Small Business Financing

Avoiding 5 Common Hiring Mistakes

Hiring the wrong person at a 5- or 10-person startup can be a disaster. Avoid these 5 common hiring mistakes.

Successful companies typically have a combination of talented people and great products. What many people fail to realize is just how important the talent portion of the equation is. While hiring the wrong person at IBM is not good, hiring the wrong person at a 10 person startup can be a disaster.    

Over the years I have been involved in hundreds of placements with startup companies and most find the process difficult. Below are the most common mistakes I see and how to avoid them.   

Mistake 1: Hiring Based on Past Performance

Don’t get me wrong. I think someone who has a successful past is worth considering. I just see some managers hire based on this quality alone. Selling $10M in software at IBM is great but hardly indicative of how this person will do at a small company with no brand recognition.


Drill down on the skills that have lead to this person’s success and ask yourself if those skills are what you are looking for. Will they transfer to a company like yours?

Mistake 2: Hire from the Competition

Hiring the right person from a competitor can be a smart move. However, many companies make the mistake of hiring an “average performer” simply because they come from the competition. You are better off getting a superstar with less industry knowledge than an average performer with industry knowledge.


Make sure you drill down on this person’s ability to perform the job you are hiring them for. Take out the fact that they know the industry and ask yourself if you would still hire them. Industry knowledge is worthless if the person is lazy!

Mistake 3: Rushing the Hiring Process

Let’s face it, going through hundreds of resumes, dealing with recruiters and interviewing people all day can be taxing. Hiring the wrong person, however, can be a NIGHTMARE!


Give yourself a reasonable amount of time for the interview process and make sure you meet at least 3-5 qualified candidates before making a decision. In this market there is plenty of talent, and you need to take advantage of this.

Mistake 4: Not Selling the Job

You have a great company story and assume everyone will want to work for you. WRONG. Even in a down market, the really good people (the type you need to hire) are being pursued by companies with equally interesting stories.


Make sure the people involved in the interview process realize the importance of “selling the job”. I cannot tell you how many times my clients have failed to sell the candidate they wanted and lost them to their competition.

Mistake 5: Looking for the Perfect Person

With the abundance of talent in today’s market, I see companies interviewing for 3-6 months before making a hire. They are searching for the PERFECT person and striving to eliminate the risk of a bad hire. Remember, no matter how thorough you are while interviewing, you won’t know if you hired the right person until they have been with the company for many months.


Find a middle ground between rushing and taking too much time. Spend more time interviewing for key positions and less time on the entry level ones. If you find someone that has 80% of what you need, HIRE them and move on.

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