The Weekly: Edition #46 - May 22, 2020
Sourcing, Hiring, and Retaining Talent
Companies, at their core, are collections of talented individuals working towards achieving a common vision. Given how tumultuous the labor market has become over the past 3 months, we thought it would be helpful to share a few high level thoughts on sourcing, hiring, and retaining talent ahead of what we hope will be a robust recovery in the coming months and years. In particular, Fred Wilson from Union Square Ventures has written several pieces (linked below) on sourcing, hiring, and retaining talent.
Sourcing Talent
In order to identify potential talented individuals, Wilson recommends asking several questions of your current team:
- Who have you worked with that is talented and you would work with again?
- What companies have recently been sold where talented individuals may be looking to make a move?
- Would it be worth starting an internship program as a pipeline for potential young hires?
- What large companies exist in or around your industry space? These may be fertile grounds for hiring people ready for a more entrepreneurial role.
- Who can your investors put you in touch with in their network?
Hiring Talent
Company culture is often used as a platitude for new hires, but to retain talent long-term, it must truly infuse the work and vision of the company. While interviewing potential candidates for roles in your company, it is worth asking two questions:
- What does your company's 'culture' consist of?
- Does this individual fit within the current culture of the company?
In the same vein, it is worth regularly reviewing company culture to evaluate where the culture has strayed and whether the current team members fit into the desired ethos of your organization.
Retaining Talent
Communicate with employees. Spending time with your employees, getting to know them and helping them progress career-wise will go a long ways towards building 'thick' relationships between coworkers. Employees want to feel like the company cares about their careers and progression. This includes regular check-ins between bosses, employees and coworkers as well as all-hands and company outtings.
Create a path to promotion. Sometimes hiring senior talent from outside of your organization is simply unavoidable, but it is almost always preferable to develop talent in-house if possible. Employees want to know that their hard work and development will pay off if they persist in their current roles. Wilson also recommends assessing your team at regular intervals and providing feedback for employees' development.
Pay well. In our experience, people respond best to no-frills, no-strings-attached cash compensation. Equity can certainly be valuable and can serve as a long-term incentive, but there is no risk attached with cold hard cash.
Now we'd like to turn to the audience and ask what we missed. The team at Permanent Equity wants to hear from SMB business owners:
- What has worked well for you in the past in terms of sourcing, hiring, and retaining talent?
- What are the biggest changes you will be implementing going forward in this area?
- What have been your biggest challenges in sourcing, hiring, and retaining talent?
Strategy under uncertainty (Jerry Neumann)
+ This post illustrates how strategy planning differs between startups and mature businesses due to the inherent differences between 'uncertainty' (for startups) and 'risk' (for mature businesses).
Nearly a third of small, independent farmers are facing bankruptcy by the end of 2020, new survey says (The Counter)
+ "Where do they expect this to end? Bankruptcy, from which many will not recover. And most of the respondents are between the ages of 25 and 44, in the midst of their work lives, not toward the end. Almost a third anticipate that they will be out of business by the end of the year. If they’re right, the virus will take out much of a generation and leave the market ripe for takeover by larger operations."
Manhattan faces a reckoning if working from home becomes the norm (New York Times)
+ "Before the coronavirus crisis, three of New York City’s largest commercial tenants — Barclays, JP Morgan Chase and Morgan Stanley — had tens of thousands of workers in towers across Manhattan. Now, as the city wrestles with when and how to reopen, executives at all three firms have decided that it is highly unlikely that all their workers will ever return to those buildings. The research firm Nielsen has arrived at a similar conclusion. Even after the crisis has passed, its 3,000 workers in the city will no longer need to be in the office full-time and can instead work from home most of the week."
Doordash and pizza arbitrage (Ranjan Roy)
+ "Customers called in saying their pizza was delivered cold. Or the wrong pizza was delivered and they wanted a new pizza. Again, none of his restaurants delivered. He realized that a delivery option had mysteriously appeared on their company's Google Listing. The delivery option was created by Doordash. To confirm, he had never spoken with anyone from Doordash and after years of resisting the siren song of delivery revenue, certainly did not want to be listed. But the words "Order Delivery" were right there, prominently on the Google snippet."
People, power and technology: the 2020 Digital Attitudes Report (doteveryone)
+ "Only 19% believe tech companies are designing their products and services with their best interests in mind. Half (50%) believe it’s ‘part and parcel’ of being online that people will try to cheat or harm them in some way."
Scale and Loyalty are more important online than offline, which drives much of the “winner take most” reality of the internet (Gavin Baker)
+ This is a useful piece on how to think about your online customer acquisition costs if you are either an online business or an omnichannel business with online and offline presences.: "Finally, the fact that “CAC is the new rent” for the internet economy also advantages omnichannel players. One of the best ways to lower online CAC, especially if you don’t have scale, is to have a physical retail presence and build your brand via traditional CPM advertising, especially television advertising which is likely undervalued in todays world."
How the Passion Economy will disrupt media, education, and countless other industries (Li's Newsletter)
+ "Many successful marketplace companies in the last few decades tapped into this idea of converting non-producers into producers, in terms of making physical assets productive: Uber, for instance, unlocked the economic value of people’s idle cars, and Airbnb converted excess physical spaces into valuable assets. New sources of supply, in tandem with a latent, large pool of under-served demand, created massive economic value. While these marketplaces started by amassing supply in order to attract demand, creators often have the opposite problem: they have already aggregated demand on large social platforms, but struggle with monetization. This is where many new platforms are entering, enabling creators to overcome non-production by offering value that fans would be willing to pay for."
When “grin and bear it” isn't the right answer - and what to do instead (First Round Review)
+ "Because that’s the real challenge: deciding what our new normal is going to be and how we are going to be happy. Maybe your values have changed, maybe they haven’t. But just as we built old habits, we must build new ones. Because when we do all the things that make life worth living, it becomes worth living again. Afterall, the only reason death is so terrifying is that life really is so good. Hard, but good."
Our weird behavior during the pandemic is messing with AI models (MIT Technology Review)
+ "It took less than a week at the end of February for the top 10 Amazon search terms in multiple countries to fill up with products related to covid-19. You can track the spread of the pandemic by what we shopped for: the items peaked first in Italy, followed by Spain, France, Canada, and the US. The UK and Germany lag slightly behind. “It’s an incredible transition in the space of five days,” says Rael Cline, Nozzle’s CEO. The ripple effects have been seen across retail supply chains. But they have also affected artificial intelligence, causing hiccups for the algorithms that run behind the scenes in inventory management, fraud detection, marketing, and more. Machine-learning models trained on normal human behavior are now finding that normal has changed, and some are no longer working as they should."
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