At first look building a business on a macro level appears to be a linear series of steps. From my vantage, forming a startup and building it into a business is part art form, part leadership/negotiating reality distortion, and a heavy dose of successful practices. The framework leveraged to build out a startup needs to be "precompiled" answers to common questions. As a founder you will become overwhelmed with minutia if you attempt to micromanage all aspects of a growing business. If you want to do everyone's job be a consultant not a founder.
Here's the external view of business conception:
One or a few founders hash out and build a working prototype. Then they seek early funding and hire super employees and score some marketing assistance. Then seek out more funding or leverage revenue from early customers to build out the business. Down the road they sell the business or continue building it by efficiently using revenue or investments to hire and acquire infrastructure.
The reality is that building a business is a threaded overlapping set of priorities and needs. In order to even approach investors you should identify a market area of proven traction. You have to look for employees far in advance of when you desparately need their help. You'll count on early employees to connect to trusted associates who can work within the developing furnace of value creation that defines a startup. From those with experience leading startups (Paul English of Kayak), only two out of three hires will match the work culture you cultivate. Those odds aren't too bad compared to the small percentage of startups that succeed each year.
Tyler Gillies (Chief Tech and cofounder of Victus Media) and I have been discussing plans for our first hire. The following is how I see the major aspects of the decision:
- When do we hire? If we seek help now it can greatly improve the businesses chance of growing so it's on top of my priority list. If we put off hiring until we have revenue/growth/investment it would be more natural timing. But we may need help at that point, not three months later
- Who do we approach? There is an enormous pool of talented folks who could be ideally suited to our startup both outlook and skill wise. What skill areas do we need most help with now, and will we need as the business develops. Now we need UI/UX aid, as well as engineering. Hiring also means legal/accounting aid. Later we'll need more hacker/engineer superstars and perhaps marketing assistance
- How will we hire our first employee? We can offer an employee a mix of cash and equity, go after a short term consultant with pure cash, or bring in someone willing to work purely for equity. How much equity, and what time frame this is earned over are vital parts of the negotiation. We'll certainly need legal help setting up the business officially with vesting for both Tyler, myself, and any equity hires
Thus far I've put off the idea of heavy recruiting. I have occassionally laid down a virtual landing page or two for those interested, but before any deals can be worked out I need to straighten the when, who and how.