The vast amount of venture capital that’s flowing into tech startups means they’re growing fast and hiring.
That demand for talent puts candidates in an excellent position to collect job offers and make a decision that’s best for them.
"It’s an ideal time to be a tech-startup job candidate," Matt Hoffman, a partner and head of talent at venture-capital firm M13, said. "While top talent has always had their choice of roles, the job market has been completely upended over the past six months, and candidates have more opportunities and hence more power than perhaps ever before."
In the first quarter of this year, the amount of venture funding invested in startups in the US topped $64 billion, setting a new quarterly record, according to an analysis by Ernst & Young and Crunchbase, CNBC reported.
Flushed with cash, startups are now chasing candidates in a tight labor market, which gives prospective employees more leverage. But they’re not haggling with companies over compensation or perks, Hoffman said. Instead, candidates are evaluating job offers based on what they know about a company’s culture.
The most sought-after candidates are fielding multiple offers, Hoffman said, which puts pressure on companies to create "healthy and high-performing cultures" where people want to work.
"High-growth companies simply can’t differentiate on cash right now," said Hoffman, who was vice president of people at cloud-company DigitalOcean before joining M13. "They all have money to spend, and perks like free meals and yoga classes were relegated to relic status long ago. Employers now have to compete on the employee experience they offer."
Candidates are looking for alignment with a company’s culture and values, he said. They want the flexibility to work from wherever they want, after many tried remote work in lockdown and found they were just as productive. And, "most importantly," Hoffman said, candidates are seeking jobs that will grow their skills and develop their careers.
The startups that hire top talent have a "clear and compelling employer brand" that’s communicated to candidates.
Sometimes, a company’s values might not be very popular. Take Coinbase or Basecamp, whose bans on political discussions led many employees to resign and take severance packages. The key to a healthy culture is transparency and clarity, said Hoffman, adding that those two companies will continue to attract candidates who agree with their philosophies.
"The old cliche is, your values are not what you put on the wall. The values are what you do and how you behave. But in an environment where candidates have lots of choice, they know how to read Glassdoor," Hoffman said. "So the companies that are going to win in that [environment] are the authentic cultures."
The application process goes both ways.
"Candidates are interviewing companies as much as companies are interviewing candidates," he said.
Are you a startups insider with insight to share? Contact Melia Russell via email at firstname.lastname@example.org or on Signal at (603) 913-3085. Open DMs on Twitter @meliarobin.
Melia Russell June 8, 2021 at 11:12PM