the computer and start Googling away helping you’ll find a clue about how much equity to give to an employee. Bootstrapped companies are the more interested in the answer since using equity is a great way to save some money and get people committed. Or is it? Many have tried to answer the question but it keeps coming back over and over again.

So here is  a short list of helpful resources that will hopefully serve as a guide to helping you figure this out.

I hope the above resources help in your search for the right compensation structure for your employees.