How to Win at Hiring as a Mission Driven Startup
Hiring is tough for startups. Especially at the early stages, it can seem like a daunting task. If you’re the CEO, you probably are already stretched thin before you contemplate hiring new team members. Plus, it’s hard to compete with companies that have a more established brand, can offer higher pay, and appear less risky to prospective candidates.
Continued layoffs from tech companies big and small are adding increasing uncertainty to the talent market. This has led some companies to freeze hiring, but with many talented individuals currently searching for their next role, some startups are looking to seize on this moment. And some sources are pointing to evidence of a tight labor markets where laid off tech candidates are finding new jobs in with relatively quick turnaround.
Hiring for the right fit at an early stage startup is key to the company’s continued success. When talking to founders on our podcast Mission Driven, we noticed patterns and distinct advantages that mission driven startups have in hiring. The trend has been reflected in a number of articles, including a recent feature on climate tech startups by The New York Times: “As tech companies slash perks and cut jobs, the downturn has spurred a wake-up call among many workers, causing them to question whether their company’s role in society — selling ads or selling stuff, often — was actually making the world a better place. The result? More are now flocking to climate start-ups, just as investors pour money into the field.”
Adding fuel to the fire are the changing priorities of the new generations entering the labor market. According to Gallup, 55% of employees born after 1989 are disengaged. Companies with a social mission can highlight alignment to candidates’ personal missions to combat this disaffection and win over strong candidates, even when other organizations can pay more. Gen Z and Millennials are especially concerned with alignment between company missions and their own personal values. When considering a job, they rank a mission they believe in as one of the primary decision factors.
Read on to discover ways that your mission driven startup can win at hiring.
Mission > Money
An early stage startup is often capital constrained and cannot offer competitive compensation in comparison to more established tech companies. This can make it hard to attract top candidates who are highly sought after and might even be courted by the companies offering high compensation and equity packages. However, candidates seeking mission driven companies may be self selecting in the interview process and prioritize mission alignment and job fulfillment over money and equity, turning down higher compensation offers at bigger companies.
Marc Tarpenning, founder of Telsa (and now an investor at Spero Ventures), shared an anecdote from the early days of Telsa in which he was interviewing a top candidate whom he knew they couldn’t compete for in compensation offers. When he broached the subject of compensation, the candidate surprised him by stating he knew that Telsa couldn’t exceed or even match his current compensation. He had in fact already had a conversation with his spouse and was willing to accept an offer lower than compensation at a bigger tech company because of how passionately he believed in pioneering carbon eliminating vehicles. (We’re sure the stock benefits have been worth it down the line.)
Employees want meaning in their work
As referenced above, more and more people are looking for meaning in their work. This is generational, but also true for those who realize the urgency of issues facing our society like climate change, inequity in society, and human health. They want a reason to wake up in the morning and your company’s mission is just the reason for that.
In addition, many mission driven companies are at the cutting edge of technology, often leveraging the latest science and technology to build their products. Joining your company presents an opportunity to be at the forefront of innovation.
Numerous CEOs we talked with on Mission Driven cited social mission as an advantage in hiring. One refrain we heard repeatedly was people want to make the world a better place for their children. For example, Connor Landgraf of Eko Health said that many candidates tell him they’re making a choice between solving something that is for society’s good versus doing something that makes a lot of money, “Many of the best candidates say they want to make the world a better place for the children, which gives us a big advantage.” These individuals faced increasing disillusionment with technology being used to create large financial returns and they found true fulfillment when joining a company that had a clear mission to improve society.
Senior people who have made their money are now looking for purpose
Another edge for mission driven startups may not be immediately obvious. We heard a few stories of small startups that were able to attract senior level employees because of their mission since the new employees had already made their money and were consequently driven to focus on work that was more aligned with their drive to make the world a better place.
Muffi Ghadiali of Electriphi expressed his shock at recruiting his own cofounder. He thought he would have to pull out all the stops to bring on Sanjay Dayal who had been a senior leader at top corporations and startups. But Sanjay made the decision fairly quickly saying he knew he wanted to make the world a better place for his kids. Muffi jokes that he probably wouldn’t have been successful in bringing on Sanjay if he had started a gaming company. Ultimately, Electriphi was acquired by Ford at a huge premium.
Show the human side of your customers
Another lesson in the recruitment of your team is showing the human face of your customers and the real world impact of your company. Nan Li shared a story from one of his portfolio companies while recruiting for a Head of People. This company had a wall of photos in their office of people with rare diseases, people the company served with its products. When they brought Head of People candidates on site, the wall was a conversation point and the team was able to talk about their meaningful impact on customers’ lives. This translated to more interest from candidates who were eager to make a meaningful impact on society.
Be the representation
Having a strong mission can also create a flywheel effect since the company is more purposeful about positioning in marketing, sales, and other endeavors. Heidi Patel of Rethink Capital told the story of Ellevest CEO and founder Sallie Krawcheck when she landed the cover of Money magazine. Sallie brought her entire women-led executive team to the photoshoot and had them appear on the cover with her. The final cover shot featured one of her team visibly pregnant — in fact, the first visibly pregnant woman on the cover of a business magazine. This was revolutionary for a number of reasons, but created strong downstream effects for the company as women and others were inspired by the inclusive stance of Sallie and her team. This no doubt attracted candidates who wanted to be embraced by their employer.
Once you’ve hired your team, take care of them.
Now you’ve brought on new team members! We got some advice on employee retention and morale, as well as culture building. Given the mission driven nature of your company, your employees most likely have strong personal alignment to this mission. It’s one of the major reasons they decided to join the company. While this is great for motivation, it can also mean some are more susceptible to burnout. Monitor your team carefully and make sure to give them permission, time, and the example of rest and rejuvenation. Michael Lombardo is a strong proponent of these tenets. He notes how his team at BookNook started jumping in when teacher shortages plagued their company’s education and tutoring platform. While he admired their enthusiasm, he kept a close eye on employee morale and energy to avoid burnout:
“From an employee motivation standpoint, it’s a blessing and a curse. You feel this sense of responsibility to the communities that you’re working with… On the one hand it’s incredibly motivating for our workforce, for our people to go above and beyond. When we launched in Los Angeles, some tutors didn’t show up to their sessions and our team dove into the Zoom rooms, saying, ‘We’re going to tutor these kids ourselves.’.. But that can burn people out really fast too. So I think it’s really important that mission driven companies, while motivating employees and using it as a tool to keep people really fired up… are also taking care of them and making sure they don’t …burn themselves out…”
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Hiring can be tough, but there are a number of ways mission driven companies can stand out. Highlighting the do-go focus of your company can attract highly skilled and motivated people to join you in your journey and create a highly performing team.
Listen to these insights and more on Mission Driven: https://anchor.fm/mission-driven
