When starting a business, you’re utterly dependent on the people working with you. Without them, you can’t launch an effective marketing campaign, develop your products, build your website, or organize your finances. What they do and how they behave is essential to the long-term success of your business.
Many entrepreneurs starting up, however, don’t take the precautions they should when bringing new people on board. While they might check CVs and ask for references from previous employers to see whether they have the technical skills, they might not probe any further.
If you’re trying to get a startup going, you need to find people who are both skilled and trustworthy. Diligent and strategic CEOs always probe the people they hire as deeply as they can because of their reliance on them. Unlike large companies, startups can’t just “absorb” bad hires. A single destructive employee can often mean the downfall of the company before it gets off the ground.
For this reason, many startup entrepreneurs conduct employee screening for every candidate they hire. Background checks tell them far more about an individual than references from former employers or skimming through social media. They let them find out whether an employee has a criminal record, a history of drug use, past employment history, and much more.
The Best Startups Build On A Strong Foundation
The best startups build on a strong foundation. The job of the startup entrepreneur in the early weeks and months is to protect the entity from long-term threats. Most founders understand the importance of this in the area of intellectual property. Their job is to make sure that they protect whatever makes the startup valuable by implementing patents, non-disclosure agreements and other tools. They use all of the legal machinery available to them to ensure that their core ideas, products and technologies don’t fall into the wrong hands.
The same, however, can’t be said of the attitude of entrepreneurs towards the people that they hire. While a minority of founders conduct thorough checks on each of the people that they employ, the vast majority do not.
This failure to conduct checks is a big problem. The people you hire early on often have a lot of knowledge about your technology and the potential of the firm. They also tend to have access to the company finances and the capacity to undermine your enterprise before it even gets off the ground. Entrepreneurs often have no choice but to trust the people that they work with, and can’t compartmentalise their operations to spread the risks. When there’s just a handful of you, each person tends to have access to sensitive company information.
Again, this argument serves to make the point that the character of the people you hire matters a lot. You want them to be honest, dependable and reliable: you can’t afford to hire somebody with a criminal record. It’s too much of a risk. Without a strong foundation, your startup is doomed to failure.
Early employees and founding partners can create all kinds of havoc for the success of your enterprise. Untrustworthy partners, for instance, could embezzle money, depriving your startup of essential funds that it needs to finance its operations.
Partners can also sell your trade secrets to the highest bidder, go behind your back and make decisions which benefit them, or generally underperform. A bad colleague can enormously undermine your enterprise from the start, making it difficult to get a viable operational business off the ground.
Starting a company is challenging. Only a minority of startup companies thrive over the long-term. If you are to succeed, therefore, you need everyone in your organisation working towards a shared, mutually-beneficial goal. If one of your employees see your startup as a way for them to embezzle money, then your entire enterprise is at risk from the outset.
The job of human resources at your firm, therefore, is to ensure that all of the people you employ are, at the very least, trustworthy. It’s often far better to hire somebody who is honest but lacks technical skills than it is to take a punt of a highly-qualified individual with a shady history. You can help a colleague build technical expertise, but you probably can’t change their moral character.
Prudent founders use background check services to find out as much information that they can about the people they are hiring. Background checking services look for information from a variety of sources, including court records, giving you a clear picture of what a person is like.