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0 pointsPatrol83944y ago0 comments

I worked at a startup and the CEO was obsessed with hiring at all cost. We, engineers, were all wondering what the hell these new hires were supposed to do. We did not need them.

Then they explained it to me. They needed to show growth through hiring in order to raise money.

I mean, I couldn’t even blame them, if that’s a criteria for VC to hand you a check, well you gotta do what you gotta do.

Needless to say this startup, eventually had to cut cost and end up firing most North America employees and replacing them with new hires in east Europe.

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9 comments · 3 top-level

jjeaff4y ago· 3 in thread

My experience is that current investors want you to hire tons of people to shorten your runway so they can force you into another round where they can buy more shares and dilute the founders more.

xuki4y ago

That might be part of it, but also VCs are not interested in $100 mil exits, they rather you go all out and either capture the market or die trying.

hef198984y ago

I always wonder how much of the faibled 99% start-up failures are up to that attitude. Imagine to settle for 100 million exit, at maybe 2x, more often. Couldn't it be tgat VCs would ve more profitable? Serious question, bevause VCs are professionals in what they do and they definitely have a reason. A reason that totally eludes me.

3 more replies

lozenge4y ago

Have they not heard of the mythical man month?

nowherebeen4y ago· 2 in thread

That's the equivalent of counting the number of lines of code to see how much work you did that day as a developer.

girvo4y ago

I'm always stoked when my daily contribution is a negative number of LoC

creakingstairs4y ago

It really shows how "free" capital has been last few years if the VCs can use that broken as heuristics and survive (even thrive).

mvdwoord4y ago· 1 in thread

Interesting and funny documentary from the dot com boom era in a finish company, riot entertainment. Great watch on the insanity of VC funding and growth.

https://m.youtube.com/watch?v=g0lrIi0ce5E

paulbjensen4y ago

Haha, I have watched that documentary multiple times, it is great and deserves to be turned into a film.

Someone's earlier point about hiring as a growth indicator to VC's reminds me of the point made by the CEO in the documentary about how VCs told him he needed to have 100 employees in order to boost the value of the company, so they ended up hiring people off the street, spouses and family members.

Crazy story.

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