Since taking over the Founders’ Network programme back in March, I’ve regularly heard from founders about how they struggle to find the right talent to grow their businesses.
The North is a fantastic place to launch and grow a business, with its entrepreneurial talent, grit and determination. We have had some amazing high-growth companies, as well as a thriving community of small digital businesses. But recruitment is a serious challenge.
So, we decided to interview founders at the forefront of this problem to get their views on how best to find talent to grow your startup and give you some ideas on how to do it.
We were joined by:
- Paul Lancaster from Plan Digital, which offers business development and inbound marketing solutions for startups and SMEs and is Founder & Event Producer of the Newcastle Startup Week festival and Newcastle Scaleup Summit.
- Michaela Reaney from Gradvert; a recruitment solutions company specialising in sourcing graduate talent and leadership management training.
- James Hanson from Layers Studio, a branding studio that creates valuable interaction between brands and their audience
- Holly Thompson from Future Skills Vision who work with organisations to meet their learning & development needs through a mixture of talent sourcing, retraining and advisory services.
One of the biggest lessons that came out of our discussion was that there is a disparity between what students leaving education have learnt and the actual needs of businesses.
Future Skills Vision and Gradvert are actively working with colleges and universities in the North East to tackle this problem, with Gradvert providing an accelerator style programme to equip graduates with the right skills to enter today’s workforce. They work with businesses from the CEO down to the new graduate hire and providing training and development to ensure that staff skills are up to date for this ever changing start-up world.
Q. How organisations can attract talent into their business
Michaela: Corporates naturally have a bigger brand and presence amongst students. They have a bigger budget with which to attract talent and therefore startups need to think of more innovative and creative ways to get their brand known to potential hires. If potential hires don’t know who you are then they can’t apply for your vacancies.
We run #Gradshour on Twitter, which is the UK’s only networking hour for businesses and students to interact and engage with each other. It’s completely free to participate in and runs every Wednesday, 2-3pm and gives businesses the opportunity to get their brand out there and talk to potential hires. It’s used by the likes of L’Oreal all the way through to smaller SMEs and startups.
Recruiters can sometimes want 10-20 percent commission when securing new talent which is out of the budget of most startup founders. Are there any other tips you have for founders looking to hire talent?
Michaela: A couple of things. Firstly it’s about how you rate yourself against other organisations who are looking for that exact talent. What behaviours and skills are you looking for from that next hire, but also as a business, what can you offer them that your competition can’t? Once you have that worked out, start using online platforms to post job adverts and network with universities and colleges by speaking directly with module leaders and the Careers Service about what talent is coming out of their organisation and start building those relationships.
Again looking at more cost effective ways to advertise other than using recruitment agencies such as word of mouth and looking through LinkedIn. The biggest thing to think about though is what you can offer a potential hire that is different from your competition and hopefully more appealing.
Holly: I set up Future Skills Vision just over a year ago and focused on helping companies take advantage of the funding available such as The Apprenticeship Levy to help grow and retrain the talent in their business but also to bridge the gap between employers and education providers. Future Skills Vision looks at how the businesses can find talent at all levels including apprentices, interns, graduates and retraining existing staff to really grow their business.
Q: Future Skills Vision has a really interesting recruitment model and you have a mixture of hires including full-time permanent staff, interns, apprentices but also working with Associates to drive your business forward rather taking the approach of hiring a full time member of staff for each service I provide.
Can you tell us a bit more about why you decided to do that and how you implemented it?
Holly: I already had some knowledge about how the different types of employment worked and how each could be used to drive my business forward, which did give me a bit of an advantage, but I wanted Future Skills Vision to be unique and really to show we practise what we preach and promote collaboration between different hiring models.
So ultimately the question I wanted to answer was “How as a small business, can I get access to talent and staff to drive my business forward?”. When you decide to start a business, for most, you don’t have a ready access of cash to hire people so by using a mixture of job contracts such as apprentices, associates and intern staff, you can use their expertise as and when you need them giving you a breadth and depth of skills and not have that overheads that you would usually have with permanent staff.
What I have found is that more and more people are looking for that portfolio career especially in those high-value subject areas such as tech, and people are wanting more flexibility in how they work. Ultimately we’ve grown by hiring a combination of full time staff, interns, apprentices and collaborating with associates. Our growth is definitely down to our people, we’ve been able to pick the right people for our business and who buy into our vision.
Having people who buy into your vision is incredibly important and picking the people who buy into your vision and then working with them to build them into your company’s vision. Using this model has enabled us to go from a startup to a scaleup in just over a year, with over 50 clients in the North East and growing rapidly across the rest of the North as well. It’s allowed us to be adaptable to the changing nature of running a startup and is one of the key drivers of our success.
James: I got started with Layers Studio and was joined by my co-founder, Andrew, six months later. We worked together to recruit our first hire, Chris, who is our developer and has 15 years’ experience working in different agencies.
This was a really important hire for us and we needed to make sure that we hired the right person. I’d already had a list of people that I thought would be really good to work in our business but when we started to interview, they were saying to me that they weren’t right for the job. We were very open about what we wanted to do and how we wanted to achieve it and for some people, this wasn’t how they wanted to work and therefore they wouldn’t have been right for the business.
What we look for in our hires is that these people could effectively do this role themselves but they would rather work with us and be part of our team, and some of the people we interviewed needed more support than what we were offering at the time. The key for us with our first hire was using a lot of referrals as we didn’t have anyone to hire within our networks.
We did use recruitment agencies but we knew it was key to hire the right person with the right skills and that fitted into our culture, and we ended asking a lot of the people who we work with for referrals and got feedback on the potential hires from people who has worked with them. We hired correctly because of the approach we took, rather than just hiring a developer and taking the approach of ‘hire slow and fire fast.’ We’ve been really lucky with Chris as our first hire and I believe this is down to the fact that we took our time during the hiring process.
Q: Everyone wants to know how to hire a great developer so what did you do to attract Chris to Layers Studio? Obviously across the North we have some really big, attractive tech companies and a lot of our members say they just can’t compete of wages to attract talent.
James: Salaries are crazy for developers at the moment, and it’s true that we can’t compete on wages alone so we have to offer the whole experience of working for a startup that you don’t get at a corporate. So for instance, we offer remote working opportunities. We offer our staff autonomy and I think that is a really big advantage; personal satisfaction from feeling like you have an impact in your company is massive and it’s very hard to get that feeling in a big company.
It’s not impossible, and making sure that everyone is aware of your vision no matter how big the company is helps but it’s not the same as working for a small startup. We said from day one that we wanted people to be autonomous and responsible for their own work and therefore work their own time.
I read a great article called Hiring Adults, and it’s about treating your staff like adults. So for example, some companies say that they don’t know if their staff or working if they work from home. If you’re worried about them not doing work, why have you hired them?
Also, ensuring that person has real decision making power in their project is also a way to distinguish yourself from other businesses. Being able to manage their own time, work from home, have a direct impact on the business, flexible time-scales and just generally being in charge of their own workload. There are obviously other perks as well but I think those are the sorts of things that we offer as a business and for us, we hire people who want those things as well.
We also work in Campus North and the community in there is another perk to working with us as you get to meet lots of other startups, talk to developers working on different projects and really feel involved in the community. Obviously salary wise, you have to be competitive but being able to offer other perks that corporates can’t can definitively be attractive to the sorts of people you want to hire.
Q. Based on what James has just mentioned, is there a difference to what graduates are wanting now compared to even a few years ago where most graduates wanted the high salaries but were prepared to be chained to a desk for 16 hours a day. Are our new graduates wanting something different?
Michaela: I think the expectations and demands of employees are changing across the board and not just at the millennial stages. One of the biggest drivers for people coming out of education is about what opportunities are there to grow and develop, both professionally and personally.
Salary is still important but it now ranks third in research from the Institute of Student Employers. We are seeing that shift and I think that is where the startup and SME has that edge in attracting talent as someone coming in can relatively quickly progress through that organisation because you don’t have the several layers of management to get through and you can almost see the opportunities available to you.
In that respect, you are able to shape your own position within that startup organisation which might be more challenging in a corporate environment. Another change we are seeing is around social mobility, especially around the point of flexible working. Some people want to work even remotely from the rest of their team and not be in the office day in, day out.
Values are another important factor, and graduates are now asking if a company ‘has the same values as me.’ And we are now seeing a shift from the model of the late 1990s/early 2000s where graduates would stay two years and then move on, to them now actually wanting to grow with an organisation and wanting that support system around them and feeling part of the team.
It can be difficult from startups and SMEs to provide that support system for apprentices or graduate hires and that network to help them develop. One of the things your members may be interested in is what Dynamo is doing in the North East. Dynamo is a collective of tech companies in the North East from your corporate brands to your startups and SMEs and one of the things they are doing is looking at the recruitment process that Sage are using.
High volumes of people apply to their vacancies, between 600 and 650 a year, and they are only placing between 35 to 50 of those in actual jobs. So what Gradvert is now doing is putting together a programme which takes those 600 or so who weren’t successful at Sage, and creating a pipeline of talent through to SMEs and startups in the region, who would otherwise find it challenging to compete with these larger corporates and be able to attract that talent in.
Gradvert will be creating a hub where SMEs and Startups can join and be part of, and this will reduce a huge amount on recruitment costs and time and also attract talent who have at that point gone through quite a rigorous and robust recruitment process and put those individuals into the North East’s digital and tech SMEs and startups. It’s a great way to keep talent in the region and not lose them and provide a programme which SMEs and Startups can access.
Q. So actually, it looks like being a startup should be seen as being a perk rather than a drawback to recruiting talent, as startups are more agile and can provide perks that corporates can’t.
And it sounds as though startups can have the conversation of “we like you, how do you want to work together” rather than unlike the corporates who have to say “this is the contract you work to.”
Michaela: And the decision-making process for startups is a lot shorter than corporates as well because you don’t have lots of layers to get through for things to be signed off. Startups can respond to things a lot quicker. It’s also not a buyer’s market out there.
Yes, there are skills shortages out there in certain areas but it is also about assessing what is the right talent for your business and then looking specifically for those people instead of doing lots of expensive careers fairs or recruitment agencies.
Q. So, onto our final question. We often get told by startups and SMEs that hiring apprentices and graduates can be time consuming as they often don’t come into the workforce with the soft, everyday skills that employers need and that they then have to spend time and resources training them up.
What is your response to this and have you got any tips on how to make this process easier for startups?
Holly: Apprentices and graduates do need that extra time to teach and nurture their talent, but in return, by spending that time on new talent and showing them what their career path could look like, you are potentially getting someone who can learn pretty fast on the job but will also become an incredibly loyal member of staff to your organisation. That is just something you can’t buy in.
Investing in your staff and treating them well will lead to them being loyal to your business. And actually it doesn’t have to be scary hiring in someone who is new to the workforce. Some of the work that Future Skills Vision does, is hold organisations’ hands while they go through that process such as providing Learning and Development packages that help you train those first hires but also provides the help and support to the business owner, who may never have hired anyone before or hired someone new to the workforce.
Making sure that both parties are comfortable with the hiring and onboarding process is incredibly important to ensuring the hire is successful.
James: It’s interesting because these sentiments are echoed a lot in the design community as well. I’ve been working recently with Newcastle College and putting together course leaders and industry to be able to build a course that factors in experience and working with local design agencies to see how they operate.
Also, when you hire experienced talent, they may work in a way that is not right for your agency and they may have just as much if not more of a struggle to change their work behaviour than hiring someone who is fresh and keen to learn how your company operates, they’ll absorb the things you are doing and do things your way.
Hiring new talent into your business should be seen as a benefit as you may have to spend the time on retraining anyway.
Michaela: I think it’s really positive to bring young people into your organisation and create an environment for innovation, a place for new thinking and ideas, and you can also help that individual launch their career which from a personal perspective can be incredibly rewarding.
How you go about it can be challenging but as long as it is thought through and there is a strategy in place, then you can ensure that when that person does start, there are procedures in place to ensure that new hire has support from the business.
More often than not, people will often leave because they don’t have that support in place to help them progress and develop. This isn’t just the responsibility of the business owner but the wider team in general. From the professional skills perspective, Gradvert works with universities, colleges and some schools to help them around the employability agenda to help schools create those ‘right behaviours’ that will help them be successful in the work force.
I actually think by bringing in younger talent, it enables a startup to scale more quickly, as it is more cost effective as they don’t demand the same sorts of salaries as experienced hires but the benefits and value you can get as an organisation is exceptional.
Paul: I used to work for Sage and even they struggle to attract talent, as not everyone wants to work for a big corporate. Even things like a corporate being based outside of the city centre can be unattractive to certain people, as they want to work in the city centre, or experienced hires who have got to the top of their game in that corporate and are now looking to join a second tier company because they want that challenge of helping that business grow. Not everyone wants to work for a massive company.
Another things is around visibility of your startup as a potential recruiter. Raising your profile as a company is a really good way to attract talent, as if people don’t know about you, they aren’t going to look on your website for vacancies.
Sponsoring relevant events is a really great way of getting your name out there, or speaking at events and conferences. Holly has recently sponsored a Campus North event and Michaela, James and Holly are all speakers for our Newcastle Startup Week festival and Newcastle Scaleup Summit. You can’t think “why isn’t the talent coming to me”, you have to go out there and network and in effect market your business as a recruiter just as much as you market your service or product to potential buyers.
Go to meetups, sponsor events and get out there networking and if there isn’t a networking event that is relevant to your niche, create one and become an influencer in your city/area.
Newcastle Scaleup Summit is going into more detail about some of the topics we discussed at Startup Week and talk about how to take your business to the next level whether that is recruitment, funding or just to give you ideas of how to grow.
Other topics include how to do better sales and marketing, innovation and development of new products and services, improving internal processes and how to incentivise your staff. Its promises to be a really great event on the 23rd of November in Newcastle.
Founders’ Network members get an exclusive discount code for the Newcastle Scaleup Summit, which they can find by logging into the offers page using their login details.
- Use the fact you’re a startup to your benefit. Offer perks and opportunities that corporates and larger businesses can’t
- Work with colleges and universities to get your name out there and network on #gradhour
- Put processes in place for new inexperienced hires to ensure that everyone is nurtured and able to grow within the business
- Sponsor events and go to meetups to meet potential hires
- Have a clear vision, and hire slow but fire fast