Joining a startup: Essential negotiation talking points for HR, recruiters, and founders.
As a recruiter, founder, or talent partner at a venture capital fund, attracting top talent to join your early stage startup can be a challenging task, especially when the cash compensation package may not be as competitive as that offered by larger companies. However, there are several non-monetary benefits that can make a startup an attractive option for a candidate.
Here are some key talking points to consider when selling an early stage startup to a candidate:
⚡️ Highlight the impact
Explain to the candidate how their impact will be significantly greater in an early stage startup compared to a larger company. For example they will have the opportunity to build the engineering function from scratch, including the choice of technologies, best practices, engineering roadmap, and building a culture of growth.
📈 Career growth
Discuss how joining a startup as a VP Engineering will be a catalyst for their career growth, as getting promoted at a larger company can be slow and bureaucratic. Emphasize the importance of leading the vision and hiring for the engineering team from scratch.
✍🏻 Resume building
Highlight how having both big company and startup experience will increase the candidate’s marketability for future job searches and open up new doors. This experience makes them a well-rounded candidate with lots of perspective.
🤑 Equity potential
Explain the potential to make money from equity by joining a startup at an early stage.
- I recommend using Index Stock Options guide for this. I must say, I’ve never come across a better resource than this. You will find guidance on stock options practice and policies for twelve additional countries, within Europe and beyond. I highly recommend checking it out so next time you master how you speak about the equity package.
- At Deepnote, our team also developed our own stock options calculator in a simple spreadsheet. I am usually sharing that stock option calculator with our candidates, which will give them an estimate of the value of the option grant they have received. It should be pretty straightforward to understand what the grant entails.
- Or you can easily just re-use this calculator online!
🎯 Career goals
Ask the candidate what their longer-term goals are and align your pitch to them. If they want to start their own thing one day, emphasize that an early stage startup will provide the exposure and experience to make this happen. If they want to make a lot of money, sell hard on the equity potential. If they want to grow in their career and become a CTO, emphasize the unparalleled career growth opportunities and the importance of the team they will be managing.
🌱 Growth potential
Emphasize the huge growth potential of a startup role, with both depth and breadth to the role, compared to a cap at a tech lead level in a larger company.
👷🏻♀️ Building from the ground up
Highlight the excitement of being part of the foundational building blocks of a company, rather than building on top of a problem someone else has already been working on.
🦺 Always a safety net
Reassure the candidate that an opportunity at a larger company will always be there if the startup doesn’t work out. However, they may always regret not taking the leap to join a startup.
There are so many compelling reasons for a candidate to consider joining an early stage startup, even if the cash compensation package may not be as competitive as that offered by larger companies. By highlighting the impact, career growth, resume building, equity potential, and other benefits, you can make a strong case for why a candidate should join your startup. 🤩
Further reading
These resources provide additional insight and perspectives on the topic, and can help HR professionals, startup founders, and talent partners in their efforts to attract and retain top talent in early-stage startups.
- Personally, I highly recommend this episode of the Startup from Gimlet for its accurate representation of selling a scrappy startup to someone from a stable job.
- Alicia G. Lau, Head of Talent at Kleiner Perkins, recommends this article for its good points on the topic.
- Molly Gunderson, Director of Operations at Freestyle VC, suggests this article for its helpful insights.
Negotiating a job offer is a critical skill when you are building a startup. To help you tackle this challenge with confidence and ace your negotiation, we’re thrilled to introduce you to our super weekend course Hiring On Ramp specifically designed for HR professionals, recruiters, and founders.
In our course, you’ll learn how to effectively negotiate a competitive salary, benefits package, equity, and other essential elements of your job offer. This course is great for HR professionals seeking to attract and retain top talent, and founders building and scaling their team. It’s a great opportunity to enhance your negotiation skills and gain a competitive edge in the startup world.
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