Comments on: Expand or stay comfortable? http://www.carsonified.com/business/when-to-hire-employees We love the web! Sat, 11 Oct 2008 13:43:53 +0000 http://wordpress.org/?v=2.0.5 by: Ideate - Small Business in South Africa » Taking the plunge to grow http://www.carsonified.com/business/when-to-hire-employees#comment-2925 Fri, 30 Mar 2007 20:25:14 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2925 [...] Ryan Carson runs a software company and is facing that issue right now. He wrote about it here. Most of the comments say “go for it!”, which is a very easy thing to say from the sidelines. However, there was a pearl of wisdom in Ross Williams’ comment (about half-way down) who said, “Just be sure that you don’t abdicate responsibility to new hires - keep them targetted with measurable goals.” I think that is an excellent piece of advice. Abdication is delegation’s evil sister, and the sooner I learn to tell the difference between them, the better! [...] […] Ryan Carson runs a software company and is facing that issue right now. He wrote about it here. Most of the comments say “go for it!”, which is a very easy thing to say from the sidelines. However, there was a pearl of wisdom in Ross Williams’ comment (about half-way down) who said, “Just be sure that you don’t abdicate responsibility to new hires - keep them targetted with measurable goals.” I think that is an excellent piece of advice. Abdication is delegation’s evil sister, and the sooner I learn to tell the difference between them, the better! […]

]]> by: simon r jones http://www.carsonified.com/business/when-to-hire-employees#comment-2906 Fri, 30 Mar 2007 13:22:29 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2906 Hiring new staff can be one of the most valuable things you can do to grow your business. We find having staff in-house developing your products has huge benefits. Plus it's nice to have more people around the office ;-) Good luck! Hiring new staff can be one of the most valuable things you can do to grow your business. We find having staff in-house developing your products has huge benefits. Plus it’s nice to have more people around the office ;-)

Good luck!

]]> by: Jeff White http://www.carsonified.com/business/when-to-hire-employees#comment-2862 Thu, 29 Mar 2007 22:42:04 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2862 I was in a similar position with my company about six months ago. I was working 90+ hours a week, never seeing my family and not having any time for myself. That lasted for close to a year. In December, I made the decision to hire someone and chose a designer who has been a huge boon to my business. He has allowed me to spend more time building the company and it has also given me more time to spend with my family. I say if you've got a good bit of cash saved and think that these people will allow you to really do more, go for it. As has been said already, business is all about calculated risk. There will always be something keeping you up at night, so you may as well go for it. Like my accountant says, if it doesn't work out, you can always let them go and move on from there. I also brought my new designer on as a three month trial period, and he and I both knew that we would re-evaluate the situation at that time. It basically means that neither of us will have lost a whole lot if it doesn't work out after the trial. Good luck! I was in a similar position with my company about six months ago. I was working 90+ hours a week, never seeing my family and not having any time for myself. That lasted for close to a year. In December, I made the decision to hire someone and chose a designer who has been a huge boon to my business.

He has allowed me to spend more time building the company and it has also given me more time to spend with my family.

I say if you’ve got a good bit of cash saved and think that these people will allow you to really do more, go for it. As has been said already, business is all about calculated risk. There will always be something keeping you up at night, so you may as well go for it. Like my accountant says, if it doesn’t work out, you can always let them go and move on from there.

I also brought my new designer on as a three month trial period, and he and I both knew that we would re-evaluate the situation at that time. It basically means that neither of us will have lost a whole lot if it doesn’t work out after the trial.

Good luck!

]]> by: Ryan Carson http://www.carsonified.com/business/when-to-hire-employees#comment-2819 Thu, 29 Mar 2007 10:53:00 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2819 Wow, thanks for the flood of good advice. You guys/gals are brilliant! :) Wow, thanks for the flood of good advice. You guys/gals are brilliant! :)

]]> by: aaron dragushan http://www.carsonified.com/business/when-to-hire-employees#comment-2812 Thu, 29 Mar 2007 08:51:16 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2812 Hey Ryan, I hear ya. One way to approach the decision is to consider the rate at which the new person would pay for their own salary. If you're hiring a salesperson or marketer, they might be paying for themselves within a month if your business has enough volume for them to work with. If you're hiring a designer it might take 6 months or longer. Another factor to consider is how long the job search will take (we usually figure 1-1.5 months) and then how long it will be until their first paycheque. If the sales figures for your app are *reliably* going up over time, you can hire a bit before you can afford it, but you have to be very careful. I enjoyed meeting you in Austin btw, and your talks were great. Keep up the good work! - aaron Hey Ryan,

I hear ya. One way to approach the decision is to consider the rate at which the new person would pay for their own salary.

If you’re hiring a salesperson or marketer, they might be paying for themselves within a month if your business has enough volume for them to work with.

If you’re hiring a designer it might take 6 months or longer.

Another factor to consider is how long the job search will take (we usually figure 1-1.5 months) and then how long it will be until their first paycheque. If the sales figures for your app are *reliably* going up over time, you can hire a bit before you can afford it, but you have to be very careful.

I enjoyed meeting you in Austin btw, and your talks were great. Keep up the good work!

- aaron

]]> by: Guillaume Justier http://www.carsonified.com/business/when-to-hire-employees#comment-2811 Thu, 29 Mar 2007 08:37:25 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2811 We use the same technique previously mentioned: When we have 50% of the cost of the new person, we go for it. The idea being that this person will generate the other 50% of the money very quickly (if only by freeing up time for you to find more business). My feeling is if you wait until you have 100% of the cost saved in the bank before you recruit, you are probably slowing your business down by not reacting quick enough. Of course feel free to adjust the 50% to whatever percentage you feel comfortable with. We use the same technique previously mentioned:

When we have 50% of the cost of the new person, we go for it.
The idea being that this person will generate the other 50% of the money very quickly (if only by freeing up time for you to find more business).

My feeling is if you wait until you have 100% of the cost saved in the bank before you recruit, you are probably slowing your business down by not reacting quick enough.

Of course feel free to adjust the 50% to whatever percentage you feel comfortable with.

]]> by: Matt http://www.carsonified.com/business/when-to-hire-employees#comment-2748 Wed, 28 Mar 2007 17:24:55 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2748 You definitely have to make that leap of faith in order to grow the business. We've done it several times, more often than not it's worked and it's been the correct decision to make the hire - we've had the occasional painful experience, but that's all part of the game and as long as you cut your losses quickly enough, you'll be OK. Ironically, we're now in the opposite situation. We have more than enough reserves and retained revenue to hire more staff, we just can't find good enough people. If there's one thing I've learned it's that getting the wrong people in can be an exceptionally expensive mistake. You definitely have to make that leap of faith in order to grow the business. We’ve done it several times, more often than not it’s worked and it’s been the correct decision to make the hire - we’ve had the occasional painful experience, but that’s all part of the game and as long as you cut your losses quickly enough, you’ll be OK.

Ironically, we’re now in the opposite situation. We have more than enough reserves and retained revenue to hire more staff, we just can’t find good enough people. If there’s one thing I’ve learned it’s that getting the wrong people in can be an exceptionally expensive mistake.

]]> by: Luciano http://www.carsonified.com/business/when-to-hire-employees#comment-2742 Wed, 28 Mar 2007 14:56:22 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2742 I can give you our own methology We have 10 employees We have the 75% rule We must always have 75% of our costs(salary/rent/utilities) cover with signed contracts When we have new contracts and this 75% grows we grow I can give you our own methology
We have 10 employees
We have the 75% rule
We must always have 75% of our costs(salary/rent/utilities) cover with signed contracts
When we have new contracts and this 75% grows we grow

]]> by: Cemonko http://www.carsonified.com/business/when-to-hire-employees#comment-2741 Wed, 28 Mar 2007 14:54:06 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2741 Ryan, Keep us informed about things changing in your company after hiring those two new staffs. I am sure you will have positive feedbacks. Ryan,

Keep us informed about things changing in your company after hiring those two new staffs. I am sure you will have positive feedbacks.

]]> by: Adrian Oh http://www.carsonified.com/business/when-to-hire-employees#comment-2738 Wed, 28 Mar 2007 13:54:33 +0000 http://www.carsonified.com/business/when-to-hire-employees#comment-2738 Since you know the business will "explode" once you have new hire, why worry and hesitate? Tight cashflow on happen at initial stage. I would say, let's just do it. You cannot do all the work by yourself, and it's not like you are hiring a team of army anwyay. Since you know the business will “explode” once you have new hire, why worry and hesitate? Tight cashflow on happen at initial stage. I would say, let’s just do it. You cannot do all the work by yourself, and it’s not like you are hiring a team of army anwyay.

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