5 Things you Need to Know BEFORE hiring Employees [watch before you interview]

Summary

• As an operator CEO heavily involved in HR, one of my main focuses right now is resolving hiring struggles within our portfolio companies.
• Hiring the wrong person, especially in customer success, can seriously undermine departmental performance, stressing the importance of careful selection.
• A common mistake I see, including in my previous ventures like Gym Launch and Prestige Labs, is hiring someone because of likability rather than qualifications.
• Another mistake is hiring experienced individuals from big companies who act only as coaches, not as player-coaches, which is unsuitable for sub-10 million revenue companies that require hands-on leadership.
• I have also learned to never ignore red flags during interviews since the interview showcases the best of a candidate and issues spotted then only manifest more strongly later on.
• Hiring from the same small, insular community can create an echo chamber, lacking diversity in thought and ideas, which can limit business growth and innovation.
• Lastly, hiring for potential rather than practical experience is a trap if you do not have the time or expertise to adequately train the new hire for their specific role.

These five lessons come from both my successes and failures in hiring, aiming to help others grow their businesses without making these common errors.

Video

How To Take Action

A good way of doing things is to first focus on hiring the right people. Make sure you pick someone not just because they're nice, but because they can really do the job. Don’t fall for the likable person if they’re not qualified.

When you’re looking at experienced folks, don’t just get someone who's been a boss in a big company. You need a player-coach who will roll up their sleeves and work alongside everyone. Small companies need leaders who do the work, not just tell others what to do.

Always listen to your gut during interviews. If something seems off or there are red flags, don't ignore them. Chances are, if you see issues now, they'll be bigger later. It's okay to pass on a candidate if it doesn't feel right.

Try not to hire from the same small group of people all the time. This can make your business stuck and stop it from growing. Bring in people with different ideas to help your company get better and come up with new things.

Lastly, it's tempting to hire someone with potential, but it's better to get someone with practical experience. They should already know how to do the job. Only hire for potential if you've got the time and know-how to train them up right.

Remember, these tips aren't just good for now, they help build a stronger business for the future. Hiring the best people makes a big difference in how well your company does, so take your time and do it right.

Quotes by Leila Hormozi

"Likeness blinds you from all of the bad parts"

– Leila Hormozi

"You can't ignore that instinct that you have to like flag those things"

– Leila Hormozi

"Hiring from the same little incestuous pool of people…kills businesses"

– Leila Hormozi

"Hiring for potential not for practical experience"

– Leila Hormozi

"If you have time and expertise in the thing that they are filling…then maybe it does make sense to hire somebody who has the potential"

– Leila Hormozi

Full Transcript

laila hormozy co-seo of acquisition.com which is portfolio businesses that does about 85 million period revenue and my goal with this channel is really to help you get from wherever you're at to between three to 10 million in revenue for free and so that being said what i want to talk about today is something that has been really top of mind for me because it's been top of mind for our portfolio companies which is hiring and specifically having trouble hiring and this is something that we at acquisition.com we put a lot of time into um it's probably where i spend honestly like most of my time like i am heavily like i consider myself an operator ceo and i am heavily versed in hr and customer success and probably more hr right now than even customer success because i think it's actually more of a struggle for people and the reason for that is you know if you hire the wrong customer success person it's going to make customer success suck and it's like you basically have to be the one determining who's above all the departments and so it makes it a function i think is more important by nature that being said basically the struggle is like this week i think i've had you know three different ceos come to me ceos and ceos you know just struggling with hiring for certain positions in the companies right now and i wanted to share this because you know i was actually going to give personal feedback in a video to one person who specifically was feeling down about not being able to hire a pretty high level operational role that they were looking for and they just continue to send us candidates that you know we weren't impressed with at all because we a lot of times what we do with the portfolio companies is we actually help them you know recruit and then help interview uh with especially like a managerial role in their company and the reason we do that is because like they don't know what good looks like we do know what good looks like and so we want to help you know kind of mitigate and lessen the mistakes and the pain that they have to pay by you know inserting ourselves in the hiring process so like i like you know hiring helping people hire ceos operators customer success sales like all those roles because we know how pivotal they are if you get the right person to where the companies are at you know if you're between three and 10 million in revenue it's usually the issue is that you don't have enough leadership and the leadership you do have either has to go or has to get trained up or they're not really aligned with the culture and where it's going and so it's a lot of moving parts with the people stuff and so that being said i put together this list because i was going to share in a video with one of the ceos and i felt like chip i should just make a youtube content on this because it's obviously helpful for anybody who's at this stage and really it's my what i would say is like untraditional or like these are just my authentic thoughts about like where i see people messing up and hiring that i know i've experienced because like guys like the reason that i'm so good now at hiring and like i'd say i'm so good like just statistically the people i hire now it's like i have way less turn turnover false stars whatever you want to call them now because i've hired hundreds and hundreds and hundreds of people and i've interviewed thousands of people so like and i did that because and i became so diligent about it because you know you've seen my other videos like i've made so many mistakes in my first company gym launch and prestige labs like you know i just completely that up if you look at my video that's uh my biggest mistake i talk about it in there but that being said you know i've made it a mission to like really keep up with the stuff and and make sure i'm doing it correctly so i want to share just the top five things that i've seen be the biggest reasons that people aren't able to hire the right kind of talent and it's usually these aren't like tactical things as much as they are thinking frameworks and these are specifically businesses between three to 10 million in revenue um it could probably be less than that it could probably be more than that that's just typically what i see around that size the first one and this is absolutely the worst culprit possible is that people let likeness blind them i don't remember where i heard this it was a very long time ago and basically i had hired somebody who i thought was awesome he was super cool i really liked talking to him amazing guy i hired him because i liked him because i wanted to be friends with him not because he was qualified for the job and i see this so often in our portfolio companies and it's super dangerous because here's the thing likeness blinds you from all of the bad parts the downsides of these people and so like yes you want to be able to like the person but that shouldn't be why you hire them and so that's the first piece is are you letting likeness blind you are you letting it taint your perspective of this person are you letting it manipulate in your own mind so that you think this is the right hire and you're gonna be the more lenient on your requirements because of how much you like this person i think a lot of people do that and i'm seeing it right now like specifically with this one ceo you know like why do you not like these people like because you like them too much dude they don't even qualify for the role like they don't even have any of the skills required they don't even have full culture fit they're just cool that's great you want cool people but like they need to have the other stuff too so that's the first one is you don't want to let likeness blind you now the second one is that a lot of the times in businesses that are smaller or entrepreneurial etc you know you want to hire experienced people but what you don't want is you don't want to hire people who are coaches not player coaches okay so what i mean by that most people that come from larger companies and you're going to bring them into your entrepreneurial startup or you can scale up startup whatever you want to call it they come and they've been just sitting in a seat coaching people for a very long time or for years or whatever they've got into the habit of not doing and coaching but just coaching any company that's doing less than 10 million and i will even say that in some companies doing less than 20 million and even 30 million and even up to 50 million you can't just sit on your ass and tell people what to do you've got to get in there and get your hands dirty and a lot of times i see is you know someone brings a candidate to me and they're like i'm so excited this guy's like this operator from this huge company and this that i'm like amazing he's got a great resume let's talk to him i talked him like what do you do on a daily basis and it's like i check the kpis and i make sure people are doing what they need to do and i'm like okay but what projects are you leading and they're like well i mean i lead the change management i'm like we don't even have a change management protocol we're doing five million a year like i need you to like do all this over here do half this person's job and somehow build this team and so that's something you can't compromise on it's like if you're an entrepreneurial business and you're at that point where you're you know not an enterprise yet you can't compromise on not that you cannot you cannot there's no room for someone who's purely a coach not a player coach a player coach is someone who's like you know okay a coach in in traditional football for example he's never going to get on the field because a player is hurt that's not how it should work in business it sounds crazy like in small businesses the coach has to go in when the players hurt and they also sometimes need to be in the game no matter what and so that's something that can't be compromised a lot of times when first-time founders are interviewing more experienced people and i've made this mistake guys i'm telling you this because i've literally done this like 10 times you know i interviewed someone i'd be like you sound amazing this is great you have all this experience and they come in i'm like here's what i've been doing that it needs you to take over and they're like oh i'm gonna need to hire three people to do that i'm like what you know like i'm doing it why the can't you if there's people like that you know you kind of it's a lot of times if you set the expectation on the forefront you're like i'm gonna need you do all this so like you're not gonna do it like you know you're just not gonna stay here you're gonna end up getting fired immediately then they're like oh okay you know and like they get it you know but it's just that a lot of times we don't have the perspective to realize that we need to even say those things people and so that's why i'm making this video it's like that's the second thing is that people often hire a coach not a player coach the third thing and again this is probably for any size business but it's more it's it's like a muscle you have to train ignoring red flags here's the thing i used to interview people and you know they'd say something that bothered me or like they'd be saying in the interview that i was like i feel like that's gonna become an issue but i'd be like oh but everything else was so good like just because i sensed one thing wrong doesn't really mean anything the interview is the best you're gonna get from this person it's like the absolute best you're gonna get that is that is the 120 trying and so like if you've got red flags in the interview and they're saying things that are throwing you off then what do you think it's going to be like when they come in it's like you can't ignore that instinct that you have to like flag those things they say you've got to either dig in and find out what the heck is going on or you've got to say hey this doesn't seem like it's a fit this we're going to pass on this candidate and so it's just it's really a mindset of understanding the interview is the best it's ever going to get this is the hardest they're ever gonna try for you so if you've got red flags in the interview i would say that either they're not a very good you know interviewee or it's just not the right person with a role and that's the third thing is like you just you cannot ignore these red flags it's almost like a muscle that you have to continue to train like i know that over time mine becomes stronger and stronger which is really just not letting my need to fill a position override my instinct that it's not the right fit or that there's something else there or that doesn't feel right or that i need to dig more into that red flag and often times when it's like we're so eager to fill that position i totally get it because like i feel that way too that we just like put ourselves in more pain by hiring somebody who's not great for the role so that's the third thing now the fourth thing is something that is just the absolute worst in my opinion and i would say is probably like it's number four which makes no sense that's not number one number five but i put it as number four when i was writing things down so here we go is hiring from the same little incestuous pool of people guys this is literally what kills businesses is that you hire people from the same friend group the same pool the same community and everyone has the same ideas and perspective there's no diversity of thinking and i've like the reason i'm so passionate about this guy's like i specifically have one friend hires every single person from the same community of people and their business they're like i don't understand why it's not going to grow i'm like yeah because every single person in your business including you only values marketing and sales even the people in customer success in finance and hr they're all just sales and marketing people it's because you're hiring from these communities that are sales marketing and so like your business is just stuck because of all this these people because you're hiring from the same bullets like this incestuous pool of people that you're hiring from and this happens a lot our portfolio companies come to me and they're like i need to hire for this role i need to get this person etcetera i'm like cool we're gonna go post here and post here and then we'll get a recruiter for this one and they're like no but like i have communities i can post in these groups so i can finally i'm like just stop seeking to control it's like this need for control over like knowing that at least you know what you're gonna get and i think that's why people do it like i think it's this need to know it's like well at least i know that this person will be like a sixty-five percent like a six out of ten but like i'm sure they're six out of ten they're not a one out of ten they're not 10 attempt but they're six out of 10 if i get them from this community and it's like but they're not a 10 out of 10. and so because of that you're just setting your business up for in the long run it's like maybe in the short term they might work and they might plug the hole but they're not going to set you up for success in the long run everyone it's just me group think and this goes for if you hire from within your community this is super common nowadays there are certain roles it makes absolute complete sense to hire from your community i would say the two that are probably most relevant are sales and coaching like especially if you're watching my channel right now and maybe you have an e-learning or a coaching business coaches yes hiring from a community that makes sense they have to fit certain criteria of course but that probably makes sense sales as well they're convicted in your product they've used your product that makes a lot of sense finance hr executive admins uh you know controllers no this is one i just banged my head against the wall and that's probably why i'm angry is because there's two people particularly that i'm working with right now it's like they just despite my advice despite my begging they continue to hire from within the same communities in the same little cesspools of people and because of that they're setting the business up for disaster in the long run i've seen this play out so many times i've had it play out my own we've hired too many people from our communities it's like you need to go out there and even though it's harder in the short term to hire from platforms to hire from recruiters you have to spend more money you have to take more time you don't know how to do it you've never done it before it is all learnable and the great thing about it is once you learn the skill of cold hiring which is almost the same as marketing then you can literally get any kind of talent you ever need and so you don't have to just say like who's the best in this community to hire it's like who's the best in the world to hire because you have the skill of acquiring talent and that is probably the hardest thing for people at this level between 3 and 10 million especially even at 10 to 20 million i see people do this because they're bringing the habits from 3 to 10 to 10 to 20. and they just continue to pull and pull and pull from these communities and never learn the skill of talent acquisition until one day the founder looks up and says nobody in this business has an idea that is outside of my own brain that i haven't thought of nobody has thought of anything that i haven't already thought of and that's why i'm really passionate about that one just really making sure guys like when you're hiring it's so important to have diversity of thinking like i can't tell you like friction is good having different opinions is good it's studies all over have been done about this like the more opinions put on a decision in a team the better the outcome but if they're all the same opinion then what's the difference why even be there why are they even feeling the role they're just going to tell you what you want to hear and the thing is is that it's so hard and yet so necessary to have people on your team who tell you what you don't want to hear you're not going to get that from people who are just kissing your ass all day because you've changed their lives or because you're the kingpin in this community you're hiring from it's really hard and so i'm not saying it's 100 of time but i'm saying much of the time this is a huge issue for companies especially nowadays and then the last one number five is hiring for potential not for practical experience and so again it's i think what happens is we get into the interview cadence and we're interviewing someone and we just like we're like i know you haven't done this role before but you have so much potential here's the thing that's okay if you have time and expertise in the thing that they are filling the seat of if you're hiring for somebody to fill a role that you are currently doing that you are currently an expert in and you have the time to train them then maybe it does make sense to hire somebody who has the potential to fill that seat but 99 of the time you do not have the time and you don't have the expertise so you're hiring someone for potential without the know-how of how do i train them and without the time for when do i train them and so you always want to think like it is preferable to hire for practical experience somebody who's done the job someone who can tell you what their first 30 69 days looks like not the other way around and so i hope that these five tips were useful for you like if you're high right now i say this guy's like it was such a painful thing for me and it continues to be to watch people fumble with this because of these it's almost like biases in our brain right it's like we're so used to doing things the way that we have when the business is small and the reality is in order to make the business a good functioning big business we just can't keep the same habits we can't hire the same way we can't recruit the same way we can't pay the same way and so i hope this video is useful for you i have learned this lesson the hard way again like i said in my video my biggest mistake i have done this and i have messed it up and i just i would like that somebody can learn from my mistakes and so let me know what you think in the comments i hope this is useful for you and i will see you on the next one