Sabermetrics : Hiring strategy for Startups

How many times have you felt that your colleague/friend/roommate is getting overpaid?You can judge his salary based on his experience or qualifications or domain expertise and the list goes on and on…..There could be multiple answers to this question Though,I don’t have a startup(but working on it) but one thing is obvious : “A person joins a startup only if he is passionate about the technology or he has an urge to have his own startup sometime”.After speaking to lot of Entrepreneurs,I understood one thing that hiring the first few people in a startup is very important,the reason is they would be the people responsible for hiring other guys(for the startup)

So,hiring is the buzzword and it is not very simple.Wrong person getting hired in a large organization makes very less difference to the organization since, the company can manage to play around with him.The article tries to co-relate baseball fundamentals and hiring for startups…Below is the excerpt from the article by Joe Kraus, Co-Founder and CEO of JotSpot

Sabermetrics,what is it?
Sabermetrics is the analysis of baseball through objective evidence, especially baseball statistics. The term is derived from the acronym SABR, which stands for the Society for American Baseball Research.More on Sabermetrics here

Are you ready to join a Startup?
A person joining a startup should be very passionate about the company and the product.This means that every person should think as if he has invested in the product and if the product does not click in the market,he would loose his money

Are Engineers being underpaid in Startups?
So what is the relation of Baseball with Startups?The hiring strategy in Baseball teams(or for that matter any other sport) is based purely on following criteria:

How fast a player can run? How powerfully can they hit? How fast can they throw? How well can they field? How much do they have the “look” of a baseball player?

In order to build winning teams,we need to think different and go beyond the normal selection criteria whether it is baseball or a startup.Now,comparing this with the first few employees who are a part of the startup,Joe feels that Engineers are underpaid in startups..Have a look at the excerpt below:

I(Joe) think the market generally undervalues key engineering hires relative to their contributions.

Why does this happen? For a few reasons, I think. First, most CEOs are not technical (I’m not either). So, they tend to highly value the things they understand (marketing, business development, sales) and undervalue the things they don’t (engineering). Second, people are more attracted to people like themselves. Come from marketing and you’ll probably pay more for marketing people. Third, and perhaps most importantly, is the fact that there are no identified fact-based metrics that help CEO’s understand how to value engineers.

The article here brings to light some of the interesting lessons(related to recruitment) that startups can learn from Sabermetrics…Do not miss it by any chance