The second installment in my series on going from 1 to 50 employees. I used this first tool of getting to revenue as fast as possible, and now I have some extra cash to hire employee number 2. What role should I hire?
The first role should be based on increasing revenue and product value, not on decreasing work for the founder. In fact, this trend should continue through the first 5 or 6 employees. Hire more people, generate more revenue. Rinse and repeat until the pressure for ancillary tasks becomes great enough that they can no longer legitimately be called ancillary tasks.Our first employee was a sales representative. But really she was more than that, she was another entrepreneurial oriented person who was ready to wear a lot of hats. She was ready to help refine our product and sales materials. But be aware, salespeople by definition change the product. So much so that I've got my own pithy saying about it:
"No product ever survives unscathed first contact with a person trying to sell it"
But how did I attract good talent without a lot of cash for compansation? Well, that brings us to our second tool in going from 1 to 50 employees:
Tool #2: Options and Environment. Finding and motivating employee #2 can be very challenging. Options help (though less so in the midwest). The right person for this role will be very interested in equity. The right option plan will provide long term incentive when cash is hard to come by. More importantly, the startup environment will be very attractive to the right person. Meeting in coffee shops, lots of responsibility, and flexibility in direction should inspire rather than frighten early employees.
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