Hunkering down or hiring: the entrepreneur’s dilemma

Every growing business must, at some point, bring on help, but you need to know when the time is right

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Boni and John Wagner-StaffordWhen you start building your business, long hours are expected. But no one can – or should – keep up that pace forever. It’s a drain on your personal, mental and physical health, and it will kill your business growth, too.

“When I first started out, I did do everything,” says Sarah Picciotto, founder of OnPoint Legal Research, a law firm created solely to provide outsourced legal research and writing services to other lawyers. “Pretty soon I had to ask myself the tipping point challenge: is it going to cost me more by way of my time than it would cost to hire someone to do this?”

The first thing Picciotto farmed out was her bookkeeping. She could do it herself but it made much more sense to farm it out to someone who could do in four hours what would take her eight. That bought her eight hours to allocate to business development. Soon she was also outsourcing her website, design, monthly newsletter and data entry. Today, she outsources as much as she can.

Look beyond the typical tasks when you’re trying to create some space in your day.

Almira Bardai co-founded Jive PR about five years ago. Bardai says the rapid growth of the boutique digital social media and public relations agency delivered important lessons about adding capacity.

“We started out with a plan that Jive would simply be the two of us providing our PR consulting services to clients,” explains Bardai. “But we ended up bringing in more business than we thought and suddenly we needed a people plan to manage the growth.”

Bardai and her partner knew they needed to hire people who could do everything they could to properly serve the clients on Jive’s growing list. That meant hiring for senior, strategic roles.

Jive PR now has offices in Vancouver, Toronto and California, and was recently included in the 2016 PROFIT/Chatelaine W100, which celebrates entrepreneurial achievement by women in Canada. Bardai now mentors other women entrepreneurs.

“Many of the women I mentor tend to hire co-ordinators, which is great,” says Bardai. “But I ask them how, exactly, are they planning to cut themselves in two? Because when you’re growing a business you need a strategic people plan and you need to plan for scale. You need to think about replacing yourself.”

The trick is knowing when the time is right to hire. You don’t want to bring on employees, even senior ones, too early or you’ll kill your cash flow. Too late and you risk missing that magic market moment because you’re just too busy. While the right time will be different for every business, there are parameters you can use as a guide.

  • Hire a product design and development lead when you have a team of one to five people.
  • Hire a senior marketing manager once you’re working with of five to 10 individuals.
  • You will probably need a business development and/or sales lead by the time you have 10 to 20 on staff or contract.
  • Your operations and HR managers will have plenty to do by the time you’re paying between 20 and 50 people.
  • And over 50? Time to consider bringing on a business intelligence specialist.

There are also signposts that indicate when not to hire.

  • Feeling stressed and desperate? Don’t hire. Mark it down as a learning moment that you needed a better people plan.
  • When you think you really need help but don’t know exactly what the help will do? Don’t hire. You’ll be bringing someone on board who will end up ineffective and confused because you haven’t appropriately defined the role or responsibilities.

The bottom line is that every growing business must, at some point, bring on help.

“It is painful to spend money when you may be in the red but at some point you have to take a reasonable leap,” says Picciotto. “If you don’t, your business will fail.”

Between them, Boni and John Wagner-Stafford have five decades of experience as entrepreneurs and/or providing consulting services to small businesses across Canada.


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