Everyone’s on the lookout for new talent. But it never matters more than it does when you’re an early stage startup, trying to get off the ground.
If we have seen further, it’s because we stand on the shoulders of giants.
The first 10 people in an organization are commonly referred to as the ‘base’ team. They’re the team that build the product and watch it try to run on shaky legs. 10 to 100 is the ‘growth’ team, the team that really help the product take off and find its audience.
The genetic makeup of the base team and the growth team decide the future of the company forever. With a sales driven company like Hubspot, it comes as no surprise that 36% of the company was made up by just sales folks.
One day, out of sheer curiosity, I decided to figure out the composition of the first 100 employees for Freshworks Inc. How many engineers? How many sales people? When I went back to sort through the data, I discovered this ready-made pie chart that begged to be used.
I- er the person who made this, took the liberty to put people who wore multiple hats, like our CEO Girish Mathrubootham, under the hat they wore most of the time (after CEO, it was Product Management).
Interestingly, the biggest team was Engineering (which encompassed developers, architects and QA folks) which makes sense because the first few people you hire are those necessary to help you get the product out the door. Sales came a not-very close second and Marketing, a distant third. 2 years into the business, the thrust was towards building a robust product that would meet and exceed customer expectations and then, selling it to businesses everywhere. Freshworks hired the people necessary to get the product out of the door.
But how did Freshworks find these people? What kind of hiring strategy was in place? And how did this impact our growth?
Leveraging personal networks
When Ramesh Ganapathy interviewed at Freshworks, the company was basically 20 people in a room. In an answer to a Quora question, he outlines his story of how it came to be. He was complaining to a friend on Twitter about taking up a “boring” IT job which led to an introduction to Girish Mathrubootham which led to a discussion at the office which led to a job offer.
When he joined Freshworks, he was employee #35. He referred thirteen of his friends to Freshworks as well, swelling the ranks to a (then) unimaginable 48 people. Similarly, there are many such employees in the first 100 who found their way to Freshworks through friends, family, and in one case, a tennis partner. When we did the math, we discovered that 71 people of the first 100 employees (including yours truly) came in through a referral.
In the early days, almost all of our new hires came through employee referrals. As Girish recounts in a ‘How to hire for startups’ session, the strategy in the early days was to ask his employees to refer the best people they’ve worked with.
This helped us in three ways:
- Screening could happen in an accelerated, refined manner. Unlike with other applications, we actually had an insider with referrals. We didn’t have to look at these applications as just resumes, we could look at them as people. We’d just invite the employee into the room for our discussion and ask them their opinions. This helped us validate our gut feeling with other people’s perceptions.
- Their friends work with us so there’s no anxiety about potential colleagues and the social connections you have to forge again with a new workplace. They settle in faster and they’re happier with the workplace too. Everything’s easier when you have someone to have lunch with, every day.
- The “jet lag” wasn’t as severe as it would have been if they were complete strangers. The people who wanted to work with us were enthusiastic about what we were doing and were willing to take risks to do it. Keep in mind that this wasn’t the Freshworks with the 7 products, the 100,000 customers or the $149 million dollars in the bank. This was just a group of people in a small office with big dreams.
And we aren’t the only ones who think so. Jobvite recently did a study where they found out, by large, referrals get hired faster, stay longer and are more passionate about the company as well.
Hiring through referrals also had an unexpected effect on our product strategy. As we scaled up, we realized that the tools we had at hand weren’t able to help us provide the best hiring experience possible and so, we built our own. Does the flap of a butterfly’s wings in Brazil set off a tornado in Texas? We’d like to think so.