Building a TA team for startups

Now that we have established a baseline in the previous article in this series let’s jump into the fun part. To start, we’re diving in and discussing the segment that sees the widest variety and changes within TA. Often, TA at companies with under 1000 full-time employees help shape the foundation and the relationship for years to come.

In this article we'll call out the unique differences between early and later stage startups and how the recruiting operations evolve as startups grow

A little about startups (<1000 FTE):

• Building an MVP (or multiple product streams): If the company is smaller (under 50), it is likely building the initial product and bringing it to market. If it is getting larger (plus 500), it is likely already working on multiple products.

• Determining product-market fit: For smaller companies, this is key for longevity and profitability. Bigger companies in this segment have likely determined the product-market fit of their original products and are looking for new industries to expand into.

• Establishing company culture and brand: This is the stage where a company’s DNA is built. As the company grows from a few to hundreds, there will naturally be shifts, and some people might not approve of those changes.

• Raising capital (or IPO): Depending on the company, this is where companies go from Seed/Angel investing to large series or even going public. Especially as companies get closer to the 1000 mark, not only do they start to think more and more about an IPO, but the employees do too.

• Generalist over Specialist: Especially at the beginning of a company’s development, new hires need to bring more experience across multiple areas than hyper-specialized experience. As the company grows, though, this shifts, as more specialization is necessary for continued success.

Navigating the challenges:

• Good habits, good process: When the word “process” is mentioned, especially in the startup space, nearly everyone shutters, thinking it means stifling creativity. Instead of focusing on rigid processes initially, focus on establishing good habits (e.g., timely scorecard submissions and structured interview questions). These habits will then help establish processes that feel more culturally aligned.  

• Establishing the why: Recruiting is more than just bringing people into a company. It is building a culture and is directly tied to its success. By helping your hiring teams and company establish the Why, you can better handle the ambiguity.

• Stakeholder management: Every company differs in how they hire and the type of individuals they hire. This means you will have to balance stakeholders, especially those who came from well-resourced or larger companies, navigate startup life where more creativity is necessary or, as the company is more established, startup to more corporate life.

What is the relationship between the company stage and TA?

Most companies and founders, especially when they first start out and before they have about 20 people, prioritize other elements of the company, like the building of an MVP and securing funding, over a dedicated Talent Acquisition resource. In previous years, this type of design made sense since founders generally recruited their first couple of hires from referrals or folks they previously worked with, but this is slowly changing. 

Repeat founders, especially those who had successful exits from their previous companies, realized that if they start with a recruiting resource, whether fractional or full-time, they find better talent and skills that they might not have discovered previously that can help them establish their company culture. Additionally, newer RecTech tools have made features (e.g., scheduling and data analytics) more accessible to those without a TA background.

Let’s say the company is hiring a fully dedicated TA resource at the very beginning (within the first 10 employees). Who are they hiring first: RecOps or Recruiter?

At this stage in the growth process, most founders and companies are looking for an ops-minded Recruiter. Why? Companies need a professional who can do it all over a perceived specialist because this individual will need to not only recruit, negotiate, and build the employer brand but also work closely with internal stakeholders to develop individual teams' recruiting strategies and strengthen the systems and processes. 

However, and this is starting to happen more and more, companies have realized that hiring a RecOps professional can have its benefits at this stage. For one, if the founders and early team members enjoy the recruiting process, then a RecOps professional can help ensure that the data is accurate and that the processes the teams are following are repeatable. 

Two, because RecOps professionals spend time in the tooling, they will work on getting the automation where it needs to be so it can be set and forgotten. Finally, the RecOps professional can also double over as People Ops, helping the company with full lifecycle recruitment.

Regardless of who the team picks, the goal will remain the same: to identify and hire the best talent at the right time. The desired outcome will also remain the same: high-quality candidates at a low cost of acquisition.

We hear a lot about “data-driven recruiting,” but that can mean different things to companies of different sizes. What are the similarities and differences between every company in the sub-1000 segment?

Having “data-driven” recruiting does mean a lot of different things. To some, it means keeping an eye on the Time to Fill and Time to Hire. To others, it means looking at the number of hours an interview team spends or the number of activities in a specific stage. 

Whether the company is just getting started or is a late-stage startup (~750 - 1000 FTE Headcount), what matters is whether they can use the data to tell a comprehensive story and make the necessary adjustments when needed. This is where TA can help. For example, every company in this segment cares about the cost of hiring (both in time and as a P&L line). 

Early on companies might turn to agencies to fill roles to hire quickly, which comes at a higher/more variable cost depending on the level of the role. An internal TA resource might fix these costs but not have the same specialized network, so might need more time to build those relationships. 

A company can use cost-per-hire metrics to help show the happy medium. Another example of using TA data to a company’s benefit is looking at the number of hours per hire paired with time in the stage. These two numbers will help show where process improvements can be made to prevent bottlenecks and drop-off.

There are two metrics that are easier to develop when the company is smaller: 1. Quality of hire, and 2. Diversity of your pipeline. Why? Because you can build them into the company's DNA rather than try to implement them later when you are likely to see more opposition. When it comes to QoH, one of the biggest challenges is that many companies opt to use subjective measurements over objective ones. 

Additionally, every department owns QoH, and it measures the company, not just the TA department. When it comes to looking at your pipeline diversity, normalizing the discussion to ensure you aren’t building a homogenous company needs to happen. The science shows that more diverse companies outperform homogeneous ones in nearly every statistical category. However, you risk heavy tokenization if you aren’t having the conversation early and often.

What TA tools should companies be looking to use at this stage?

We’ll break it down by size below:

Seed (0-19 FTE)

• A low-cost ATS or a self-built ATS

• Free scheduling tool to handle 1:1 interviews

• Job board subscriptions

  • Free ones can usually help get a company started.

Early Stage (20-500 FTE)

• An all-in-one ATS or an ATS that allows for multiple integrations

• A scheduling tool (if not part of the ATS)

  • A free or freemium scheduling tool can still be used here but as the complexity of interviews increases, you will likely want to explore a resource built for handling that complexity.  

• A transcription tool  (if not part of the ATS)

  • At the small size, this might not be necessary, but as the company grows, these types of tools can also help ensure your training programs are hitting their mark.

• A data platform and analytics tool (if not part of the ATS)

  • If you are looking to get more complex metrics or start to bring metrics together, having a tool (or someone with the skills to build and maintain analytics tools) is necessary

• Job board subscriptions

• Survey tool

Growth (500 - 750 FTE) and Late Stage (750 - 1000 FTE)

• An all-in-one ATS or an ATS that allows for multiple integrations

• A scheduling tool

  • A free or freemium scheduling tool can still be used here but as the complexity of interviews increases, you will likely want to explore a resource built for handling that complexity.  

• A texting automation tool

• A transcription tool  (if not part of the ATS)

• A data platform and analytics tool (if not part of the ATS)

• Job board subscriptions

• Survey tool (if not part of the ATS)

What programs should companies be thinking about building?

• Referral—Referral programs are often misunderstood but incredibly valuable. When done correctly, a referral program enables all employees to act as recruiters for the company, building a stronger pipeline of candidates. When done poorly, it leads to the homogeneity of the company and/or employees only making referrals for a possible incentive (usually a cash reward).

• Enablement—Initially, your Enablement program might be limited to live training like interview skills training (or programs). But starting a foundation, with documentation and possibly recordings, is important for the overall success and consistency of TA, allowing for quicker onboarding.

• Internship—Interns cannot only make key contributions to your company but developing a robust internship program can also help create a highly valuable early career candidate pipeline later.

• Internal mobility—It’s never too early to start building a culture of internal mobility at your company. You don't necessarily need to have formalized a built-out program by the time you hit the late stage or develop an 80/20 type program. But normalizing and socializing, early and often, that the opportunities are there and that all employees are part of the company and do not belong to the hiring manager is absolutely necessary.
  

• Employer branding—During a company's early stages, TA teams can sneak by with Canva and a style guide. However, building a strong relationship with the Marketing department can also yield results. Additionally, Marketing should be more heavily involved to ensure a consistent brand voice, especially regarding job descriptions and alignment with the release schedule.

Why do TA teams at this level start to become highly transactional versus strategic?

This isn’t always the case, but it all starts at the beginning of the TA relationship with other departments. As companies grow, TA can get pushed down the ladder, especially if a company hires a Chief People Officer or layers TA underneath another executive (e.g., the COO). 

As the TA team moves from out of executive meetings, its insights and influence can begin to wane because leaders no longer see the head of TA or recruiters outside of hiring meetings. So, what should TA teams do as the relationship changes?

In the past, many TA teams have opted to take the realignment and kept on recruiting. However, modern talent acquisition has evolved, and smart TA teams are able to use this to their advantage not just showing up with data but insights on how their work impacts the business.

By using the data they have to tie headcount goals to business goals, TA leaders and teams can approach business groups as partners, highlighting solutions not problems. Additionally, by using data effectively, TA can help companies save money in the form of ensuring they aren’t overhiring or building strong retention programs.

So what is needed by TA teams here to build strategic relationships?

1. Learn the language of the business group. Showing up and speaking the language of the business, demonstrates that the TA understands how the group talks.

2. Learn the data and insights that matter to the business groups. Each business group cares about hiring a little differently. Let's take the start date for a sales role as an example. The Sales team cares because it needs to get the rep onboarding and generating revenue. 
   
   Once they’ve found the person they want, they want them to start yesterday. But the HR team cares about when they start because they need to make sure everything is set up for the,m and Finance cares about the start date because it needs to it for business filings. The C-Suite might care because of board meetings and expectations. One simple date, but you can see how everyone cares about it. So how can TA help? By communicating the importance to all of these individual groups.

3. Continue building the relationship. Relationships become transactional when the only reason one group has to talk to another group is for one reason. Instead of allowing that to happen, continue to hold meetings with department heads where you show how TA can help their group even when no roles might be open at that time. Use this as an opportunity to help with strategic planning or talent assessments. 

AI and automation

In previous years, AI and automation tech for companies of this size was limited, usually by budget constraints. Because of this, TA folks generally got used to scrappiness and building many of the things they needed to operate at a high level of efficiency or using anything that was pre-built. However, this is all changing.

More modern solutions in the space, backed by better research and more widely shared information, have now made complex AI and automation available to TA folks at this level without the teams needing to spend extra. That doesn’t mean that TA professionals have lost  their scrappiness. It just means that solutions that previously helped them 2x their output can now help them 10x. 

Here are the top automations that people are using at this stage:

• Scheduling—Whether this is a separate tool or a pre-built one within a current tool, scheduling alone can save an entire company time and effort (especially in the early years when a company might not have hired its first TA person yet).

• Document sending—NDAs. Take Homes. If teams aren’t leveraging automation here, this is likely the biggest time vampire.

• Approvals—This can happen earlier as an industry requirement, but especially as companies enter their later stages and go international or public, approval threads revolve around offers and job openings.

What to expect next

As you can see, plenty happens from a talent perspective as a company starts to build. Catching, adapting, and correcting possible roadblocks now will help develop and establish a stronger culture as the company grows. In our next article, we’ll take a look into how that plays out and what companies between 1k-10k headcount start to evolve.