This is one post/chapter in a serialized book called Startup 101. For the introduction and table of contents, please click here.

In How to Be an Effective CEO, we noted three things that a CEO has to do. One of them is to hire and fire a top management team. One of the simplest rules to understand is:

Hire an A-Team and it will hire an A-Team. Hire a B-Team and it will hire a C-Team.

This is simple to understand but hard to execute.

Integrity

Here is a bit of timeless wisdom from Warren Buffet. He advises that, when hiring, look for brains, energy, and integrity. But if the people you find don't have integrity, the other two qualities will kill you.

10 Tips for Hiring an A-Team

  1. Don't be afraid to hire people who are smarter than you.
    That is harder to do than to say. You need a lot of innate confidence to do this. Hiring someone for a technical competency that you lack is easy. Hiring someone who will challenge your thinking on every level and may later go on to build a business much more successful than yours is harder.
  2. Hire athletes.
    They have energy, know how to endure pain to get results, and like to win.
  3. Focus hard on building a win/win compensation plan.
    That is, a win for the company and a win for the employee. This is also hard to do right. Even good compensation plans get gamed, which is why Buffet's advice about integrity is so critical. Be generous... but also demanding (see #5).
  4. Take the time you need.
    Hiring is your most important job. Take the time to interview a lot of candidates; cast a wide net. Spend a lot of face-to-face time with the candidates on your short list. Do real reference checks, ideally face to face. Meet their family and friends socially. As a side benefit, interviewing a ton of smart people is a great way to learn more about your market.
  5. Be demanding.
    Find people who want to achieve ambitious goals, spend time setting metrics, and then hold them accountable to them.
  6. Be honest and transparent.
    You cannot expect integrity from others unless you show it yourself. And you can't fake it either, not with members of an A-Team. They will be too smart for B.S.
  7. Listen.
    Just as listening is the key to selling, it is also the key to recruiting.
  8. Establish techniques and tests specific to the position.
    What is useful for a developer is not useful for a salesperson, and vice versa.
  9. Get a second opinion.
    This second opinion could come from someone internal (another manager) or someone external (an advisor). Assume that recruiters have a vested interest in closing, so take what they say with a grain of salt.
  10. Don't just "fill a position."
    That is not a meaningful milestone. It may allow you to check that box, but it will create 10 more boxes to check if you get it wrong. Don't be afraid to delay until you get the best possible person.