//this is the mailchimp popup form //ShareThis code for sharing images
Home / Blog / HR Needs to Be Prioritized at the Earliest Stages of a Company

HR Needs to Be Prioritized at the Earliest Stages of a Company

We discuss the importance of HR in the beginnings of an organization...

Phil Strazzulla
HR Tech Expert, Harvard MBA, Software Enthusiast
Contributing Experts
No items found.
Thank you! Your submission has been received!
Oops! Something went wrong while submitting the form.

Contributing Experts

Table of Contents

Share this article

Subscribe to weekly updates

Join 20,000 HR Tech Nerds who get our weekly insights
Thanks for signing up, we send our newsletter every Wednesday at 10 AM ET!
Oops! Something went wrong while submitting the form.
15 Best Employee Rewards Programs (2024)

A few weeks back, I read an article by a VC that outlined org charts for companies from the Series A through Series C (400 employees).

Before I criticize this post, I should say that offering the type of advice the author outlined is always perilous as the answer is invariably "it depends" for different types of companies in different markets.

However, what stood out to me in this article was how HR and Recruiting was very much thought of as a cost center from the get go.

HR was clearly under resourced, and a bit of an afterthought in these sample org charts.  Advice like this will lead to more companies at scale that simply do not care about HR!

In This Article

How HR should scale with venture backed companies

Currently, HR is thought of as a cost center across most organizations.  It's a legacy mindset that's tough to break out of!

It hurts companies as the strategic value from People teams isn't realized due to fixed budgets, lack of headcount, and lack of internal power.

This is an easy fix at the beginning of a company, and very hard at scale.

Here's how I'd recommend "HR" be treated by venture backed companies:

  • First off, call it PeopleOps and not HR.  HR has bad branding for many employees and management teams.  It's tied so closely with paper pushing, and stereotypes from shows like The Office.  Calling it People sends a message to employees, as well as the right candidates who may want to head up your PeopleOps.
  • Companies hire sales/marketing/engineering leadership at the Series A stage.  Companies should hire a senior People person at the Series A as well.  The right person will shape culture, comp plans, strategic hiring, etc.  Don't wait until you are 300 people.
  • Think of People strategically, not as a cost center.  They may run payroll, but they are also designing performance plans/management, training, headcounts, collaboration, and so much more.  This is the engine that allows your engineering team to build faster, and your sales team to sell more.
  • The head of People should report to the CEO, not VP of Ops/Finance.  Their work is as important as any other functional leader, they need access to the board, budget, and internal juice necessary to build a high performing organization.

Unfortunately, too many companies start off with the wrong mentality on HR.  They view it as a commodity to run payroll, and then the burden to do strategic People leadership falls on the shoulders of functional leaders and the CEO of venture backed companies.

Treat People like every other function at the early stage.  Hire a smart utility player who can do the blocking/tackling needed, but who also has the vision and business acumen to grow with the company.

Companies also need to reward these employees just like they would other senior execs, and think about their value to the organization in the same robust way (what's the ROI from faster hires, better onboarding, etc).

Many early stage companies hire "athletes" who are defined as hustlers who can learn fast to cover the responsibilities for leading sales/product/customer success/etc.  Toast is going public today.  Many of their early stage employees from head of product to CFO had no training or experience in that role.  You can take the athlete mentality to People hiring too.

The bottom line is that the early stage companies who take on the same ethos as companies who get People (Google/McKinsey/Goldman/etc) will reap the benefits for their entire lifecycle, as opposed to trying to right the ship when they get to 500 employees.

Phil Strazzulla
HR Tech Expert, Harvard MBA, Software Enthusiast
LinkedIn logoTwitter logo

Phil is the founder of SelectSoftware Reviews, a website dedicated to helping HR and Recruiting teams find and buy the right software through in-depth, expert advice. He has bought over $1 million worth of HR and Recruiting tools. Additionally, as of 2023, nearly 3 million HR professionals have relied on his advice to determine which business software they should buy.

Phil studied finance at New York University and started his career working in venture capital before getting his MBA from Harvard Business School. His in-depth understanding of the Saas landscape, especially HR Tech, stems from nearly a decade of researching and working with these tools as a computer programmer, user, and entrepreneur.

Featured in: Entrepreneur Harvard Business School Yahoo HR.com Recruiting Daily Hacking HR Podcast HR ShopTalk Podcast Employer Branding for Talent Acquisition (Udemy Course)

Related posts

Join 35,000 HR Tech Nerds who get our weekly insights

More posts
Read HR Tech Reviews