Working for a startup is quite different from working for companies that have been on the market for a long time. The opportunity for growth and independence in completing tasks can attract ambitious employees. However, employment in a startup is also associated with instability and sometimes even uncertain wages. Then, how to hire top talents for your startup? Let’s find out!
Hire top talents for your startup – table of contents:
Equity incentive plan
Building an efficient team when you don’t have much money is a real challenge. Even in the first phases of business development, you need specialists responsible for creating your product. However, many startups do not have enough funds to pay their key employees.
In such a situation it is best to use an equity incentive plan which is a strategy to compensate employees by offering them company shares. Thanks to equity incentive plans, a long-term relationship is built with the employee in question. Such an offer is most often presented to trusted individuals whose skills are essential for the development of the startup, further increasing their loyalty to the brand. In addition, the risk of turnover of the most valuable employees is then minimized.
However, distributing shares on a large scale can also be risky, especially when an employee is already given the entire pool of shares allocated to them upfront. To prevent risky situations, it is worth using vesting, i.e. gradual allocation of shares only after certain conditions are met. Such a mechanism further motivates employees as it makes them realize that the more they contribute to the development of the startup over the years, the more they will gain.
Most startups, especially at the beginning of their existence, are not able to pay high salaries to their employees. Working for a startup involves instability and often low wages, which may change in the future once the startup becomes more successful.
The highly competitive market provides employees with many job opportunities. Particularly, those who possess specialized skills can count on various offers from employers. So, how do startups, which most often can’t beat competition by offering attractive salaries to candidates, attract top talents?
Being aware of having a tight budget, startup founders try to provide their employees with other benefits that increase job satisfaction, while minimizing the potential negative feelings arising from receiving a lower paycheck. A variety of perks are used for this purpose.
Startups rely on people, therefore it is so important to take care of their working environment and integrate them properly. A positive organizational culture attracts employees who care about self-development and a friendly atmosphere. The opportunity to create innovative solutions, think creatively and implement their own ideas is often able to compensate for a slightly lower salary.
Startups also provide employees with continuous development opportunities by organizing specialized training, trips or courses. As a result, young businesses can, at least to some extent, gain an advantage over better-paying companies precisely due to their own innovation.
A virtual salary
The dynamic development of technology has a huge influence on every area of life. The labor market is not an exception. With the increasing digitization, a significant part of work has moved online. Also, various types of cryptocurrencies, such as Bitcoin, have appeared.
Virtual currencies, becoming a new form of paying employees, allow for creative management of the entire payroll. More and more companies accept payments in cryptocurrencies. Cryptocurrency transactions can be completed in a matter of minutes and the cost of transacting is relatively low. As a result, there is growing interest among employees in this form of payment, and especially those who work remotely.
Startups aim at bringing innovation, so why not make the salaries they offer equally groundbreaking? Paying employees with cryptocurrencies enables greater flexibility. However, a dynamic cryptocurrency market creates unstable conditions, which requires constant tracking of the currency’s market value. What is more, the use of such a payment of remuneration is not exempt from systematic reporting of payroll-related expenses and keeping appropriate records.
Working for a startup often involves risk, but the vision of future success effectively motivates employees to join this type of business, even despite low salaries. However, as it is not all about the wages, startup founders should remain vigilant in a competitive job market and provide other benefits to their teams.
You’ve just read how to hire top talents for your startup.Read also: 7 startup roles explained.