Apr 3rd, 2020
Fundraising is difficult especially when you are missing a hiring process! Understanding who you are and defining your process are critical in bringing confidence to your investors. It is NOT difficult to solidify a process! Bring confidence to your team and your investors by demonstrating that you understand the importance of getting the right people on the bus!
"You must have confidence in your competence." - Elijah Cummings
John is an energetic entrepreneur who jumped into the business world by investing in the agriculture, education, construction, and technology industries.
He is the former COO of Elektronet, a digital technologies provider similarly focused on the Smart Industry. With John’s involvement, Elektronet became the largest manufacturer and developer of custom hardware and software systems in the Middle East and North Africa. In 2017, he joined Juicebot as an executive board member and last year, he was made the Chief Executive Officer of Juicebot. He builds and models a great company culture while providing inspired leadership
Today we are going to discuss
- Why having a hiring process is critical in raising funding
- How build your hiring process into your capital raise
Why does Your Hiring process affects fund raising
- Investors invest in the people more than the idea itself. A great team will turn a great idea into a great product or a service.
- The technical people who build the product are the key.
- Experienced, key players with a stake in the company will significantly contribute to the business.
- Besides creating a great product, they will help the management in creating new revenue streams.
- Technical due diligence is becoming more important for the investors. Where your product is from a technical stand-point will define its success. Therefore, the investors are spending a considerable amount of time trying to understand the technology behind your product so they can help you with the product-market fit.
- Technology companies need great technical people who own up to the mission of the company. We need to build not only a great company culture but also an authentic engineering culture.
- This will give investors the confidence to fund the company as the alignment of business and technical is necessary to succeed.
Why was it important to bring technical talent first?
- Technical people (engineers, designers, developers) are actually turning the idea into a product. They own the design process.
- We need to connect them with all aspects of the business whether it is marketing, sales, or investor relations.
- We need to create a platform where transparency is key to getting things done. We can not and should not compartmentalize. All the stakeholders of the company need to be aligned on the mission and the vision. That can only be achieved by being transparent and sincere.
- Highest failure rate is after seed funding
- Pressure from investors
- Most critical hiring happens after raising seed round
- Critical to have a process at this point!
- Sloppiness kills talent attraction, without talent no future capital raise
How to build hiring process to attract funding. Where do we start?
We need to surround ourselves with effective advisory board members to bring in the expertise we may not have. For many entrepreneurs, the decision to involve outsiders in their business may be a wrenching step. Some simply do not want to dilute their control by establishing a board of directors with formal responsibilities and authority. However, the introduction of an advisory board can help some come to terms with this decision, by enabling an entrepreneur to feel comfortable with the business of providing information to, and accepting advice from, an external group.
- Get the message out there to get help from the startup community
- You need a lot of help. Networking at events, forums… ask for help
- Figure out what you don't know. Then reach out to people with the problems you are facing and allow them to join you when the time is right
- If people are not joining, take a step back and ask why?
- We need to be open to working with other people and be open to feedback and criticism.
- Not isolating people to their lanes. Letting everyone involved contribute at all levels.
- Outline your hiring process and timeline
- Phone screen, video/onsite interview, Decision/offer
- The future of your business is dependent on your hiring practices. Every new employee will either contribute positively to customer satisfaction, growth and profitability, or contrasting have a negative impact on the business.
- By adopting a structured and comprehensive hiring process, you’re taking the first step in positioning your business for success by attracting the right talent. The type of talent that will help build the company culture, drive sales and ultimately position the company as a leader in the industry. Failing to instill the right hiring process will do the exact opposite, resulting in under-performing employees and wasting resources, time and money.