Fintech · Startups

Hiring: big financial firm vs. startup?

Richard Johnson CEO of Fintech Startup

August 24th, 2015

I'm talking to someone who's a great fit for one of our positions at our fintech startup but he's only worked for big financial companies like Goldman Sachs etc and I'm worried he won't be able to make the transition from the big company infrastructure and support to a startup. Is it a good idea to take a chance and hire them given it’s fintech?

Gloria Luna VP Marketing - Brand builder and creative problem solver

August 24th, 2015

I think the critical difference between people that excel in a startup after they've worked in a big firm, is the understanding of how to execute without the intricate network of resources that exist in a big company.  I find that either you're a "roll-up-your-sleeves" person or you're not and that is critical to success in a small firm.  That would be something worth probing in the interview by exploring how they would respond in different scenarios.

Matt Cholerton Talent & People Solutions

August 26th, 2015

Chances are, if he's applying with you, he wants out of the big financial firms and wants to get into the startup scene. He wants more. He might not have dealt first hand with the breadth of challenges ahead, but I bet he'll soak it up. He'll also bring a fresh, and relevant, perspective. If you already feel he's a 'great fit', give him a chance.

Jim McClafferty Vice President of Operations at Cook Group Solutions

August 25th, 2015

I've built a successful career working at very large companies and at 1-person startups. I would hate to think how my career might have turned out if I was disqualified from an opportunity solely based on the size of my prior employers. 

Having said that, I acknowledge that not everyone can make the transition from a big company with a lot of support infrastructure and hierarchy to a small startup where you need to roll up your sleeves and get out from behind your desk. I recommend that you have a frank discussion with the candidate and express your concern. Ask him/her to describe the environment they think they are getting into if they take the job and make sure he/she can explain why they are confident they would be a fit in the environment. 

IMPORTANT: If you decide to hire him/her, make sure that you have a plan in place to help him/her transition to the new environment. It's in your best interest to help that be a successful transition rather than waiting to see if he/she is able to adjust.  

Becky Flint Product & Program Executive | Scaffold Consulting

August 24th, 2015

There are two factors to consider:
  • Roles in large companies are narrowly sliced and specialized. Many individuals don't have the opportunity & experience to run the entire function. The analogy I'd use is the bit of a screwdriver, vs. a multi-tool. You may need to assess your needs against the candidate's skillsets and experiences. I had a blog post highlighting similar challenges observed in the PMO function.
  • Enterprises provide good support in all fronts from sourcing to tools. The person in the startup will not only do a broader range of functional work, s/he will also need to build the supporting framework to operate in, e.g. deciding on software, vendor, etc.  
Both these challenges can be resolved, but it takes more effort and initiative for both the startup and the newly transitioned hire. 

Benjamin Olding Co-founder, Board Member at Jana

August 25th, 2015

If this actually is your only concern, definitely make the hire.  What's great about a concern like this is you can address it in the first 30 days of employment; this is really not a lot of risk for you or your team and finding high-quality people is hard.

There is a lot of risk to the candidate, and you'll sleep better at night if you're up front with the person right before and after you make the offer.  People who have never worked at a startup are not going to correctly understand what you possibly mean by "can't make the transition," since parsing sentence in the way you mean it requires experience in both worlds.  

So, you have to be willing to be explicit about some of the unwritten rules of a startup (like working until the job is done, never making excuses, being pro-active, getting things done on the cheap etc).  This will feel contrary to what you normally do with new employees, as culturally you don't want to be in the habit of telling people "I expect you to work XX hours this week" or "this needs to get done this week by you only and you have 0 budget to do so."  During the transition period, however, you do need to be explicit - it will feel weird.  

Start by asking them explicitly how they expect a startup to be different than their work experience, then drill down to some hard facts you're guessing they are not going to like.  If you do this, they agree to join and they can't comply (or act resentful), you should have a clear conscious when you let them go.  Actually, in my experience, if you do this and they can't make the transition, they'll quit on their own in the first 60 days; and (good news) many will actually surprise you with how easily they make the transition - to the point you might be embarrassed in retrospect how much you worried about this.

On the other hand, if this is not actually your only concern, but your way of articulating a vague problem with the candidate you can't quite put your finger on, then slow way down here.  You need to do some serious due diligence, and you need to listen to what you are both hearing and not hearing.  Do extensive reference checks and pay attention to what they don't say as well as what they do.  

If this takes too long to do this and they decide to take another position in the meantime, don't worry about it - you need to trust your instincts when something doesn't feel right but you can't articulate why.  Sometimes saying a candidate "doesn't feel startup-y enough" is just a way of saying "even though the resume looks great and I can't articulate what's wrong, I feel something is missing here."  Don't talk yourself out of this feeling: instead, research it like a madman.  You're allowed to talk to whomever you'd like: get on the phone, now.

David Still Founder of Start-ups, Entrepreneur, Financier and Advisor

August 24th, 2015

Years ago, after raising up to $250 million for a finserv startup, I hired top evp professionals from Citibank, Bank of America, First Union and Solomon to be executive managers in the startup - with equity. Not one of them could make the transition from a regulated, risk-adverse, change adverse, large institutional environment to a high growth startup environment with very aggressive institutional investors. I am not sure why, but it is a definitely a profound issue to process. 

Gisela Macedo

August 24th, 2015

I've seen this work and I strongly encourage you. I'm an example myself and I know a host of other friends that worked great. I wish you success!

Juan Zarco Managing Director, Silicon Valley Ventures Growth Partners llp

August 24th, 2015

There is a great line in "Liar's Poker", when the Managing Directors started their own firms after decades in a large investment bank, one of the foudners had to figure out how to use a calculator. SO it depends on the role, the sector, and years in the institution. An operational person might not fit well in a startup since they are used the large infrastructure. On the other hand, many investment bankers and traders really work individually and are responsible for bringing in the bacon -- a needed feature in any startup.   And if the guy did do a lot of deals, all these bankers have huge rolodexes -- that will help in further financing and M&A.  I did work in that space, merchant banking.

Adeline Ma Entrepreneur and investor

August 24th, 2015

I agree with Melissa, its good to be upfront on your concerns and that he would need to be proactive in many ways in a start up including being more independant and resourceful. 
Also I find the person's family background is importantat. I myself worked for large investment banks for many years but was able to transition to working on my own start up ventures as I was brought up with an entrepreneurial spirit -parents ran a small business and always worked for themselves. 

Kate Hiscox

August 24th, 2015

We've ran into this at Venzee.com and its a problem for sure. My COO came up with a fantastic way to tackle this and that is to have your team members look at your company's goals and have them create their own based