At Initialized, we understand that as a founder, your initial experiences matter deeply, and every decision can feel like it carries significant weight. That’s why our founder impact team is launching a new blog series, ‘Your First…,’ aimed at guiding founders through key moments in areas such as marketing, PR, talent, go-to-market strategies, design, community/events, storytelling, content creation, and more.

Earlier this month, we published our first post to help early stage founders craft and launch their first funding announcement. Today, we’re sharing some core considerations with founders making their first 10 hires.

The current talent landscape offers a surplus of available talent, making it easier for early stage startups to attract job seekers due to market conditions and declining job stability at larger companies.

At our recent May Talent Summit, Tanda cofounder Jesse Chor said that in today’s economy, “the safest place to work is actually a startup” because of all the recent layoffs at FAANG and other big tech companies.

Anecdotally, one of our portfolio companies shared that they received over 1,000 applications for a contract role in 48 hours. While many of our portfolio companies have reported being overwhelmed with job applicants for their open roles, not all newly available talent is a good fit for your early stage needs.

Besides your product, your most important asset is your team. When you are just getting started, you have limited headcount and limited funds so every player counts. That means every new hire is critical to building on your momentum and solidifying your team culture. A team determines the pace and direction of a startup’s expansion. In fact, the team and the culture you create (implicitly or explicitly) is a byproduct of whom you initially hire.

As head of talent for Initialized, I’ve helped over 70 portfolio companies grow their teams and build their culture. Here are the core considerations I share with founders as they make their first 10 hires.

Optimize For Talent Density

Netflix pioneered the term talent density to refer to the quality and density of skills, capabilities, and performance within a company.

To optimize for talent density, you need versatile MVPs who bring new ideas, a high-risk tolerance, an entrepreneurial disposition, an enthusiasm for working outside of defined roles, and the ability to work as a team of one.

I call this force-multiplying combination of qualities “startup readiness”. A candidate’s startup readiness comprises the technical skill sets, mindset, and life situation preparedness required to thrive in an early stage company.

Hire For:

  • Individual contributors or player-coaches.
  • Strong generalists, doers, and tactical problem solvers.
  • Raw horsepower executors.

Don’t Hire For:

  • Executives and leaders who are great strategists, but may not want to execute (founders are often the strategists at this stage).
  • Specialists with specific abilities (this may not apply to companies in super niche fields).

Most seed stage companies have between eight and 10 people. While your first three hires are often software engineers to flesh out your initial product offering and force-multiply your technical capacities, early non-technical hires ideally take something off a founder’s plate (even if they are a part-time addition).

The first 10 hires often include the following roles:

  • 3-4 full-stack software engineers.
  • 1-2 salespeople (sales often remain founder-led).
  • 1-2 customer success/implementation managers.
  • 1 designer.
  • 1 ops generalist.
  • 1 recruiter (often contract if hiring becomes concentrated).

Although less common, your first 10 may also include a hire in product, growth/marketing, people ops, or finance. If you are a company that made one of these hires in your first 10, I would love to hear from you. There are always exceptions to the norms, and every company has its own unique journey and team composition.

Leverage Your Network

According to the HBS Rock Center Startup Guide, seed founders spend 25- 40% of their time on hiring. This may seem weighty, but getting your first 10 hires right is mission-critical. Each new hire will prevent overextension and minimize capacity issues on your team. Additionally, founders can scale the work they are doing and more rapidly execute company goals.

Many of your first team members will be sourced from your network, as trust is paramount and working with known entities helps you quickly execute on your early deliverables. In his Founder’s Guide to Startup Hiring, Gem’s founder and CEO, Steve Bartel, notes that sourcing and recruiting network connections yielded the highest ROI as he was building out his founding team. The majority of Gem’s initial eight hires were first-degree connections of the cofounders.

For founders with a less tech-dense network, second-degree connections and targeted outreach via LinkedIn and GitHub yield the most responses. Consider utilizing an informational interview approach in your messages. Candidates are more likely to respond to founder outreach when you express genuine curiosity about work they have done, rather than leading with “I’m hiring for___.”

A Note on Diversity:
Your network may be your best initial candidate pool and expedite your early team assembly, but continuous reliance on your team’s network can result in a very homogenous team. If your initial team is not diverse, you will exponentially get more of the same. It’s important to expand your sourcing channels past the 10-person mark if you are committed to addressing future diversity debt on your team. Working on diversity when you have 50 employees is much harder than committing early on to building more inclusive team foundations.

Grow Strategically

Many of your first 10 hires will be individual contributors reporting directly to founders, a mix of contractors and full-time employees. I’ve seen portfolio companies give away senior titles too early and caution against hiring executives before you actually need that level of strategic partnership.

The most common non-founder management titles I see at seed stage are “Head of”, or “Lead” roles that often start as player-coach teams of one. Consider delaying a management hire until you have eight to 10 employees, as a flat organization provides you with ultimate visibility and an agile execution environment. On average, a manager has the bandwidth for four to seven direct reports. As teams grow beyond 10, flat reporting structures become more of a drain on a founder’s time, coinciding with the need to add another layer of management to the organization.

Reasons to Delay Executive Hires:

  • Minimizes title inflation — the person you need now may not be the person you need at Series B. Giving away titles too early makes later stage hiring more challenging.
  • Preserves runway — do you need the executive who made $350k in their last Series C+ role?
  • Allows your high-performing early team members to potentially grow into a role, be flexible with new responsibilities, and keep pace with changing company needs.

Key Takeaways

  • Build your early team with the same attention, intentionality, and creativity you apply to building your product.
  • With limited headcount and resources, every player counts, and every new hire should catalyze your velocity.
  • Your first 10 hires set the cultural foundations for everyone you hire moving forward.
  • Embed inclusive elements into your hiring process early to minimize future culture debt.

To support our portfolio companies in their early hiring efforts, we offer a candidate database, a hiring channel to share candidates, ongoing talent related workshops, trainings, and programming to build your hiring muscles. 

We also just launched an annual Talent Summit to connect startup ready job seekers with hiring companies.  If you are a job seeker looking for a new startup role, please join our Talent Den here.