Hypergrowth: Why Talent is Key to Scale
There are 3 key factors in having a successful startup or company:
- Product
- Market
- Team
This comes as nothing new, you’ve heard this before. Investors are always looking for Product, Market, and Team. Most important is the right Team. Why?
If you don’t have the right market, you can pivot. If your product hasn’t hit product/market fit, you can pivot your product.
What you can’t easily replace is your team.
If you don’t have the right team, you won’t beat your competition – or worse, you won’t even get to market. The right team can pivot, and quickly.
Finding the right talent is critical to get traction and growth.
Talent ROI
There’s no exact calculation on human capital. But we KNOW that talent matters. Just look at the top companies – Google, Facebook, Apple, Microsoft – they are in a WAR for talent. They will do anything to hire the best talent because they want to win. So, why shouldn’t you?
Per the Harvard Business Review
“A few talented people make a huge difference. This is one of the most replicated findings in management research. In any organization or group, a few people will make a disproportionate contribution to the collective output. Around 20% of individuals are responsible for 80% of the output … 20% of individuals (or less) tend to account for between 80 and 98% of performance. Thus talented people – the vital few – are the main driver of a company’s success, and companies will see much higher returns on their investment if they devote more resources to the few people who are making a big difference, as opposed to trying to make the “trivial many” more productive.”
Source – https://hbr.org/2016/10/talent-matters-even-more-than-people-think
Referencing the Harvard Business Review article above – is your company’s talent pool full of the “trivial many” just to fill headcount or do you find the vital few who make a disproportionate contribution?
If you aren’t focusing on the quality of your hire, you’re not focusing on the quality of your product / company output.
Unfair Advantage
Companies who hire exceptional talent have an unfair advantage.
Netflix is a prime example of a company that has been able to attract great talent. The video streaming giant was founded in 1997. In 1999, Netflix launched its first service with 1,000 titles available for rental by mail. By 2008, it offered a streaming movie service and was a major player in a new entertainment market. In 2012 Netflix became Hollywood’s largest supplier of video, outpacing the largest U.S. cable providers.
Today, Netflix is one of the most valuable entertainment companies in the world, with a market cap of more than $119 billion—more than Disney or Comcast.
As for talent, between 2009 and 2012 Netflix grew its workforce by an average of over 20 percent annually. In 2013, they announced they were looking to fill over 1,000 positions. That’s a lot of new talent coming in to help with all the new features and content being created.
In terms of company culture, Netflix is definitely one of the most employee-centric organizations out there. They offer great benefits, competitive salaries and really cool offices.
They also practice what they preach when it comes to their own culture. Their core values are all about freedom and responsibility, which is something that can be seen throughout the entire organization. They allow employees to be autonomous and work how they want.
Having a great culture that allows autonomy and freedom to the brightest will provide the best space for the highest skilled to outperform.
Companies who hire a trusted and competent software engineer through FullStackRemote are hiring the top tier, the elite few who disproportionately and positively impact growth.
Quantifying Great Talent
The best talent is exponentially better than great talent.
How do you quantify talent?
Of course, we have tests at FullStackRemote to determine technical acumen, on-the-job-performance, communication, and cultural fit. We only allow senior (5+ years level or above) on FullStackRemote. But, having senior-level talent doesn’t always mean you are the best.
The real numbers come in time spent on a task to complete, done with better level of expertise of someone less competent.
We eat our own dog food at FullStackRemote (FSR). We decided to test our theory. We hired a senior-level expert developer on Upwork. His cost to us was $85/hour.
After 3 weeks, he completed a series of tasks. He did well, but we still weren’t quite happy.
We hired Marcos from our own network. In 3 days, and with the same number of hours, at $50/hour, Marcos was able to complete the tasks that had been pending for the other developer to complete.
A 10x improvement in time and at nearly 50% less cost.
This is what we have at FullStackRemote – top-of-the-curve talent at often nearly 50% the cost.
We mentioned test scores. Here’s one example of Ronald, in FSR’s network, who took this React coding challenge. The task allotment was for up to 90 minutes. According to the data provided by our testing platform, only a small percentage of people taking the test passed, and even fewer, passed in less than half the time.
As you can see, Ronald scored a perfect 100% – in only 23 minutes (versus the 90 min allotted).
Real Cost of Hiring Average-Level Talent
Training an average employee who costs less and expecting them to produce more is slowly driving your company to the bottom.
Make the right hires the first time. You cannot get this wrong. You’ve worked this hard and come this far – now is not the time to make bad hiring decisions. The cost of a bad hiring decision is too high.
Per Medium, the cost of a bad hire can reach up to 30% of the employee’s first year earnings. If you’re paying $100k+/yr that’s over $30,000 per bad hire.
Source: Medium
You can find awesome talent on your own. But, finding great talent is like finding a needle in the haystack. More importantly – It takes so. much. time. On top of that, there’s no guarantee that your new hire will succeed.
Why risk not getting it right the first time? You know the drill, you hire a non-A player to save money. In the end it costs you an average of 30% of one year’s salary to fire/hire/retrain the next person. If you haven’t had this experience, you’re lucky – don’t do it!
If you want a guarantee of success, then you need to work with the people who can provide that guarantee.
If you want to have surgery, do you read about how to do it yourself and grab a butter knife? No! You have to trust the very best.
You work with the best – because they are the best. You want to win, so do what it takes to win.
Maybe you’ve been burned by on demand networks or dev shops overseas. What if you could plug in the right talent that will take your team to the next level – without having to spend 3 months searching, nurturing, vetting, training – and crossing your fingers.
FSR has a replacement guarantee. If they don’t work out for any reason, we replace them. How great is that? Another 3 months and $30k saved.
You focus on your business, what you do best. Stay hyper focused on growth and do whatever it takes to win. That means working with people who know what you need – and deliver.
Cost of Upper-Echelon Talent
FullStackRemote charges more than a large freelancer site because we only allow unrivaled talent on our platform. However, when considering time value for money spent, we are able to 10x that value for 50% the cost, on average.
That means you will end up with a better product at a better price at the end of the day. If you end up paying $80/hr vs $40/hr but you get more than 2x the output, it’s worth every penny over the 2x mark.
Imagine waking up to clean code check-ins on Github and not having to lose any sleep. You can trust the work will be done, and done really well, and never having to micromanage. As one of our clients, Desmond at Juno Medical told us “you’ve taken a huge weight off my shoulders.”
We’ve taken the time to present you with a winning formula, such that, when you hire first-rate talent, you see first-rate results. These are the Silicon Valley secrets to hypergrowth (like Netflix) that you get to have as well when you work with us.
Schedule a call with FullStackRemote and supercharge your growth with the best talent.