... if you talk to say any of the first 40 or 50 employees, they all feel like they were a part of the founding of the company.
I believe in fighting with investors to reduce the amount of equity they get and then being as generous as you possibly can with employees.
You should be giving out a lot of equity to your employees.
The best source by far for hiring is people that you already know and people that other employees in the company already know.
One thing that founders forget is that after they hire employees, they have to retain them.
We've seen a lot of data at YC now, and the most successful companies and the ones where the investors do the best... end up giving a lot of stock out to employees- year after year after year.
Most great companies in tech have been built by personal referrals for the first...at least 100 employees and often many more.
Every first time founder waits too long, everyone hopes that an employee will turn around. But the right answer is to fire fast.
You never want to be in a place where an employee has vested 3 out of the 4 years of stock and they start thinking about leaving.
... but actually it sucks to have a lot of employees, and you should be proud of how few employees you have.
For early employees you want people that have somewhat of a risk-taking attitude.
... fire fast when it's not working. It's better for the company, it's also better for the employee.
Just put a little pin in your mind: when you cross 50 employees, there are a new set of HR rules that you have to comply with.
... you want to be proud of how much you can get done with a small numbers of employees.
You should be able to describe any employee as an animal at what they do.
Before 20 or 25 employees, most companies are structured with everyone reporting to the founder. It's totally flat.
You want to think about what is the path for my first 10 or 15 employees going to be as the company grows.
Many of the best YC companies have had phenomenally small number of employees for their first year, sometimes none besides the founders.
I think as a rough estimate, you should aim to give about 10% of the company to the first 10 employees.
When lack of structure fails, it fails all at once. What works totally fine from 0-20 employees, is disastrous at 30.
As you grow, the productivity I think, goes down with the square of the number of employees if you don't make an effort.
Companies that I've been very involved with, that have had a very bad first hire in the first 3 or so employees never recover from it.
Founders are usually very stingy with equity to employees and very generous with equity to investors. I think this is totally backwards.
You don't need to make the structure complicated, in fact you shouldn't. All you need is for every employee to know who their manager is.
AirBnB spent 5 months interviewing their first employee, before they hired someone and in their first year, they only hired 2 people.
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