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🧰 Venture Tools #005
The Worst Hires are the Hardest Workers
Prelude - this newsletter has grown 30% in the past week 👀 (who knew LinkedIn would be the best distribution channel?) I’m keen to understand a bit more about you, so appreciate you answering this poll and also replying with any particular type of content you’d like to see going forward.
💡Insight - The worst hires are the hardest workers
At my first company I hired one of the hardest working people I have ever worked with.
A true machine. He would regularly work 16 hour days (unsolicited).
He was the first to volunteer to help solve a problem.
He was the first to offer to help other team members.
He embodied all of the cultural behaviours we had established as company. There was just one problem: he was not cognitively capable of completing his work responsibilities to the right level. I would frequently have to take over his work or micro-manage to get work done at the right quality.
He quickly became frustrated. Other team members who were working far fewer hours were getting promoted and given more responsibility. This frustration eventually boiled over into a toxic attitude towards his team mates and the company and ultimately we had to make the tough decision to let him go. (As a reminder all hires you make that don’t work out are your responsibility as a founder, not the team member’s fault).
The worst hires you make aren’t those who are lazy and smart.
The worst hires you’ll make are those who work harder than anyone else, but simply aren’t smart enough for the role. They’ll burn themselves out and also potentially create a toxic culture for the rest of the team.
As we discussed in last week’s edition - culture is king and the bedrock of building the most important process in every company - the hiring process.
As a part of your hiring process you should include some standardised testing for cognitive ability. Aside from it being correlated with career success (and therefore your company’s success) it will help avoid a potentially toxic hire.
I personally use Test Gorilla for these tests (and generally for managing each stage of the hiring process) and would highly recommend them.
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The Network Effects Masterclass - 11 free videos from the NFX team on network effects including case studies from Meta, Uber, Bitcoin and Trulia. A worthwhile watch for investors and founders.
The Best Approach to the Worst Conversation: ‘You’re Fired’ - how to handle layoffs from the team at First Round.
13 Research Papers Every VC Should Know - from the team at OpenVC.
How to Hire your First Engineer - from Y-Combinator & Harj Taggar.
Developing a growth model & marketplace growth strategy - from Dan Hockenmaier of Faire & Thumbtack.
Aydin Senkut of Felicis Ventures on Angel to 9 time Midas list investor, inception to scale at Felicis, and winning in today's crowded market - podcast with Samir Kaji and Venture Unlocked.
Venture Capital Jobs and Career Resources (2022 edition) by John Gannon
Age and High Growth Entrepreneurship - study demonstrates that the older you are, the more likely you are to succeed as a startup founder (until you reach ~60). Are VCs missing out with the focus on youth?
Employers shouldn’t discourage side hustles - ‘they’re a source of energy and empowerment. After engaging evenings on their side gigs people perform better the next day in their full-time job’
The Emerging Manager Toolkit Part II: Tech Stack - the team at Cocoa outline their tech stack for operating their fund.
Thank you for reading. Feedback is always welcome. Have an awesome week 🤌