What is the right title for our startup's first employee leading business development?

Anonymous

November 6th, 2015

We are a tech startup serving the mortgage industry. Our first non-founding full time employee (still equity only, pre-funding) has come on board to lead biz dev. I see a lot of title inflation in banking so I'm in favor of VP Business Development as a title for him. My cofounder thinks that we should avoid titles for employees to keep the startup org flat. She is pushing for Director of BD, or perhaps none. Since we sell software to banks, everyone has VP or above title. Is it a mistake to start him at VP of BD? His last role at a big four firm was Manager. The employee wants the VP title and I don't really mind either way. Should I care more?

Do people even see VP as higher than Director or the other way around? A quick search for VP of BD yields ~1300 hits on FD vs ~6500 hits for Dir of BD so the latter is more common, at least in this community! Thoughts? I just want to do what's best for business.

Anonymous

November 6th, 2015

interesting.

Internally, I would go with Director. VP is somebody almost CXO but not completely. I agree with your cofounder that this early titles are meaningless and if somebody cares about that he/she might not be a great fit for a startup.

However, in your specific field titles might mean something completely different and for such an external position I can see you compare yourself with other companies in your space.

Larry Megugorac Custom Components ⇨ Custom Parts ⇨ Assemblies

November 6th, 2015

Well my saying has always been....You can't take titles to the bank...but a VP designation might help him get into to see people that maybe a Director title would not....that's the only benefit I see. Of course everyone wants to feel important and that's what the VP title can do. Is he a VP caliber guy?

If business development is his job, he has to have a title if for no other reason to state his responsibility on his business card for the folks he intends on calling on.

Paul Murskov

November 6th, 2015

We recruit for sales and biz dev for startups and I can tell you that VP definitely stands above Director in terms of title as seen from the outside. If your cofounder wants to avoid titles to keep the org flat then making him a Director would go against that mentality. You would have to call him simply "Business Development" to keep the org flat - which we see quite a bit as well.

One thing some startups do is hire for a Director title first to create a career path for the person they are bringing in to be promoted into that VP role if they are successful. If the person wants the title - you can spin it to say that if they are successful after year 1 they can earn a VP title that comes with a comp bump of some kind. Creating that kind of carrot could be very lucrative.

In most startups that scale BD the org title structure can look similar to this in terms of title rollup:

CRO (Chief Revenue Officer) - Responsible for all revenue / operations

Head of BD - Responsible for all BD efforts and operations

SVP of BD - Senior VP reporting into the Head of BD or CRO

VP of BD - reporting to the SVP

Director of BD- reporting into to VP

BD Manager - reporting to VP

Business Development Rep - AE that reports to Manager

Hope this helps!

Paul

5 * Agents for a TV Channel Franchise

November 7th, 2015

Within the British Business Systems VP stand for Vice President and would definitely not be the correct title. Only a large Corporation,not a startup would have a President & Vice President,and then usually when a full table of 12 Directors have been seated. The other Positions would be C.E.O Treasurer,Chairman,and Corporate Secretary. Small Private Companies over here often arrive at Managing Director & Directors,with employee titles,to match each career description. If the Employee was not a Director then the term Marketing Executive e.g. would be incorrect. Other titles such as Marketing Manager,Senior Marketing Manager,also seemly conservative are also acceptable. The only point im making really is for integrities sake, unless Your employee is actually registered as an enrolled Company Director,then you can call him a Director of anything or a VP,unless he is a Film Director.

Rob G

November 7th, 2015

is this person's role sales or business development? The trend of calling sales 'business development' is ridiculous IMO, especially so if you will eventually have both. Sales is sales, business development is business development. If one is embarrassed to call oneself a sales person or sales manager or VP of sales or Executive VP of sales, or Chief Revenue Officer then perhaps they should find a new profession. As for title, in the US VP is generally considered a 'higher' position than director. Though there are not hard and fast rules, a common progression in the US is: manager, group mgr., Director, Sr. Dir, GM, VP, Sr. VP, Executive VP, CXO. Chief Revenue Officer would cover all things revenue (sales and BD and sometime marketing).

Benjamin Olding Co-founder, Board Member at Jana

November 8th, 2015

I always felt Google ingeneously solved this problem by making the title "head of [blank]" below director in the management structure (not above, as someone listed earlier). I find "head" to be meaningless internally, but externally people seem to take it very seriously.

Anyway, I'd recommend "head of business development" as an accurate description (they are the only bd person) that still leaves you plenty of room to hire more & less senior people later without having to worry about the awkwardness of title changes vs title inflation.

Also make sure you hire people who aren't joining for the title.