Ask HN: Optimal number of employees?
How do I determine how many employees I should hire for my startup throughout its lifecycle?
3 comments
[deleted]
Look for bottlenecks. Are you overwhelmed with work? Can you partition off some of the work and explain it to someone else to do in less time than it takes for you to do it yourself? Will the work bring in more money than that person will cost?
If the answer to all those is yes, it's time to hire. Otherwise, it's not.
If the answer to all those is yes, it's time to hire. Otherwise, it's not.
This works in most cases but "Will the work bring in more money than that person will cost" sometimes isn't so cut and dry.
Customer service is a great example of this. A good CS person is going to create value for you in the long run (retaining customers, and preserving relationships). Your still going to be aligning income to staffing, but the numbers may be a bit less tangible in some cases.
Customer service is a great example of this. A good CS person is going to create value for you in the long run (retaining customers, and preserving relationships). Your still going to be aligning income to staffing, but the numbers may be a bit less tangible in some cases.
That's right but doesn't take into account lead time. Finding a good employee, especially early in the life of the company can take months. There is therefore a significant risk element involved in looking and planning ahead.
I'm assuming you're asking how to do this in advance, rather than how to make each hiring decision. A few ideas:
- Hiring is only part of your wider planning process. Do you know what you need to do in the future? If so, use that as a guide.
- Hiring is only part of your wider budgeting process. You will want to create a financial plan for your business, in order to force yourself to be explicit about your assumptions, and to work out whether there is a viable business there.
- Other similar companies may provide some indication of what you need, e.g. if you're a SaaS business then you could look at other SaaS business with similar customers and deal sizes, to figure out how many sales people you need for a given volume of sales. But you should probably do your own thinking bottom up first, rather than just triangulating from external data.
- Hiring is only part of your wider planning process. Do you know what you need to do in the future? If so, use that as a guide.
- Hiring is only part of your wider budgeting process. You will want to create a financial plan for your business, in order to force yourself to be explicit about your assumptions, and to work out whether there is a viable business there.
- Other similar companies may provide some indication of what you need, e.g. if you're a SaaS business then you could look at other SaaS business with similar customers and deal sizes, to figure out how many sales people you need for a given volume of sales. But you should probably do your own thinking bottom up first, rather than just triangulating from external data.