Jasmine Ramratan


The Absolute Minimum a Start-Up CEO Needs to Know About HR

As a start-up CEO or co-founder, you are likely pouring your energy and time into making your ideas come to life. Maybe you are early in the development stage, and you dream of the day where you can pin up “CEO” next to your name. You toil away with laser focus on acheiving that next level of development to have a user-ready product. You are an expert in your domain, and if you are truely going to succeed, there is probably no one in the world that can do the job as well as you can. Does this sound familiar to you?

I’m here to say, as your greatest champion, to remember that you are building a company, not just a product.

The most enduring companies are the ones that foster the best work environments, really motivate and inspire their employees to perform, and can really get employees on board with the long term vision for the company.

You are building a company, not just a product

Did you know that companies that take care of their employees the best have the highest IPOs? Lots of start-up founders start a company with a great idea, a lot of technical acumen, and the desire to make a difference in the way business is conducted. Many founders already know what their exit strategy is when they start a company. If this is you, you should know that data proves that if you want to have a successful and profitable exit, you have to build a great company (that includes what we traditionally think of as a company; assets, equity, employees, market share, and goodwill).

To build a company that has never existed before, you NEED your employees to buy into your vision

A successful exit (sale or IPO) takes about eight years. That’s a long time! If you don’t build a great culture from the outset, foster great working relationships, and take care of your employees, you will likely never see that kind of success. To build a company that has never existed before, you NEED your employees to buy into your vision, and employ their energy towards these goals! Why would any smart, motivated, creative, or dedicated person give their energy to build YOUR company, if you don’t treat them well?

Wittingly or unwittingly, initial choices made by founders about the kind of employer you want to be, become imprinted indelibly on your organizations, determining the developmental path your company is likely to experience down the road. For example, a company founded on the idea of recruiting only top talent, paying them top wages, and giving them the resources and autonomy they need to do their job is very different in terms of company culture and brand, as compared to building the kind of company where people would only leave when they retire.

This is why it’s important to start your company on a good path, with the right values, and grow from that solid baseline.

This, in a nutshell, is where HR steps in. As a start-up CEO or founder, you need to know a few things about HR to get started, and what HR will or won’t do for you right now.

Acquired companies were an average of seven years old, while IPO companies went public around 8.25 years, on average. (CrunchBase Reveals: The Average Successful Startup Raises $41M, Exits at $242.9M)

Your job as the CEO or founder is to build the best company possible. As a founder, your time is extremely limited in terms of all the things you need to learn to build a successful company. There are a few basics that you need to personally know and understand, and the rest of it, you should hand off to someone else and let them focus on those areas. Each should specialize in their own areas of economic advantage.

For you as a founder, these basics absolutely include :

  1. How To Find Good Candidates to Hire

2. How to Hire and OnBoard An Employee

3. How to Motivate, Incentivize and Manage The Performance Of An Employee

4. How to Foster Healthy Company Culture and Avoid Conflict that Will Cause Your Company To Fail

5. How to Fire An Underperforming Employee

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