Hiring is a challenge for any business. When it comes to early stage startups, this challenge is heightened by the limitations on capital and brand. To compensate for this, founders have had to draw in the best talent they could with a clear vision, all the charisma they can muster, and what skills and experience they have on hand — three things, if wielded properly, can bring together a loyal team.
The market forces underlying the halo of Chinese founders
This worked to great effect with the likes of Ele.me’s Mark (Xuhao) Zhang and Alibaba’s Jack Ma. Mark was able to rally seven of his classmates at Jiao Tong University to help him build a delivery app for free, while Jack Ma had his founding team of 18 people all working in a difficult office of around 300 sqm.
It makes for a great narrative, but there’s another factor that affects how startup teams form and grow: the market. What we’ve learned is the importance of understanding the depth of talent in a particular sector and structuring the company around that.
In the case of Jack Ma, 1999 was a critical time to introduce ecommerce, as internet platforms became more widely adopted in China. Alibaba was not his first internet company, so it helped that he could invite his former employees to join him on his next venture. For Mark Zhang, his classmates shared the same pain point as he did, and in his university there were already many startup teams working on similar projects.
In both cases, there was a clear presence of talent within the sector that had exposure to the kind of innovation these founders wanted to introduce. Even though these sectors were young at the time, these founders also had access to the talent they needed, with Jack Ma being a serial entrepreneur and Mark Zhang studying in a university that attracted students to these pursuits.
Fishing in shallow depths of Southeast Asia
On the other hand, it becomes more difficult if you’re a founder looking for solid ground in a heavily entrenched industry with low adoption of digital technology, and where the existing pool of product and business talent aren’t in the headspace for innovation. This can be the case for founders in Southeast Asia who are trying to introduce technology to traditional and secular sectors.
The ideal situation would be to attract talent that can tick both the experience box and innovation mindset box. It will be difficult to find this fit, so founders may tend to take things slowly and be meticulous in finding the gems. This approach conserves cash for hiring, but entails that each hire brings strategic value to the team. It also requires that the founders are well-versed in the space to be the best possible judge for these hires.
“Because [agritech] is a new space, I think the experience in agriculture is a lot of help but it is difficult to find people who have a deep understanding of the space and also the hunger, speed, and ambition to make things happen, as a lot of the players in this industry are traditional players,” shares Amanda. “So we do hire very slowly to find people who can adapt to a fast-paced culture, but have experience and connections in the farm side.”
Focusing on capabilities to reel in ideal talent
Most of the time a founder will have to find talent from other industries. What is key is that coming into the company they have high aptitude, a passion for the industry they are entering, and have the capacity to keep up with the company. As they settle in their role, the founder and earlier hires contribute to grooming them on what the business needs. Then as these hires become more familiar with the business, it becomes easier for the founder to pass on these hats.
Hiring outside of the industry and easing them into the business seems reactionary to the depth of talent, but it is also necessary to get the job done, as Ritase’s industry veteran co-founder and CEO Iman Kusnadi realized. Instead of focusing on experience, he looked at the capabilities Ritase would need to operate and be effective.
“For example, for an operation manager or COO, I used to think that I would simply need someone with 15 years experience running a logistics business. Now I realize that operations in Ritase run like a factory,” Iman shares in this interview. “I don’t necessarily need a logistics veteran. I need someone with factory experience, with a Kaizen, Six Sigma black belt to run operations, someone who can manage all the moving parts in a process.”
Hiring with a net of diverse talent, rather than a hook
Taking off from this capability perspective, another approach to hiring is to build the team around the capabilities of the ideal candidate, instead of looking for one. This is what cross-border logistics company Janio did to work with the shallow depths of talent in Singapore and Indonesia. Instead of fishing for the ideal hire, Janio brought together their ideal team. They cast a net with their existing team’s mix of technology talent, business acumen, and industry expertise.
“Functionally, we see this mix through our team. My teammates have twenty years in the logistics space. We complement each other. The majority of our company does not come from the logistics industry,” shares Junkai Ng, co-founder and CEO of Janio in this article, “The ones who do come from the logistics industry serve as advisors or mentors while the rest, mostly product guys and developers, have the freedom to build something they believe is valuable based on everyone’s input and feedback. They go back and forth with each other to figure out how to innovate within boundaries.”
Simply hiring isn’t enough. The company has to have an environment that supports the different kinds of hires, especially when you have industry expertise used to a certain way of doing things and technologists who want to change the way things are done.
“We are building a technology trucking company [in Vietnam]. The people who often work in the trucking industry are usually very different from the tech people. Bringing these two types of people together in company is a challenge, because one is more used to the traditional way of trucking and doing logistics and the other wants to change it,” explains Linh Pham, founder and CEO of LOGIVAN, “It is always an interesting challenge for us to create the best environment and the right combination of policies and resources to support both types of talent.”
Leveraging on competition in deeper waters
As more startups race to disrupt traditional markets, they will be faced with this constant challenge of finding and balancing experience and innovation talent. For businesses in hotter markets with more depth in talent, like ecommerce for example, it’s less a quest than it is competition for talent.
It is possible to use the presence of many competitors to one’s advantage by following talents who have performed well working with other players and are looking for a new opportunity. Of course, it is non-sequitur that any particular talent will perform the same miracles twice, but the chances are high especially if they are hungry for new challenges. Listening in to what is happening to talent in the market, especially if there are massive events like layoffs or conversely a surge in hiring notices, will be crucial in determining a specific strategy for hiring.
At the same time, hiring in hot markets also means that players need to have clearly defined vision and direction. No one will want to board the ship of a lost captain. This goes back to what Ele.me and Alibaba’s founders were able to do with their vision and determination.