a16z: 10 Pitfalls in Startup Hiring and How to Avoid Them
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a16z: 10 Pitfalls in Startup Hiring and How to Avoid Them
Building a team before establishing core values is another potentially costly mistake.
Navigating Web3 tides with focused insightsAuthor: Aurora Petracca
Translation: Luffy, Foresight News
For early-stage founders, focusing on product-market fit (PMF) is often the winning strategy. But once you achieve PMF and begin scaling, a whole new set of challenges emerges—each requiring new skills, knowledge, and strategic thinking.
Among these urgent priorities, what stands out as the most critical and difficult? Hiring—and hiring quickly. However, moving too fast without proper planning can lead to many painful and costly mistakes. To help founders avoid unnecessary growing pains, below are 10 common hiring mistakes we’ve observed founders repeatedly make, along with practical ways to avoid them.
1. Underestimating the time and effort required for hiring
When fully immersed in product development, you might sideline relationship-building until you need to hire. Many founders are surprised by how difficult it is to attract strong candidates without prior preparation.
Since most early-stage companies haven’t yet built a trusted brand, as a founder you must personally sell your mission, yourself, and your company’s future vision. This requires long-term, proactive, one-on-one talent networking that may take months—or even years.
From the moment you get an idea for a startup, start dedicating time each week to building relationships, talking about your business, and connecting with people you might eventually want to hire—all before you actually need to recruit.
2. Not prioritizing candidate experience
Founders often have packed schedules, but your stress shouldn’t translate into a rushed or disorganized interview process. Interviewers who haven’t reviewed a candidate’s profile, aren’t prepared with questions, repeat questions asked by others, or let the process stall for days or weeks create a nightmare candidate experience.
If candidates receive little or no communication from your team, or face delays, they’ll lose interest quickly—even if initially excited about your company.
Remember, candidates are interviewing your company too, and usually engaging with multiple opportunities. Worse, the crypto industry is small; negative experiences spread fast and can cost you top talent.
Ensure sufficient resources are allocated to hiring (whether by hiring a talent specialist or taking ownership yourself), keep the interview process moving smoothly, and maintain consistent communication. Always reserve time before interviews to research the candidate and avoid poor impressions due to lack of preparation.
3. Starting every interview with a generic pitch
Motivations vary across candidates. How can you effectively pitch to someone if you don’t understand their needs or why they’re interested in talking? It’s essential to cover basics: ask why they’re speaking with you, what’s missing in their current role, what aspects of culture they value, their decision timeline, and compensation expectations. But you must also be ready to tailor your pitch based on what you learn—this requires investing time to truly understand the candidate.
This challenge is especially acute in Web3, where companies often hire Web2 professionals who lack a solid foundation in crypto and its potential.
Without understanding the candidate, you might inadvertently emphasize things they don’t care about—or worse, overlook aspects that could genuinely attract them. Start by asking questions to uncover their motivations, then adjust your pitch accordingly.
4. Skipping due diligence to save time
Rushing through steps that could prevent major issues down the line is a common trap. For example, if a candidate seems perfect, you might skip a trial project or deep reference checks—steps that verify actual capability and fit. This “time-saving” move can turn into an expensive mistake.
Consider this: any time you think you’ve saved during hiring, you may end up spending far more managing underperformance. A bad hire can be devastating for an organization, especially a small, fast-growing company like a startup.
Instead, build a robust and consistent process, ideally including a trial work period to assess working style and team fit. Don’t skimp on thorough background checks. If possible, go beyond the “reference list” provided by the candidate and use your network to gather additional insights.
5. Scaling the team without clearly defined cultural values
Building a team before establishing core values is another costly error. Airbnb co-founder and CEO Brian Chesky describes culture as “a shared way of doing things with passion.” When founders establish strong culture through shared values, it deepens trust, promotes autonomy, and reduces reliance on formal processes. Without strong culture, everyone operates differently, leading to performance, communication, and retention problems.
Clearly defining values during team formation prevents hiring people whose values misalign—which can erode the culture you’re trying to build. This creates a vicious cycle.
Values serve as the unifying thread and shared work philosophy that hold teams together during tough times. Once established, integrate them systematically and consistently into your hiring process. For example, pre-define questions to assess alignment with each value and ask them in every relevant interview. This helps identify the best responses and avoids common pitfalls in culture interviews—like relying on whether you “click” or “can imagine hanging out” with the person—reducing unconscious bias.
6. Lacking long-term strategic thinking when hiring managers
You face an urgent problem and don’t have time to think long-term. The issue demands immediate attention: business development, strategy, marketing, etc. But avoid hiring someone just to solve today’s problem without considering your long-term trajectory.
What happens if your company grows exponentially in six months or a year? Will this person still be the right leader for overall strategy? Or will you need someone with broader vision and international networks?
Take time to map out all management roles you might need next year and how they’ll evolve. Who will own what?
When building your leadership team, aim for clarity in responsibilities and capabilities. Long-term thinking also helps you hire strategically—finding people who not only possess skills for future roles but are also passionate about the opportunities a startup offers. Be transparent from day one about short- and long-term expectations for success in the role, and how the organization may evolve under different growth scenarios.
7. Using inflated titles to attract candidates
To lure candidates, you might be tempted to offer grandiose titles like Chief X Officer. While some candidates like such titles, doing so can cause problems later:
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The person may not actually qualify for the title, especially as the company scales (see point 6).
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It may block future hiring of more senior leaders.
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You lose room to promote high performers later. (Internal promotions boost culture, retention, and recruitment appeal.)
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It sets a tone of hierarchy rather than a flat, “we’re all owners” mindset.
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Candidates overly focused on titles may not be a good fit for startups.
Before granting a flashy title, give the candidate a chance to prove their leadership ability. Before assigning senior titles, follow the advice in point 6: envision your company’s structure over the next six to twelve months. What roles will you likely need to fill?
Assess whether the candidate’s qualifications truly match the role. Ideally, bring them on at a slightly lower level and let them prove themselves over six months before promoting.
8. Poor onboarding with inadequate support
Founders sometimes assume that experienced hires, once given a laptop, will hit the ground running. While it’s reasonable to expect skilled professionals to excel in their domain, you can’t assume they’ll read minds. The only way to align expectations is through clear communication.
At minimum, create an onboarding plan outlining your expectations for deliverables and timelines (e.g., 30/60/90-day goals). Schedule regular check-ins (ideally weekly) during the first 90 days, adjusting frequency based on mutual preference.
Provide feedback on what’s working and what isn’t, and ensure new hires have channels to request any resources they need. For early-stage companies (under 10 employees), founders should personally help new hires connect with the rest of the team.
As the company grows, investing in a more structured onboarding program becomes essential. But regardless of sophistication, effective onboarding always includes: setting clear expectations and communication channels between manager and new hire, ensuring access to all necessary tools and equipment, and fostering strong team relationships.
9a. Overvaluing elite schools and big tech backgrounds
Stanford, MIT, Princeton, Waterloo, and Cornell are world-class institutions. But don’t exclude candidates solely based on educational pedigree.
Countless strong candidates didn’t attend top schools but spent their free time building projects on GitHub or solving real-world problems—clear signs of curiosity and problem-solving drive.
Likewise, overemphasizing FAANG experience narrows your talent pool. Yes, these companies often demand high standards and rigorous engineering practices. But many other companies also cultivate strong talent. Moreover, not everyone who thrives in a FAANG environment will succeed in a scrappy startup.
Don’t focus on credentials—focus on career trajectory:
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Have they taken ownership and proven successful?
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Have they worked on problems relevant to your company?
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Do they have grit and the right attitude to pitch in when needed?
9b. Overvaluing “crypto-native” candidates
On the flip side, crypto founders may assume “crypto-native” candidates are inherently superior. Limiting your search to only crypto-native talent risks missing exceptional individuals from Web2 with valuable experience and rigor. In Coinbase’s early days (~2014), there were no crypto-native experts, so we looked to “crypto-adjacent” companies (like payment firms), assessing core skills and genuine interest in the space. Then, we gave new hires time and support to grow quickly.
While an engineer experienced in RUST may contribute code immediately, any strong engineer should master a new language within one or two months. So instead of spending eight months hunting for the perfect web3 candidate, fill the role in half the time and allow the candidate room to adapt.
10. Underestimating the importance of in-person collaboration
Remote hiring offers flexibility, making it easier to recruit talent and accommodate those who work best from home. Yet, when everyone is remote, building trust and authentic relationships becomes harder.
Trust is often built through genuine connections, enabling more direct problem-solving, better cross-functional collaboration, and stronger bonds and friendships that help your company endure tough times.
Does this mean remote-first companies are flawed? Absolutely not. But remote hiring comes with a trade-off: you need periodic in-person gatherings and meetings to foster collaboration and relationships. Beyond increasing offline team interactions, consider concentrating remote hires in key regions and hosting local meetups more frequently. Remote work is a gift, enabling more inclusive hiring and letting people collaborate from anywhere. But it’s crucial to recognize that lack of in-person interaction has costs—and you must build mechanisms to mitigate them.
Summary
Running a startup is hard. As a founder, you’re pulled in countless directions—one of which is recruiting top talent. While hiring is challenging, it’s nowhere near rocket science. When founders prioritize hiring, they can become excellent recruiters. This list can help you avoid the biggest pitfalls in the process.
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