Last week, we hosted an event in tandem with our partners at Techspace. We were lucky enough to hostAdrian Blair, CEO of Receipt Bank and former COO of Just EAT as they went through IPO. We had a fascinating conversation, driven by some interesting questions from our packed out audience, across a wide range of subjects. If you didn’t manage to make it, we’ve highlighted the main insights below.
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Advice to companies as they grow towards IPO
Throughout the growth process, there can be a lot of avenues to explore; new verticals, the business offers and potential priorities to name a few, which can be incredibly attractive to pursue. Adrian emphasised the need to work out what your niche is and get incredibly good at that, rather than spreading yourself too thin. This was illustrated by his experience at Just EAT where they were inundated by offers from retailers to form delivery partnerships. They stuck to their business model, did it well, and expanded by geography rather than vertical in order to guarantee success.
This was also incredibly useful in preparing for IPO. Investors want to be able to predict what’s going to happen and this is much easier when the business is simple and large – which is what every business should be aiming for if they’re looking for an exit. Another tip Adrian shared was to hire someone to be solely in charge of preparing for the IPO. Many companies ask their finance team to simply add preparation to their current priorities and this can lead to slip-ups in getting everything done and meeting deadlines.
His final piece of advice was to ensure you focus on people as early as possible. In his new role, as CEO of Receipt Bank, his first priority was to hire an outstanding Head of People. Culture and development opportunities are key for attracting and keeping the best people, and in order to achieve this, you need a good HR team in place early. It’s important to have a strong set of values which are not only selected carefully but are actually lived by the senior management team. If the senior leadership don’t reflect the values in their actions, then the values don’t actually exist within the company. It’s important, for the consistency of the brand, that these values are reflected across international borders – that, at its core, the Danish team operates in the same way as the US team.
However, it’s also important to recognise the differences between cultures. One of your values may be to straight talk, but taking into account differences in the use of direct language in various cultures, will result in a slightly different final outcome.
Hiring advice
Hiring is one of the most difficult and important parts of successfully growing a business. Adrian ensured that all of the country managers he hired were fantastic people who he could trust, so he didn’t have to be involved with the detail of running those operations as company COO. If he hadn’t found the perfect person, he would never settle, and would rather get hands-on in running operations rather than hiring the wrong person. He struggled for months to find the right person to manage Ireland, managing the country himself for a few months, but ultimately struck gold and found an ideal candidate after a long search.
Adrian also warned against hiring everyone from one specific background. Many companies will only want to hire people who have a specific set of companies, but it’s extremely valuable to have a variety of backgrounds and being flexible opens you up to a lot of fantastic candidates.
When interviewing, he admitted to having made a lot of mistakes due to the limitations of an interview-based hiring process. Although unavoidable, this can be minimised by ensuring you meet candidates face-to-face and never relying on video calls to make a decision. He noticed a correlation between bad hires and those he hadn’t managed to meet and has stuck to this principle ever since. Meeting in person also allows the opportunity for other members of your team to interact with the candidate. He’d previously had the experience of discussing a candidate with his assistant, having just had a fantastic interview. She mentioned that when she’d brought him a glass of water he hadn’t thanked, or even acknowledged her when she came in. Although this may seem small, it says a lot about the character of a candidate and is an invaluable insight into what they would be like in the role.
During this interview process, he also has characteristics which he looks for. He spoke of opposing pairs of characteristics which are rarely found together, but when they are, signal an incredible candidate. The first pair he identified was emotional stability vs high energy, highlighting that it’s incredibly important that candidates can stay calm under pressure but also have the energy to motivate a team. However, it can be difficult to find these in combination and those which manage to balance both are incredibly valuable across the business. Perhaps controversially, Adrian has a theory that intelligence and integrity can be opposing pairs too. He argued that often those who were clever were less honest, as they had the option of framing events as being more positive than they actually were, which can be very challenging for getting to the root of the problem. Of course, there are still many candidates who have both and these are the people who need to be brought into your business.
Career advice and differences in roles.
There was a lot of agreement on the panel here:
Adrian was asked about what advice he would give teenagers who had aspirations to reach C-suite positions. He highlighted the fact that what’s taught in school isn’t particularly relevant in the working world, and there are a lot of essential skills which are missing by the time teenagers leave school. Everyone is his position has an obligation to open the door for teens to have experience of the workplace as early and often as possible in a real place of work. To this end, he founded his own business, Circl, which aims to facilitate this.
He also spoke about the differences between the C-suite positions he’d held. Most interestingly, although a lot of people aim for the CEO position, it comes with a lot of negatives too. He felt that it was actually quite a lonely role since you no longer have any peers. There’s nobody that you can bounce ideas off as an equal, nobody you can complain about your boss to, and you ultimately feel all of the responsibility from below and your board above. Despite this, the challenges and pressures are what stimulates him and he’s excited to see where he can take Receipt Bank.
How do consultants fit into start-ups? Start-ups are all the rage. Since we started measuring industry preferences at Movemeon, their popularity among consultants as a destination to move on to has grown.
But how can consultants make the leap? What skills transfer? How do start-ups really work? How do you land a job in one? All very common questions that get thrown at us all the time. Questions that are really hard to answer unless you have an inside view.
Here we hosted an event at the Uber office in Sydney. We brought together 4 ‘start-up gurus’:
Rich — Co-Founder, Movemeon
David — Country GM, Uber, Aus & NZ
Adam — MD, The ICONIC
Rebecca — the 4th employee at Karl Lagerfeld
The panellists had deliberately different experiences across tech, tech-enabled and non-tech. Series A to series C. Domestic to international. Here they are!
We invited 50 consultants / ex-consultants to ask them the nitty-gritty questions. Topped up with some beers, wine & party food, here are some of the things we learned.
How to know when your startup idea is worth quitting your job
Rebecca suggested pitching your idea to your 15 smartest friends and if one said no, to keep your day job. Adam took it a step farther and said there’s a right way and a wrong way to pitch.
You’ll always think your idea is good but in the early stages, it’s invaluable good to get advice and feedback. Oh and don’t show up with an NDA to a pitch among friends (this has happened to Rich).
Dave suggested that joining a high growth startup — particularly as a founder in a new market — can make you a manager/owner of a company, while still having the safety net of additional resources behind you. It’s also a furtive ground to develop your own ideas & learn the skills you need to succeed with your own idea.
What start-ups really value in consultants
There was a lot of agreement on the panel here:
(1) data analysis. Start-ups are very kpi focused. Adam talked about being laser-focused on moving 1 KPI beyond everything else. The ability of consultants to analyse a lot of data really quickly shouldn’t be underestimated (not many backgrounds give someone this tool).
(2) solving problems. Thinking stuff through in a logical, step by step way is an obvious skill of consultants. And in environments that are rapidly changing and feel chaotic, this structure among ambiguity is super helpful.
What consultants really need to develop to be successful in start-ups
Adam and Dave talked about needing to learn how to manage. Even if you’ve been a manager in consulting, working in a business with real ownership (p&l) is a steep learning curve. Adam talked about hiring consultants into more solo roles before migrating them into managerial positions once they’re more comfortable.
Rich and Rebecca talked about having a ‘get sh*t’ done mindset & following that through. Startups are a lot less about the thinking, and a lot more about the execution. Consulting is almost the opposite.
The biggest failing of consultants interviewing at start-ups is answering questions theoretically (“I’d segment the market”, “I’d do some customer research”) and overlooking the really, simple, obvious, hands on answer.
What type of start-up should consultants join?
All the panellists talked about needing to be passionate about the product. Have true belief in its potential. Don’t waste your time working somewhere that doesn’t excite you. Startups can be all consuming, so if this passion isn’t there, you’ll run out of steam pretty quickly.
Dave, Adam and Rebecca all talked about needing to be inspired by the team; and in particular, the leadership. Startups can be quite small environments, so you need to feel comfortable and believe in the culture and the values that develop.
Rich talked pragmatically about the type of start-ups that are most likely to hire you straight out of consulting (200+ VC backed companies hire through movemeon so there are a lot of data points there). In super early start-ups, it’s likely you duplicate the skill set of the founders. They’ll be hiring for core functions like marketing, sales & product. So look for start-ups that are proven but rapidly scaling. At that point, they set about growing into new markets (leads to strategy & business development hires and new country/city GMs) and getting more sophisticated about their operations (e.g, business intelligence hires).
How do you go about joining a start-up?
Finding a start-up job can be a full-time job. You’ll want to meet a lot of people to discover start-ups that are hiring and find one you’re really passionate about. Ultimately, you will need to take a leap of faith — Adam talked about his to-ing and fro-ing in weighing up his options when asked to start THE ICONIC.
Dave covered off his experience heading over to silicon valley for an MBA and some invaluable experience in the home of start-ups. Rich talked about being realistic about what you can achieve in 1 move and being strategic about a series of moves that will get you where you want to go in the long run (i.e, you’re very rarely going to find your perfect job in a start-up straight out of consulting; but you may get to it after a couple of moves once your in the startup space).
Think of it as a game of chess rather than an all or nothing penalty kick. Ultimately, the panel all agreed that you’re going to need to put the day job on the back burner and commit to making the move if you’re going to make it happen. Freelance consulting is a great part-time option to cover your rent while you commit to discovering the perfect opportunity.
The Allbright Academy (spearheaded by two of the UK’s most prominent businesswomen, the AllBright Academy teaches female business leaders how to build and grow their own ventures) recently got in touch to ask us to create 2 ‘how to’ videos: the first on when and how to hire and the second on how to create a great team culture. If you’re interested in hiring find out more by contacting us here. Rich (one of our Founders) took the plunge in front of the camera and here’s a summary of what he covered on hiring, including some links to other helpful content. If you’re after his write up on culture, you can find that here.
WHY ME?
For a summary on recruitment, I’m perhaps an odd choice. I don’t have a recruitment or HR background. In fact, movemeon was established to disrupt traditional recruitment. My perspective is one of a Founder of a growing tech business – learnings from growing our own team embellished with our experience partnering 100s of start-ups and global companies. So here’s a step by step list of things to think about as you consider hiring a new employee.
WHEN TO MAKE YOUR FIRST HIRE
There’s a tricky balance to strike here. Don’t hire for the sake of it. But avoid hiring so late that your growth slows down. In a nutshell, hire when you can foresee a lack of skills or capacity that would slow down your growth. And you have the funding to pay their wages!
Before that, put in the very hard yards yourself (as doing more yourself & developing your own skills takes less time in the early stages than hiring & managing others). Your first hire is going to differ depending on the type of business you have. But if you always hire to drive growth, your first hire is going to be filling the gap that is slowing you the most at the time.
PERMANENT VS PART-TIME VS FREELANCE VS OUTSOURCE VS INTERNS
All too often Founders default to hiring full time, permanent employees. But that’s the most costly (both in terms of time and money) type of team member you can have (see the write up on culture vis what it takes to create & retain a high performing team).
This sounds simple but isn’t, mainly because most of the job descriptions you’ll have experienced in the past (particularly if they were with big companies) are poorly written. The key is to put yourself in your candidate’s shoes. A great job description entices people to apply. It’s a piece of marketing (picture things you buy and the marketing campaigns behind them). It starts with a compelling job title & one-line overview. And is followed by a one-paragraph ‘best bits’ summary and then the detail. The main things people miss are:
you and your current team (the most common reason people enjoy their work is that they like the people they work with);
the vision for your business (most Founders talk too much about historical achievements, funds raised, etc, and not enough about the future – which is the part that this employee will contribute to);
the nice to haves vs the must-haves (be strict – if you make a massively long list of must-haves, it will rule too many people out. Better to speak with a wider audience and screen people out early in the interview process if needed).
Obviously, this very much depends on the role and on your budget. The fact is that very early-stage businesses can’t spend on advertisement. So you may want to focus on free publicity. Here are some channels that we’ve used:
University careers sites (great for junior hires at grad/intern/1st job move level),
Angelist/Work in startups (and other free start-up focused sites),
personal networks,
social media (your own and your company’s),
ask for a free trial.
If you are paying to advertise, favour sites where you pay only on results rather than upfront – be that a % of fee only if you hire (in which case it’s only a small incremental cost on top of the total cost of employing & massive ROI if that employee proves instrumental in your growth). For instance, movemeon has a success fee model of 15% of basic salary (which is about half the cost of a traditional recruiter focused on strategic/commercial hires). If you are going the agency route, make sure you read this article on working with recruitment agencies.
Our golden rule is that it’s better to do a 15-minute video call with 10-15 candidates than decide on 4-5 candidates to meet in person purely on the basis of the paper. Experience shows that very rarely do your favourites ‘on paper’ remain the front-runners after an initial chat.Be clear from the start as to what your interview process will involve. Our interview process is 4 stages:
video chat (30 mins max);
in-person interview (1 hour);
case study interview (2 hours and involving them talking you through their thoughts to a problem you’ve sent them in advance;
social setting – lunch, meet the team etc;
throughout this, we always give feedback as to why someone isn’t progressing to the next round (and it’s almost always appreciated).
Lastly, make sure you set aside enough time to get through the process quickly. The best candidates always have irons in the fire and we’ve witnessed so many companies miss out because they have been too slow to complete their interviews and the candidate has taken another job in the meantime. And if you need this person ASAP, don’t forget that they’ll probably have a notice period too (typically at least 1 month but up to 6+ for senior hires). All told, the average process for a permanent hire takes ~4 months from going to market to the candidate starting (clearly the process is far quicker for freelance hires or graduates/others who don’t have a notice period).– For the importance of phone/video interviews & how to make them successful for recruitment, read this article. – For a more detailed account of what we learnt from recruiting for movemeon, click here.
GETTING AN OFFER ACCEPTED
If you are clear from the start as to what your budget is, you are much more likely to have an offer accepted. Our data shows that you are 400% more likely to hire first time round if you specify the ballpark compensation in the job description. Never finish your first round (in our case, the video chat) without establishing a candidate’s expectations and current earnings. There’s no point trying to hire someone you can’t afford and it’s a hugely frustrating waste of time if you only work that out at the end of the process.
In order to entice senior hires, you may need to create a share options scheme. More junior hires tend to value basic salary, bonus and perks more. Ideally link bonus very clearly to company and personal performance; clearly rewarding those who smash it out of the park. If you don’t have loads of cash, don’t worry. Start-ups are very popular so you should be able to factor that into what you have to pay. Also, employees value perks and a thoughtful environment as much as they value pay. So be very conscious about putting all of these in place (holidays, flexible working, pension, snacks, team drinks, team away time, etc, etc). At movemeon, we go on a yearly company holiday. We described its benefits for business performance and morale here.
Make sure that you have a robust employment contract and be mindful of appendices designed to offer you and your business necessary protection if someone leaves (e.g, confidentiality, restrictive covenants vis joining setting up a competitive business). There are plenty of inexpensive disruptive law firms focused on start-ups. And also platforms that will look after your HR tasks (contracts, staff handbook, payroll, pension, etc) as well as your accounting tasks and statutory returns.
ONBOARDING
When a new team member joins, you need them to be as impactful as possible as quickly as possible. This takes more thought than you first realise. So think through:
what they and you can sort in advance (useful background reading, PAYE admin, IT equipment, system set up);
plan for week 1 (a combination of introductory sessions and learning through doing).
When you’re doing this thinking, try to construct and codify a process that you can repeat for all new joiners. That way you’re not having to reinvent the wheel every time and can have some template emails and documents saved.
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