Every successful startup founder knows this to be true: your people determine your company’s future (or, real talk, your lack thereof). Hiring and retaining excellent talent is critical, including your marketing team.
A premier marketing team will help you identify and connect with your target audience, differentiate your business from the competition, and establish your startup and you, the founder, as industry authorities. With 90% of startups failing and 10% shutting their doors within the first year, building your company’s reputation is essential to convert leads to sales and bring in essential revenue. That’s where a strong marketing team becomes indispensable.
However, many founders need help to get marketing right; 22% of startups fail due to a lack of a sound marketing strategy. As more founders understand the crucial role marketing plays in their success, they’re swiftly hiring to fill different positions.
Finding high-caliber talent, however, often requires a considerable amount of time and resources, two luxuries start-ups simply don’t have. In a race to get off the starting block and show returns to investors, startups move at breakneck speed, often resulting in hasty and ineffective hiring. While founders may save money in the short term, failing to budget appropriately and hire the right people at the right time will cost them significantly down the line.
In fact, the US Department of Labor equates the cost of a bad hire to up to 30% of that hire’s first-year wages. So, if a far-from-stellar hire makes $80,000 annually, you may be looking at financial losses totaling $24,000. And it’s not only the financial loss. A bad hire can slow a founder down, cause distraction, and may prevent your company from moving forward.
Before sharing how founders can get hiring right, let’s dig into where it tends to go wrong so you can identify these red flags and put your startup on a path to success.
The #1 Hiring Snafu Founders Should Avoid
Founders tend to make the same mistake at their company’s onset; they hire a relatively junior, generalist marketer to handle literally everything remotely related to marketing.
Founders, from the onset have (probably inadvertently) created the impression within their organization that marketing’s role is activity-driven and/or a tactically-centered discipline from the jump. In fact, marketing is likely supporting basic company creation, not building a growth engine. How does this play out?
These early individuals may build compelling blog posts, witty social copy, and a spiffy-looking website, but they’re not grounded in a strategy that informs what they’re doing and how they’re ultimately building value creation for your company and customers. In many cases, they do not have a clear idea of what the product is or who your customer is, and none of their work will contribute to the founder’s understanding of how marketing can impact CAC, LTV, NRR, etc.
Fast forward a couple of years to the Series C stage. Founders are typically recruiting a heavy-hitter CMO to vastly accelerate the business towards exit or IPO. And unfortunately, by this stage, marketing is typically viewed somewhere in the spectrum of ‘trash and trinkets’ to ‘prove it’. There’s a reason the failure rate for startup CMOs is exceptionally high; you can usually look all the way back to the days of those early marketing hires and activities for clues why.
So the CMO has started, but what is their remit? The marketing foundations are not there, and they’re left dealing with Frankensteined team, website, and technology in addition to disparate data and a nonexistent or misaligned GTM relationship between marketing, sales, and product. There’s very little art and very little science; rather, CMOs have a legacy to overcome while building internal trust, upskilling talent, developing and implementing strategic plans, executing flawlessly, and showing immediate impact.
So this leader must “change the plumbing while the faucets are running”. They have to build the right foundations: everything from defining the ideal buyer to conducting competitive assessments to setting benchmark metrics to gauging campaigns’ success. Their team is a mix of those who have been with the company since the early days to relatively new specialists who are trying to unravel years of disparate strategies and programs.
At the same time, senior leadership and investors grow increasingly frustrated with the delay in seeing results. This misalignment in expectations results in internal friction and an ineffective marketing team. Senior hires switch out; rinse, repeat.
Avoid the Rabbit Hole with Expert Guidance
Working in the startup space for more than a decade, we’ve seen variations of this scenario play out time and time again. The good news? You can avoid the chaos by hiring the right people at the right time.
Even better news, our CEO and Founder, Mack McKelvey, developed a framework for what precisely that entails in our Fast Company series. In these articles, Mack outlines who founders should hire at each stage, what critical criteria determines successful candidates, and how these roles will put your startup in a position to scale.
For early-stage founders, for example, they’re laser-focused on showing product-market fit (PMF) as fast as possible. PMF is critical as 34% of failed small businesses don’t have the proper product-market fit. Founders can get their hands on a golden ticket to positioning their startup for PMF by hiring a product marketer (PMM). To say that your PMM is focused on PMF is an understatement; they obsess over it. A technical marketer at their core, your PMM deeply understands your product or solution, its current and future functional capabilities, the market it serves, and how it explicitly solves a customer problem.
Check out our first Fast Company article, where Mack defines what constitutes a strong PMM, their primary responsibilities, how they work effectively with founders, and how they’re essential to scaling your business for that next funding round.
This first marketing hire will more than pay off once you get to Series A. And what’s your next hire after you’re there? Stay tuned for our next article on hiring tips for Series A founders and how the right team will get you to that much-coveted Series B.