The hardest decision CEOs have to make is who to keep and when to fire, says Greg Marsh, co-founder of high-end hospitality firm Onefinestay, which was sold to AccorHotels for a widely reported £117m (€148m) in April 2016.
Greg shares this, among other scaling tips in our new Upscale book – a collection of insights from 25 of the UK’s top tech entrepreneurs, investors and industry veterans, on the challenges all startups face as they grow.
In the meantime, here are his top 9 insights from the book.
1. It’s really easy to say “Hire slow, fire fast”
But it’s incredibly difficult to do that in practice. Fire too quickly and you risk looking capricious to your other senior execs, your board and others.
2. The only way to retain really good people is to promote them
Just a tiny bit faster than you feel comfortable with. You can develop people at an astonishing rate if they’re really good and really engaged.
3. It’s psychologically difficult to tell people they’re failing at something
Even if you can argue, over the medium term, that you’re doing them a favour.
4. Hiring executives is incredibly hard
Getting it right, really right, more than about a third of the time is just luck.
5. Executive recruitment is harder in UK startups than in the US
In the US, it’s typically one- or two-week notice periods for senior executives, and the result is a much more liquid and dynamic senior executive labour market.
6. Most people are shockingly bad interviewers. And they have no idea how bad they are
Don’t rely on your own intuitive judgement alone. Empower people you trust, who have context, to participate in an interview process.
7. Test the candidate’s true motivation
It’s very demanding to ask a senior executive to take a few days out of their presumably busy schedule to prepare notes and thoughts on a presentation in advance of your meeting with them, but it quickly weeds out people who interview well but actually don’t think well. The attendant risk is that you end up unfairly privileging or favouring people who can present a slide deck really effectively. Ex-consultants tend to be very good at this, but it doesn’t necessarily mean they’re effective executives of course.
8. Reference the heck out of them
Both formal referencing through a headhunter, but also informal referencing through back channels, every time you hear something that smells like a potential issue, dig and dig and dig. Do it tactfully. And once you hear it in one reference call, take it to your other reference calls too.
9. As a founder you should always do your own referencing
You learn far, far more from listening to the pause in someone’s answers than anything else.’
The Upscale book will be available from 27 November but you can pre-order your copy now on Amazon.