The war to recruit the best engineers in the United States has been waging for years. There’s nothing wrong with healthy competition, but there is a problem — there aren’t enough quality prospects to fight over. Just to win a battle every now and then takes a monumental effort. Most startups don’t have a runway long enough to do recruiting right and for majority of them, building the right tech team is the difference between success and failure.
The following five facts highlight just how brutal and unsustainable the American recruiting battlefields are and why startups should look for alternative options.
What do you do when supply doesn’t meet demand? Nothing screams competition like half a million open jobs. According to Jake Rogers, a technical recruiting consultant in the Bay Area and former Head of HR at Tenor, a company that was acquired by Google earlier this year, the effort that goes into recruiting engineers is elevated every day. “You have to reach out to engineers sooner, more often, and find a way to differentiate and stand out among all the noise by pitching better and getting their attention in innovative, authentic ways. Whichever way you’re doing it, it takes more time and research which requires tools and time that end up costing more… All this and we haven’t even begun to talk about their salaries.” Most startups don’t have hiring managers dedicated to engineering. So how are they supposed to keep up in the race, especially in ultra-competitive markets like LA, NYC, and the Bay Area? “It’s like you have to run 100 miles a minute just to get a few candidates to move an inch.” For startups, there doesn’t seem to be an effective flywheel; it’s unsustainable.
That includes referrals and other sourcing methods that typically cut down on the time-to-fill. On the flipside, 43% of engineers spend less than two hours a week searching for a job. So how long does it take? That leads to our next point…
Between 2010 and 2015, the time-to-hire for all tech roles increased by 53%. (It makes one wonder if recruiting tech stacks are helping or hurting the process). Over at Sequoia, Bryan Schreier says it takes 1,000 hours to hire a team of 12 engineers. And while most startups don’t look to hire 12 engineers right out of the gate, signing even four over a two month period would require 41 extra hours a week to get the job done right.
And that sets up the biggest pitfall when recruiting engineers — lost opportunity cost for the engineering team itself. When other responsibilities of the technical leads are considered, like CTOs who are tasked with vetting and interviewing candidates that make it through an initial screen, they simply don’t have enough time. One day per week spent on recruiting and interviewing pulls them away from what they need to be working on to keep the company’s growth trajectory on track. It is clearly unsustainable, and it riddles a product roadmap with detours and delays.
This stat gives us another angle on the time commitment needed from the CTO and other engineering stakeholders. Most companies have a six to eight hour in-person interview process. It’s near impossible to balance that many interviews with other meetings and responsibilities.
Many startups turn to freelancers and contractors as an engineer stop gap because recruiting timelines are often shorter. But in hindsight, most wish they hadn’t made the investment. Satisfaction levels are sub-par and about 10% of companies go as far as to say that they are completely dissatisfied with the relationship. The bandaids don’t stick and the time-to-fill gash is one that needs to be treated before a company’s original vision and product roadmap lead to its demise.
Helping startups avoid these deadly recruiting pitfalls is one of the main reasons we started Terminal, and it’s one of the secrets to success behind the booming businesses now partnered with Terminal. For example, hims, one of the fastest growing men’s health brand’s in the world, was able to recruit engineers at a pace twice the national average. Once partnered with Terminal, hims could build its backend systems quickly and keep their eyes focused on executing a successful go-to-market strategy. “Each member of our leadership team owns several essential projects,” says Chief Product and Operations Officer, Melissa Baird. “If our VP of Technology or another team member has to set aside what they are doing to recruit, hire, and train new team members, then we’d be months behind schedule.” For startups like hims, it’s about the money and opportunity costs saved by cutting that time in half.
If startups want not only to survive but to thrive, they need to look for creative, cost-effective solutions to shorten the engineer recruiting process. For some, this could mean adding another hiring manager to the payroll. But again, that would only solve the sourcing issue. Hands down, the best, most sustainable and cost effective response is outside help.
At Terminal, we offer startups an efficient service to create world-class technical teams through remote operations — a complete solution that delivers push-button recruiting, operations, workspace development, human resources, and professional learning and development programs so that you can innovate faster. Learn more here.