A REFERENCE GUIDE FOR BUILDING YOUR HR FUNCTION
Last year, we launched our start-up recruiter survey, geared at learning how recruiters meet the hiring demands of growing companies. This year, we once again asked questions about the makeup of the recruiting team as well as how the hiring process was structured. We also added a new section on HR practices - asking about surveys, performance, HR tools, and compensation.
Recruiters from over 40 start-ups participated in the survey. These companies ranged in size from under 50 to over 500 employees and came from cities across the US (though the majority - about 75% - are based in New York).
We turned the results into a guide to help start-ups build out their people practices. Here’s what we learned:
Building a Recruiting Team
Hiring the first recruiter - how much experience do start-up recruiters typically have? As with last year’s findings, recruiters at start-ups are generally not new to the field; 65% had more than six years of recruiting experience, and 27% had 10 or more. Only 10% had fewer than 2 years of recruiting experience. Making sure you hire a recruiter with a solid amount of experience is a sound idea - it’s not an easy job!
When start-ups add the second recruiter. Most start-ups add a second or third recruiter after 50 employees, and all companies over 200 employees had at least 2-3 recruiters. Those with more than 500 employees had at least 4-5 (with 60% reporting 6 or more recruiters).
When to add recruiting coordinator support. At under 50 employees, most recruiters reported doing all the scheduling themselves. From 51-100 employees, some teams had recruiting coordinators but many were still getting help from an administrative employee in the company (but not a designated recruiting coordinator), which suggests that companies may need this role sooner than they think. At the 100 employee mark, half reported having a designated recruiting coordinator and after 150 employees, it was unusual for a company to not have this support role. At the 300 employee mark, there were at least 2-3 coordinators, if not 4 or more. This suggests that if you’re growing quickly, you may want to open that recruiting coordinator job before you get to 100 employees (and if you’re growing very quickly, even sooner!).
Recruiting Team Expectations
How many roles should a recruiter handle at one time? From the graph below, the majority of recruiters reported being responsible for 6-10 roles or 11-20 at any given time. Having more than 20 open jobs at one time was unusual (less than 10% of recruiters).
This information can also help guide the ‘when to add a second recruiter’ question from above - if you’re a growing company that anticipates that there will be 20+ roles open at your company at any given time, it may be the right time to add a second recruiter.
In addition, the types of roles being recruited for matter as well. Those reporting that they were primarily responsible for engineering and product roles reported being responsible for fewer requisitions than those recruiting for other roles. Nearly 70% of tech recruiters were responsible for 10 or fewer roles, and 25% reported working on fewer than 5 at any given time. Interestingly, 100% of the tech recruiters responsible for more than 10 roles at at time reported having recruiting coordinator support, suggesting that you can offset a slightly higher workload if there is a support role in place.
How long does it take to fill a role? Recruiters in our survey reported taking mostly between 1-2 months to fill a role. This fits with what we’ve seen at our clients and other places we’ve worked, where the average time to fill is usually somewhere around 50 days (from the time a job opens until the offer is accepted).
How many hires are made per month? Recruiters generally reported making 5 or fewer hires per month (80%). As with the number of open roles, the type of job matters as well - 80% of tech recruiters reported 3 or fewer hires per month, while 90% of those recruiting for non-tech roles made 4 or more.
How many interviews before a candidate gets an offer? Thankfully, 97% of recruiters responded that fewer than 10 people interview a candidate before they get to offer stage (that includes the recruiter interview). That said, it looks like there tends to be ‘interviewer creep’ as a company grows; the larger the company, the more likely recruiters were to report a higher number of interviews before getting to an offer.
While we understand that there may be situations where it makes sense to have more people weigh in on a candidate, putting a ceiling on the number of interviews a candidate has to go through will keep your process efficient and ensure your candidate has a positive experience.
Is structured interviewing a standard practice? ‘Structured interviewing’ refers to whether a company uses consistent questions and topics across interviews (compared to letting an interviewer ‘wing it’ or ask questions like what type of tree they are). In our survey, 83% of start-up recruiters reported that they used structured interviews. This is even higher than last year, where 71% of recruiters reported the same. Overall, structured interviewing helps find the best fits for your open jobs and reduces bias in your hiring process.
What about skills tests? Having a candidate complete a skills test during the interview process (before or during in-person interviews) has also become a common practice among start-ups - only 12% of recruiters reported not using any sort of skills test during the interview process. However, the majority of skills tests are engineering based, with very few companies reporting that it is a practice across all job functions -
Do interviewers score candidates? Interview scoring is also regularly used at start-ups. Only 12% of recruiters responded that there is no formal interview scoring (these were not the same 12% from skills-test group). The majority (59%) reported that they use a simple 2-point scale (a simple ‘thumbs up’ or ‘thumbs down’), while 30% reported using either a 4-point or 5-point scale.
What applicant tracking system do start-ups use? As with last year’s results, Greenhouse takes the cake as the ATS most used by the recruiters in our survey.
What are the most common sources of hire for start-ups? When it comes to where recruiters get their hires, the most common sources are employee referrals, direct reach outs, and inbound applicants.
Employee referrals were the most popular source of hire last year as well. If you would like some tips on referral programs, we’ve got you covered - check out our post from earlier this year.
What are the go-to sourcing platforms for recruiting candidates? LinkedIn was far and away the most common recruitment tool, with 85% of recruiters putting it in their top 3. Below is a graph showing the platforms that were used by at least 10% of recruiters -
Building diversity into your recruiting practice. With the emphasis on the importance of employee diversity in the news this year (in addition to being important in general), we were hoping to see an increase in the number of start-ups reporting that they built diversity practices into their hiring process. However, this graph remains relatively unchanged from last year -
If you’re interested in some steps you can take, here’s a pretty comprehensive guide to get you started, provided by the VC firm Homebrew.
Building out your HR Practice
When do I move from a PEO to HRIS? In our survey, the switch to standalone HRIS solutions picks up around 100 employees, and no companies reported using a PEO after about 200 employees. The HRIS’ systems used by start-ups varied widely, but the most common ones in the survey were Namely, ADP, BambooHR and Workday (the latter was only reported for companies over 500 employees).
Conducting employee surveys. Employee engagement surveys were relatively popular among start-ups - 78% of recruiters reported that their companies used them. The usage of them did not depend on company size, which suggests that engagement surveys are a decision made by leadership to learn about their organization rather than a function of growth. The most popular tools among our respondents were SurveyMonkey, CultureAmp, and Google Forms.
Do start-ups use market compensation data? Most start-ups in our survey reported using external market data to benchmark their salaries - 68% reported using a compensation consultant and/or market survey data, and only 15% reported that they did not use any at all. The remainder were unsure whether external market data or consultants had been used.
How often is employee performance reviewed? Start-ups in our survey reported that employee performance was formally evaluated most commonly on an annual or bi-annual basis. Only 12% of companies reported not having any formal performance review.
What about performance scores? The debate of “should we have performance ratings?” continues. Half of respondents reported that they used performance scores (with five- and four- point scales as the most popular), while the other half reported that they did not use scoring at all.
Thank you to all the recruiters who took our survey this year!
If you have questions or suggestions, email Sam Feldman - firstname.lastname@example.org
written by Sam Feldman, People Analytics Manager