How to Staff a Strong Culture on a Shoestring Budget

Founding a successful startup is one of the hardest things an entrepreneur can do. Money is tight, talent is limited and competition is fierce. Time is money. It can be a vicious cycle, which explains why more than 50 percent of startups fail within four years.

So, what does it take to survive?

The right people.

Investors invest in people. Products don’t make or deploy themselves. Customers expect human contact. Awesome people attract other awesome people. And an unhealthy work culture will become your startup’s most costly mistake. Turnover costs roughly 50 percent of an entry-level employee’s salary, 125 percent of a mid-level employee’s salary, and as much as 200 percent of a senior executive’s salary, according to Forbes.

Here are the top lessons I learned while starting up my own business, along with tips for staffing success:

Define your culture

Culture is everything to a successful internal operation. Without a distinct idea of who your company is and what it wants to become, it’s hard to recruit people who will work well together to transform this idea into a reality.

I was fortunate because I founded SherpaDesk with my close friend and former college roommate, Jon Vickers. We had a solid development team from the very beginning, and that helped set the standard for the type of people we wanted to recruit and the culture we wanted to create.

If you’re having trouble defining what kind of culture you wish to create, focus on selecting just a few attributes that are important to your startup and beat that drum every day. The expectations will eventually resonate and become an easy guidepost for your team to follow.

Related: 5 Ways to Create an Inspiring Shared Work Culture

Refine your hiring process

In the very beginning, I chose to recruit junior-level talent; the idea being that my team could mold enthusiastic but inexperienced workers into indispensable talent without the cost of hiring senior-level professionals.

We discovered a lot of promising but inexperienced people through this strategy, but we also learned that hiring enthusiastic but inexperienced people can be risky and shouldn’t represent your entire new-hire strategy.

At times, a startup is as exhilarating as it is chaotic. Development is a work in progress, which means the core business processes that enable a company to run smooth internal operations aren’t fully plotted yet.

After some hiring successes and failures, I developed a list of qualifying questions to ask myself before hiring a new employee:

  1. Has the candidate proved their experience and mastery related to their hiring role?
  2. Can the candidate get the job done efficiently?
  3. Does the candidate align with or fill a gap in the company’s needs and culture?

What I needed was people who could take direction and run with it. Once I found employees who could do this, I realized that they saw this freedom as a real advantage. They wanted to work in an environment that allowed them to think for themselves. That’s how I knew I was hiring the right people.

When it comes to hiring, it’s not just about how an employee will serve my business, but also about how my business will serve them and their career goals.

Prioritize your next hires

Startups have the ambition of hiring a thousand team members, but the means to only hire a select few. For this reason, you should create and prioritize the order in which you will hire specific roles.

Who do you need to recruit next in order to accomplish your startup’s goals? A specialized developer, an HR manager or a marketing professional? When you genuinely need all three, the answer isn’t always clear.

In the beginning, all of our focus was on building our platform and making it exceptional. We wanted substance before selling, not just potential. Much of our staffing dollars went to developers, but eventually, we realized that we needed help connecting with our target audience. That’s when we started building our sales and marketing teams.

Be creative and open-minded

Recruiting top talent on a limited budget is like trying to buy a Porsche with an IOU. In this case, while challenging, it can be done with a compelling sales pitch. Think outside the box when looking for promising candidates.

For example, keep an eye out for successful individuals who are looking to pursue a new vertical. They might have transferable skills that will serve your startup well and they’re also more likely to take a smaller salary in exchange for a new experience.

You can also add value to your offer with things like:

  • Low-cost, high impact benefits. Think flex scheduling, casual dress or a “bring your dog to work” policy
  • Equity in the company. If top talent accepts, they are genuinely investing in your success, which is a win-win
  • A great company culture. The office isn’t just “work” anymore; it represents a kind of lifestyle, which means cultural diversity and quality environment will weigh heavily on a candidate’s decision to accept or decline an offer
  • Growth opportunities. Such as specialized training and career advancement

If all else fails, consider offering a higher salary. Money is important, but just as you don’t want the almighty dollar to be the only thing an employee focuses on, it shouldn’t make or break your hiring decisions. Sometimes, you have to set the numbers aside and look at the individual person. If you feel strongly about them, you’ll earn back your investment over time.

Additionally, don’t let geography limit your search for top talent. Remote employment has evolved over the years and gives you a world of talented, eager candidates to explore.

Sell employees on impact

One of the greatest selling points of a startup is the potential for employees to see the significant impact of their work. This is especially true in technology, where a new line of code or the fast and friendly resolution of a user issue can have a dramatic effect on the company’s growing reputation and success.

Think of it this way: The firefighter who throws the water on the fire gets all the accolades, but the people who answer the call, sound the alarm, drive the truck, tap the hydrant, and deliver that water to the frontman are just as important to the mission.

Creating a strong company culture requires routinely acknowledging every employee’s contribution.

Work with contractors

According to research, the U.S. gig economy is more than 87.5 million people strong and generates about $1.63 trillion in income. Despite reports of the freelance sector shrinking, 2017 and 2018 proved that this workforce is thriving and competitive. Working with contractors is a great way to acquire the best talent without having to worry about overhead.

However, if you want this relationship to work, you must treat contract workers like you would a full-time employee. Include them in staff meetings, invite them to visit the office, provide them with a floating desk, and pay them on time. You may find the relationship you build with a contractor can turn into the easiest full-time hire you’ll ever make.

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Never sacrifice the customer experience

As your startup grows, you must fiercely protect the customer experience — period. Don’t outsource customer service to create more cash flow for other hires or expand your workforce so quickly that managing internal growth takes away from the attention you give to each customer.

We’ve had steady growth at SherpaDesk since 2011. With every benchmark that we hit, we reinvest in our solution and the customer experience. Those things represent two of the three core pillars supporting your success, the third being a strong company culture.

Every misstep I’ve had as an entrepreneur was a learning opportunity that helped the company carve out a strong foothold in the professional services industry. Growing a startup business has been an incredible experience, and the nature of our mission played a big part in how we formed a solid company culture.

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