How to Hire

Much like startup performance follows a power law, so do startup employees. The most effective employees create 20x more leverage than an average employee. This is not true in an efficiency company — the best employees might work 2x faster than their peers. But in a high-leverage startup like ours, the effectiveness gap between employees can be multiple orders of magnitude.

Most companies hire by consensus and committee. In a committee of N, each positive vote is worth 1/N of a hiring decision. However, one negative vote will reject a candidate. No matter how a strong a voter’s conviction, their vote will never count more than 1/N. Conversely, the slightest negative view will kill a hire. Consensus optimizes for employees with the fewest objections (least weaknesses). It works well to reduce False Positives but creates many False Negatives.**

When eShares was a company of one, me, our culture was “my culture”. My culture was quickly replaced by the culture of the first ten employees. I couldn’t stop it if I tried — I was outnumbered 10 to 1. Today, the 37 of you that joined us since have vastly outnumbered the first ten. And thank goodness! Our culture today is far better than it was when we were ten and infinitely better than when it was just me.

It is important to note that Trajectory and Experience are not opposites. Trajectory is the first (and second) derivative of Experience. Most candidates have both and both are important. But Trajectory is far more valuable. Our job is not to hire for Experience. That’s what everyone else does. Our job is to hire people whose Trajectory will explode when they join eShares, pulling us along with them.

The best predictor of a successful new hire at eShares is if they like to get their hands dirty. Whether it is writing code, building spreadsheets, calling customers, or stocking the fridge. This is true at every level. Our senior managers are hands-on, care about details, and are not afraid to roll up their sleeves. They don’t last long otherwise.

This doesn’t mean expertise isn’t important. We are a company of specialists, not generalists. Each of us is an expert, or becoming an expert, in our domain. You cannot be successful at eShares without being an expert at something.

In our short history, our best hires were very Different from the team that hired them. They don’t seem Different now because they expanded our culture. They changed what Different looked like.

There is a deep and natural human bias to hire people “like us.” Fight this bias. Hiring Similar means we value repeatability and efficiency over creativity and leverage.

For most of this talk, I have talked about signals to hire. I’ll conclude with a signal to not hire. Confidence and ego are opposites. Modesty and humility are traits of the strong. Ego and arrogance is a disease of the weak and insecure. The truly confident don’t need people to know they are great. They are happy to know it themselves. And the truly Great use their greatness to make those around them greater.